Speaker #1: Thank you, and over to you, sir.
Speaker #2: Thank you, operator. and a very good evening to all of you. Thank you for joining in, and welcome to Engineers India 2Q, FY27 earnings conference call.
Speaker #2: We have with us from the management team of Engineers India being represented by Mr. Sanjay Rindal, who is the Director of Finance; Mr. Suvendu Paddy, who is the Company Secretary; and Mr. Vivek Mitta, the Chief General Manager.
Speaker #2: With that, I would now like to hand over the conference to the management for their opening remarks. Post which, we will have a Q&A session.
Speaker #2: Thank you, and over to you, sir.
Speaker #3: thank you, Mr. Kirthan Gopalji. Good afternoon. Everybody, and a warm welcome to all the investors, who are attending the investor call. We have declared our financial results for the second quarter ended 30 September 2026 today.
Speaker #3: Companies' order book position has reached its all-time high and stands at Rs. 20,421 crore as of 30 September 2026, as compared to Rs. 14,424 crore as of 30 June 2026.
Speaker #3: Order inflow in EL up to second quarter of financial year 26/27 stands at Rs. 7,428 crore. And on this standalone, results, we have declared results of quarter and half-year ended September 26 on 30 October 2026 as regard to financial performance for the 3-month ended September 26.
Speaker #3: The company has registered a turnover of Rs. 802 crore, which is to Rs. 800 crore in the first quarter of financial year 26/27. Turnover from consultancy and engineering segments to debt: Rs.
Speaker #3: 594 crore, and from the tanki segment at Rs. 208 crore. During the quarter, current quarter ended, September 26, the company has recorded profit before tax of Rs.
Speaker #3: 229 crore in comparison to Rs. 145 crore during the first quarter of financial year 26/27, showing an increase of around 58% in profit before tax and profit after tax of Rs.
Speaker #3: 180 crore in comparison to Rs. 109 crore during the first quarter of 2026/27, showing an increase of 65% increase in PAC. Notably, EPS for the quarter ended September 26 stood at Rs.
Speaker #3: 3.20, which is June 26 at Rs. 1.93 on the against-the-face value of Rs. 5 per share. Operating margin during the second quarter of financial year 26/27 stood at Rs.
Speaker #3: 152 crore, that is 19%, which is 108, that is 14%, during the first quarter of 26/27. It means our operating margin has increased from 14 to 19% in the second quarter of current year.
Speaker #3: EBITDA including other income of company during second quarter 2026 stood at around Rs. 240 crore, that is margin EBITDA margin 27% in comparison to Rs.
Speaker #3: 155 crore EBITDA margin 19% during the first quarter of 26/27. It means in the from the first quarter to second quarter, our EBITDA margin has increased from 19% to 27%.
Speaker #3: On the half-yearly front, up to 2,000 up to 30 September 2026, the company recorded profit before tax of Rs. 375 in comparison to Rs.
Speaker #3: 243 crore, and profit after tax of Rs. 288 crore against the Rs. 185 crore up to September 25, showing an increase of 54% in profit before tax and around 56% increase in PAC.
Speaker #3: Operating margin for the first half-year of 26/27 stood at Rs. Stood at around 16% in comparison to 9% in the first half-year of 25/26.
Speaker #3: EBITDA of the company for the first half-year ended September 26 stood at around Rs. 395 crore, EBITDA margin 23% in comparison to Rs. 265 crore EBITDA margin 14% for the first.
Speaker #1: Please.
Speaker #3: I will start again from the EBITDA. EBITDA including other income of the company for the first half-year ended 30 September 2026 stood at around Rs.
Speaker #3: 395 crore, which is 265 crore for the first half-year ended 30 September 2025. Our EBITDA margin has increased from 14% to 23% in the same period.
Speaker #3: In the first half-year of 26/27, the company achieved a turnover of Rs. 1,600 crore in comparison to Rs. 1,758 crore in the first half-year of 25/26, with turnover from consultancy and engineering segment amounting to Rs.
Speaker #3: 193 crore Rs. 1,093 crore and Rs. 510 crore in tanki segment. Notably, in the first half of 26/27, our revenue mix has been changed from Rs.
Speaker #3: 47% in consultancy segment and Rs. 53% in tanki segment in the first half-year of financial year 25/26 to Rs. 68% in consultancy segment and Rs.
Speaker #3: 32% in tanki segment. The consultancy segment remain has higher margin as compared to tanki segment. The company is maintaining a healthy earning per share in the first year of 26/27.
Speaker #3: The earning per share stood at Rs. 5.13 per share for the first half-year ended September 26 in comparison to Rs. 3.29 per share for the first half ended 30 September 2025.
Speaker #3: This is against the face value of Rs. 5 per share. On the consolidated front, the company earned a profit of Rs. 197 crore for the quarter ended 30 September 2026 in comparison to profit of Rs.
Speaker #3: 158 crore for the quarter ended 30 June 2026. For the half-year ended September 26, the profit stood at Rs. 355 crore in comparison to profit of Rs.
Speaker #3: 149 crore for the first half-year ended 30 September 2026. Thank you. And over to Krishnagopal.
Speaker #2: Hello.
Speaker #1: Yes, sir, you're audible.
Speaker #2: Yeah, okay. Now we can start question answer.
Speaker #1: Sure, sir. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on the touchstone telephone.
Speaker #1: If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question.
Speaker #1: Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Mohit Kumar from ICICI Securities.
Speaker #1: Please go ahead.
Speaker #2: Yes, good afternoon, sir. And congratulations on a very, very good set of numbers. so my first question is of why is there a one-off in the consultancy segment?
Speaker #2: The margins are pretty margins are 30% compared to our usual run rate of 23, 24%.
Speaker #3: Yeah, you are right, sir. For this second quarter, this is around 30%.
Speaker #2: 30 crore. So just 30 crore for.
Speaker #3: 30%. 30%.
Speaker #2: 30%. My question is, sir, why is there a one-off for the for the anything we have booked for the past period in this quarter, is that the reason why the consultancy income is very high, or is it that the everything is all everything is as, as usual?
Speaker #3: No, sir. This time, we have changed the business list in the last first half-year our consultancy segment was 47%. Execution was 47%. Now this time, turnover from the, consultancy segment is 68%.
Speaker #3: And from the LFT segment is 32%. And since, margins in the consultancy segments are higher, therefore profit is also higher.
Speaker #2: Mm-hmm.
Speaker #3: And as such, there is no one-time item.
Speaker #2: So is it fair to expect that this 30% most of it is sustainable going forward? Is the number which one should look at for the maybe going forward, given that the mix has changed?
Speaker #3: definitely we will maintain our 24, 25%, segment profit in the consultancy segment on overall basis, yearly basis.
Speaker #2: Understood. So my second question is, sir, of course, the presentation has not been uploaded as of now. Is it possible to give us the breakup of all the inflow for the quarter between the two segments?
Speaker #3: It is uploaded, but I will, tell you the figure. Our order inflow for the, current, first half is 7,000, 428, and out of which, 5,762 is from consultancy segment and balance 1,666 crore is from LFTK segment.
Speaker #2: Understood, sir. Understood. Sir, my, my third question, sir, given the fact that, of course, your, your, you have already, I think, down 7,400 crore as a peak, right?
Speaker #2: for the order inflow. And if I remember correctly, I think we had, we had guided for 8,000 crore order inflow. So would you like to revise our target and?
Speaker #3: Definitely, sir. We will cross the figure of 8,000 crore. And the coming.
Speaker #2: I think you were saying new guidance, sir. New guidance.
Speaker #3: no, no. We are putting all, all of, first, the two cross the figure of 8,000 crore. I hope next time we will revise the guidance on the count of this.
Speaker #3: If required.
Speaker #2: Understood. My last question, sir, how is the pipeline developing in the Middle East? Are you seeing some recovery? I think the things are stabilizing now.
Speaker #2: Are you hopeful that we'll be able to, book some order inflow in this fiscal year?
Speaker #3: But, I'm just responding to this. I'm just responding to this. gentlemen, you know that the situation is not all right in, in the Middle East.
Speaker #3: Still, that situation is on. So we'll have to be hopeful on this. Businesses, we are doing, a little bit well, and we are progressing and bidding for the various jobs in Saudi.
Speaker #3: We are still, waiting because the situation is not good there. Because the attacks are still there. So let's hope for this. but however, we have, we have recovered this from the Africa side.
Speaker #3: So let's, let's see how it goes. Because the situation is not, normal in the Middle East, sir, at this point of time. We'll have to wait for some more months.
Speaker #2: Understood, sir. Understood, sir. Thank you and all the best. Thank you.
Speaker #1: Thank you. The next question comes from the line of Sanjita Sood from Robo Capital. Please go ahead.
Speaker #4: Yes. thank you for the opportunity. sir, my first question was that, what kind of revenue growth can we see, for this financial year? And, FY 28 as well.
Speaker #4: as well as some guidance that you could give on, what kind of EBITDA margins we'll be doing these two years.
Speaker #3: You are taking into consideration the current order book? we have already given that we'll be achieving a revenue of around 4,200, during the current financial year.
Speaker #3: And going forward, definitely we are taking into consideration the order book, the further growth of around 10%. In the revenue side.
Speaker #4: Okay. Got it. And, sir, my second question is, what kind of order inflows can we see in, H2 of this year and, next year?
Speaker #3: Mr. to, sir. we have already secured. You have seen that this is 7,400 crores. We have, secured in this quarter. We have, in fact, certain more orders that we received as of today, we stand at 8,100 crores.
Speaker #3: as of today, we stand at 8,100 crores. So let's, let's hopeful that, we'll achieve some of the, more business, out there. And, we are working towards it.
Speaker #3: Let's see how it goes. We still have six months to go.
Speaker #4: All right. Understood. Thank you. That's all from my end.
Speaker #1: Thank you. A reminder for all the participants: in order to ask a question, you may press star and one on your touchstone telephone. A reminder for all the participants that in order to ask a question, you may press star and one on your touchstone telephone.
Speaker #1: The next question comes from the line of Deep Sanghavi from Dalal and Brocha Stroke Booking Private Limited. Please go ahead.
Speaker #3: Yeah, thank you. Thank you so much for, the question. And, congratulations on a great set of numbers. So my first, question would be, that you had guided for 4,200 crores of revenue for FY 27, right?
Speaker #3: with a 55, 45 split. 4,300. Yeah, correct. so that come, with a 55 to 45 split, right? Turnkey, consulting and Turnkey. On an average, on approx basis.
Speaker #3: So that comes out to almost 1,900 crores of revenue from Turnkey. In the first two quarters, this time exact consultancy segment is more and LFTK segment is lower.
Speaker #3: Because most of the big tickets project of LFTK segment is already over. And new projects are new projects have been started. And we it will take some time to get full ti full revenue from these LFTK segments.
Speaker #3: So in the current year, we expect that consultancy segment will be more. It will be around more than 60% on overall basis. In the overall.
Speaker #2: More than 60%. Is that right?
Speaker #3: Around 60%.
Speaker #2: Okay. And sir, so just a follow-up to that question. So, why are the margins at 4.3% for Turnkey? Is there any, reason for that?
Speaker #2: Or?
Speaker #3: No, no. it is always flexible.
Speaker #2: Because the range because it should, it generally is in the range of 6 to 7%, right? So that's why I'm asking.
Speaker #3: 6 to 7% are okay. But generally, in the new projects, cost progress are not there. Therefore, profits are, little 4 to 5% fine. But as the project gets momentum, the profit will also get more.
Speaker #2: Right. And sir, so, as you had said that, that there are a lot of Turnkey projects which will go, which will have faster execution in H2.
Speaker #2: So is that still the case? are you expecting the ram like, execution to ramp up in Q H2?
Speaker #3: Definitely. Our execution in LFTK segment should ramp up. Because it is in the first half, it is 32% from the LFTK segment. And we are expecting it should be around 40, at least 40% from the LFTK segment.
Speaker #2: Right. And so, sir, the sec the second question, would be, so it is on the nuclear segment. so just hypothetic hypothetically taking 10,000 crores nuclear project, so, a significant portion of Capex would be towards nuclear reactor and the main the nuclear island, right?
Speaker #2: And currently, we have opportunities in BOP and environmental studies if I'm not wrong.
Speaker #3: Yes.
Speaker #2: So could you give us a broad, broad sense of how much of the kind of, like, the project cost would is addressable to EIL and, like, BOP and environmental studies?
Speaker #3: No, it's like this. Yeah. Yeah. I'm just responding. on the nuclear side, we have we know that there are a lot of opportunities are coming.
Speaker #3: But all of them are the initial, initial stages. Like, they are in the study phases. Some of them are in the environmental impact assessment study.
Speaker #3: some of them would be the initial stages of tendering. So, the this, this phase would take some time, times to come because many of the project location is still been finalized.
Speaker #3: So we are working towards it. So it will be a good, it will not it will be a significant amount, but it will not be in this financial year.
Speaker #3: It will take, some time probably a year or so. Next financial year, we can see, some, good orders from there in the segment. Because we are also establishing in the, our own systems in-house also.
Speaker #3: We have created verticals to handle all these things. And, sprucing up our manpower with all the kind of, trainings and experiences. So we are making them ready, for all these jobs.
Speaker #3: And we are bidding for some of the assignments also.
Speaker #2: but sir, how much, how much would like, for let's say.
Speaker #3: I can't tell you I can't tell the figures. No, no. It's, it's very difficult to tell the figures at this point of time. Depending what kind of job is going to come and how much work we are going to have.
Speaker #3: It could be a detail engineering assignment. Could be a smaller assignment also if you get a bigger assignment. Then the value would be, major.
Speaker #3: So it's very difficult to tell and, and.
Speaker #2: No, sir, I, I just wanted to understand if there if, EIL is will only do, like, BOP and environmental studies, or will there be a larger scope for the.
Speaker #3: No, no, I guess it is EIL will be doing the engineering services, which will be balance of plant, engineering, consultancy, and some, something related to construction supervision also, kind of engineering and supervision role.
Speaker #3: Owners engineers role, I can say.
Speaker #2: Right. Right. Okay. Okay. Thank you. And now, the last question would be, are there any change orders or any provisions right back you are expecting for, this quar this fiscal or the next fiscal?
Speaker #3: definitely. We have lots of change order which we are negotiating with our clients. And it is expected that all these change order will be settled in this, financial.
Speaker #2: Yeah. Okay. Thank you. I'll join back the queue.
Speaker #4: Thank you. The next question comes from the line of Prateep Duggar from Intelsens. Please go ahead.
Speaker #2: audible?
Speaker #4: Yes, sir. You're audible.
Speaker #3: Okay. Thank, thank you for the question. congratulations to the management on a good set of numbers. sir, actually I wanted to, ask, about the consultancy division only.
Speaker #3: If you look at the specific, margins for the consultancy division, what we have seen that it has come at around 30%. there was this question by another, participant also.
Speaker #3: So like, is this a normal course of, margin that we can expect going forward, or was there a one-off in this, this time? first of all, in this quarter, there is no one-time payment.
Speaker #3: No, no one-time payment or settlement. And on the half-yearly basis, it is 27.7 27.7%. And on overall basis, we are expecting that it will be settled around 25%.
Speaker #3: We are sure that we will maintain the figure of 25% in the consultancy sector. Because, project in the projects, revenues are always cycling. So on the conservative side, we are ensuring that we will maintain our mar traditional margin of 25.
Speaker #3: But definitely in this quarter, it is 30% without any one-time.
Speaker #2: Okay. and sir, regarding, specifics of, the depository orders, that we had got, so I think last FY26, the depository order execution had begun along with the Dangote order, execution.
Speaker #2: So FY27 is where Dangote should ramp up. And depository orders should peak. So with that mix and, and, obviously our overseas consultancy order would also again, sort of accelerate in FY27.
Speaker #2: So wouldn't these specific orders, like, add up to the margin and the guidance of 25% you are giving, is, is it on the lower side or you are saying that 25% would be what one should expect and there's no upside to that?
Speaker #3: No, definitely there is on the upside because we have lots of, overseas order which are under execution. But basically it depends upon the cost progress of the projects.
Speaker #3: And 25% is the minimum figure I have given on the conservative side. It's because we are sitting on the half-year results. And on the half-year basis, it is around 28% in the first half figure.
Speaker #3: So I am saying it will we will definitely maintain our traditional figure of 25%. And definitely, this time, this figure will be higher than the 25%.
Speaker #3: But exactly I cannot commit that it will be 30%. Higher than 25%.
Speaker #2: And sir, if I extend my view to say, first half of FY28, where, you know, Dangote would sort of be peaking and, we would be having a higher run rate on the revenue side as well.
Speaker #2: So, by H1 of FY28, do we see a meaningful inflection in the bottom line, for the company?
Speaker #3: Definitely. Our bottom line will be healthier. More and more healthier in the coming years. Because, we are having order book of 20,000 more than 20,000.
Speaker #3: And we will, yielding more and more revenue. And our bottom line will be healthier in the coming years.
Speaker #2: okay, sir. Sir, depository orders that we have, what, what, what should be the margins on specifically on the depository orders? And if you can explain, like, why do we categorize this at a difference?
Speaker #2: I mean, why, why, why do we not take it as a consultancy order only? Why is it categorized differently?
Speaker #3: In the depository segment, all the, in the consultancy segment, only fees part is coming in the top line. But in the depository segment, all the, yeah, all the plant and machinery cost and material cost is coming in the top line.
Speaker #3: It is just like LSTK business. So that's why in the depository segment, profit margin is 7 to around 7%.
Speaker #2: Okay. So, once, like, the depository starts tapering off in H1, H1 of FY28, then I think margins would again sort of, be better, for that period.
Speaker #2: Because, like, the lower margin segment is coming off and Dangote would be peaking at that time.
Speaker #3: See, we are we are keeping balance between the consultancy segment and the depository segment. In the consultancy segment, we are focusing about 60 to 65% and balance from the LSTK segment.
Speaker #3: So it is a balancing game. We are not leaving LSTK business totally.
Speaker #2: All right. Okay. Thank you, sir. That will be all from my end. And congratulations on saving.
Speaker #3: Thank you.
Speaker #4: Thank you. The next question comes from the line of Amit Anvani from PL Capital. Please go ahead.
Speaker #2: Hi, sir. Thank you. First of all, congratulations for very good numbers.
Speaker #3: Thank you, sir.
Speaker #2: And, the first question, sir, in terms of order pipeline again. So this year we did a very commendable job. We are already there in terms of the guidance which we have given.
Speaker #2: And we will be easily surpassing and there was a major contribution to this from the overseas consultancy, especially the Dangote orders which we want.
Speaker #2: We just wanted to understand the order pipeline, outside India, geography-wise. Are we looking for more large lumpy orders? in the pipeline in the next 12 to 18 months?
Speaker #2: And, second, what one should look for the order guidance for next year? Are we going to continue this run rate of 8,000 plus for next year, year after that?
Speaker #3: Mr. Vivek Medavilan, Amit, Amit, it's like this. we are bidding for a number of the projects. And you are seeing that, something comes up, in between.
Speaker #3: So it's very difficult to tell you that which order is going to come. But we are bidding for a number number of, projects. All across the world.
Speaker #3: And in various territories also. And including India also. So we are hopeful that, it will be able to get more, business out of it.
Speaker #3: As already told you on the call that we have already reached 8,100 crores. Next year and actually it would remain, at least 8,100 crores will definitely achieve.
Speaker #3: Because we have been consistently maintaining almost at the same range. And if everything goes wrong politically, everything remains same. And market, market remains the same.
Speaker #3: Capex are invested. And we'll continue to, grow. And, continue to improve our business opportunity.
Speaker #2: All right. Second, in Middle East, we were, in some long-term agreement with, Ramco and expecting some orders. Any update on that? And what is the Middle East, order book?
Speaker #3: And no, at this point of time, it's always published. It's all already published. All is all good. The situation is not stable there. They have, not a major order, we have anticipated.
Speaker #3: But we are bidding for various, contracts out there. So something comes up, we'll update you towards the end of this next financial sorry, end of this financial year.
Speaker #3: Probably next quarter. By the time, hopefully, the things should stabilize or the war should stop. But as of now, there is a lot of, issues there in Southeast.
Speaker #2: All right. And lastly, in terms of guidance for next year, we said, 10 plus plus percent. But I think the order wins, very strong.
Speaker #2: And, is it again a conservative guidance for next financial years? Also, I think we can we can improve that. We are
Speaker #3: going to maybe we'll go we'll improve it. it depends on the situation in a couple of months.
Speaker #2: Right. And expectation is that the consultancy will still continue to be, more than the, the turnkey. Okay. Last question on the yeah.
Speaker #3: It is, it is likely it's always somewhere around 60%, 65%. And 60, 40 ratio remains. So it is always remain in that range somewhere.
Speaker #3: Somewhere, sometimes you get a big ticket once, then the consultancy portion becomes heavy. And then sometimes you get LSTK. But it has always been in this range.
Speaker #3: Sometimes it is 60, sometimes it is 50. So definitely it will be in that range.
Speaker #2: lastly, on the other income, this other income number was higher this quarter at 60, 5 crores. what contributed to that?
Speaker #3: In the, other income, there is a dividend from the NRL to the tune of 21 crores. And another dividend of 11 crores from the CIL, balance is, regular income.
Speaker #3: Income on or surplus funds, rental income, and, some other miscellaneous income.
Speaker #2: Understood. And the Ramas yeah.
Speaker #3: Initially, there is increase on account of dividend from the CIL and NRL.
Speaker #2: And, will that continue or how is the dividend, looking like for this full year?
Speaker #3: We are receiving dividend on continuous basis from the NRL and CIL.
Speaker #2: Okay. Okay. And lastly, sir, Ramagundam, how is the situation there? Is it I can see the numbers there also has been better. So, Outlook there, would help.
Speaker #2: Thank you.
Speaker #3: And definitely, Ramagundam is doing better. And, in this quarter, we have got the profit of 20 crores. And in the first quarter, it was, 42 crores.
Speaker #3: And total profit, up to this period, half year, 63 crores. So we are expecting good, good, more and more good news from the RFC.
Speaker #2: Understood, sir. Thank you, sir. Thank you so much.
Speaker #4: Thank you. The next question comes from the line of P. Jha, an individual investor. Please go ahead.
Speaker #2: Thank you. first of all, some extraordinary numbers. And, I would like to, understand the domestic, possibilities in, especially in, coal gasification. And, in, green hydrogen.
Speaker #2: and, in your, 2G, refinery. besides, any other storage of crude. These, if you can throw lights, respectively on them for this current year. Because in the year as described.
Speaker #3: Yes. Yeah, yeah. sir, with respect to the, coal gasification, after this government of India's initiative of, additional 34,000, this funding for these EVS lab funding, there are studies which are on, on this.
Speaker #3: And we are bidding for a couple of projects. The major projects also. let's see, with how it realized. And, various studies we are bidding.
Speaker #3: And, some of the studies we are also carrying on. Like one work we are carrying out for NTPC. So that's the current situation of it.
Speaker #3: So, let's see, towards the end of this year, if, the studies are completed, the studies are avoided. And then, they go for the, financial closure and go for the implementation of the project.
Speaker #3: So that's the current situation of, the coal gasification. regarding hydrogen and, this, there is nothing much that, we have at this point of time.
Speaker #3: So we're still looking for the good opportunity. And, biorefinery also. At this point of time. There's no major significant work is there. However, we are implementing one CBG plant for our own.
Speaker #3: we are implementing it, with our own investment. We are also thinking of having another CBG plant wherein we are investing on our own, in line with the government guidance.
Speaker #3: So that's one of the opportunities there.
Speaker #2: And how about, crude, storage, the thing that,
Speaker #3: You know that, after this, this ISPRL is going to invest in, is, is thinking of having more strategic storages. All across like MP and Leena MP, Leena and their other two, three more locations are there.
Speaker #3: So those will be opportunities available for us to bid for it because ISPRL, most of the projects have been done by strategic storages. And we are very good in strategic storage.
Speaker #3: So those will be there. Otherwise, other storages are part of the projects, major projects. So these are there. Whenever any major projects come, just crude storage and terminal is always comes as a part of it.
Speaker #3: But as well as the strategic storages, this is ISPRL projects are on the annual, which are published. So we'll be bidding for those. Carrying on.
Speaker #2: Outstanding. And, now, now very broad, this thing that, for the domestic, quarterbook, for the remaining part of the year. Or let's take the, during the next financial year also.
Speaker #2: What is, the expected, turnout, order book that you expect domestically speaking? From all these segments, if you have any management would have some.
Speaker #3: Not at this point of time. No. I can talk about the, business intake at this point of time, which is around 8,100 we are there.
Speaker #3: So we are going to add something more. And next year we are going to maintain it like this. And overall order book is around 20,000 crores, wherein almost 60,000 crores is, that's almost, 60% is from the overseas.
Speaker #3: And balance would be from the domestic, so around 40%. So let us see. Typically remains, remains around 40, 50% we can be having from domestic marketing.
Speaker #3: If we maintain that principle.
Speaker #2: As of date on the order book, portion, we have 75% from the, consultancy sector.
Speaker #3: Yeah. This is, this is. Good on the part of EIL because we are at margin in the consultancy sector.
Speaker #2: Naturally. Yeah, yeah. Absolutely. Extraordinary, sir. Great, feat achieved. All the best. Thank you.
Speaker #3: Thank you.
Speaker #4: Thank you. The next question comes from the line of Akshay Koligar from DBPMS. Please go ahead.
Speaker #5: thank you for taking my question. So far, I'm audible to you. my first question is on, on the 4,200 crore Dangote order. Given the ongoing court case in Kenya around the proposed refinery project, has there any impact on the project timeline?
Speaker #5: or EIL scope of work? And also, has a work commenced on EIL mandate? And is there any risk on execution of the order at this stage?
Speaker #3: just don't go by the news. The work is already on. Work is already on. We are working on the engineering side of it. And that is, contractors, that is owners' perspective.
Speaker #3: And he is managing it. And he will handle the all the legal issues and all. So as of now, there is no we don't we have not been advised on this.
Speaker #3: But we have, we are working on this. And engineering is on, on this one.
Speaker #5: Okay. Thank you. and, next question on, on, order book basically. On a broad basis, what could be the approximate list split between consultancy and turnkey in FY28 order inflow?
Speaker #5: Should we expect, turnkey order inflow inflow to stay range around 3,000 crores in the next year?
Speaker #3: So typically it remains, this year it is around 25 to 30% is from the LSCK. And this is from the consultancy. Somewhere it generally remains this size consultancy heavy.
Speaker #3: This order book is, the order inflow is being consultancy heavier. But typically it remains 40, 60, 40 is the normal rate for 60% consultancy and 40%, LSCK.
Speaker #3: Generally it remains like this.
Speaker #5: And what about the order inflow for turnkey? It, it will stay around 3,000 crores?
Speaker #3: No, they cannot. Other half are 8,000. And it's around 8,000. And you can presume that around 30%, 40%. From that.
Speaker #5: Okay. Okay. Okay. Cool. and, on the next question is on operating margin. Said you have previously guided around 15 to 16% EBITDA margin. So are you confident on reaching this?
Speaker #5: At the same level?
Speaker #3: Yeah. We are sure to maintain our EBITDA margin because we are executing more and more consultancy segment. And, margins are protected there.
Speaker #5: Okay. Cool. just a last question. any, update on like IOC and Pradeep as to and also on BPCL Andhra?
Speaker #3: IOCL, Paradip as to is still, still to be decided by the government. By the, by the client. Because I think they are looking for the land.
Speaker #3: So and as soon as they sort out the land, then the, the second phase will come. So we'll have to wait depending on that.
Speaker #3: AP refinery, it is, still in the, in the licenses selection and study phase. So let's see. towards the end of this year, some tender or something will come.
Speaker #3: They should come up with the final implementation plan for this.
Speaker #5: Okay. Okay. Cool. thank you. That's it from my side.
Speaker #4: Thank you. The next question comes from the line of Shubham Boradi from ICICI Securities Private Limited. Please go ahead.
Speaker #5: hi. Yeah. thanks for the opportunity. And congratulations on a very well set of numbers. So I, my question is how is the pro-progress on execution for, Dangote order is going on?
Speaker #5: The first one which we got in, January 26th.
Speaker #3: It's progressing well. And a lot of ordering is being done by the client and all. Our teams are also, working on the exhaustive, engineering is on this point of time.
Speaker #3: Teams are deployed there, on the engineering activities. So work is going in full, full blast.
Speaker #5: can we expect some number in, in percentage terms if possible?
Speaker #3: I don't have the percentage of, progress at this point of time, boss. We'll have to see. Because, in this financial, it was awarded somewhere in January.
Speaker #3: And, probably in this financial, we'll have to see. I don't have the pro percentage progress of exactly at this point of time.
Speaker #5: sure, sir. Sure. Thank you.
Speaker #4: The next question comes from the line of Anupam Mukherji from TCN Capital. Please go ahead.
Speaker #5: Hello.
Speaker #2: Yes, sir.
Speaker #5: sir, thanks for the opportunity. And congrats on very strong results. I joined a bit later, so this might have been covered. But, if I look at the consultancy segment EBIT margin, it was 30% plus this quarter.
Speaker #5: So is there any one-off or any, like, benefit from project closure, yeah, yeah.
Speaker #3: Our segment profit from consultancy segment is 30%. And it does not include any one-time item. It is from the it is from the leverages.
Speaker #5: Yes, sir. And sir, typically, when we work on larger projects like the Dangote project, if the margin better for that, do us, like, consultancy segment margin move up?
Speaker #5: Yeah.
Speaker #3: Definitely. with the Dangote project, our margins will move upside only. But, a bit, the Dangote project is still, picking, momentum. So definitely, in the com is coming second half, and in the next year, full, reflection will be there.
Speaker #3: On the profit side.
Speaker #5: yes, sir. a-and sir, a little bit possible to share, like, how much of the order book, consultancy order book of 20,000 crores that we have, will be, like, com get executed over next two or three years?
Speaker #3: Out of 20,000, our 75% is from the consultancy segment. And, 55 around 55% is all from the overseas business. And the, these project will be delivered b-between three to four years.
Speaker #5: Yes, sir. okay. I'll get back in a bit. That's all questions I have.
Speaker #4: Thank you. The next question comes from the li-line of Sanya Jain from Care PMS. Please go ahead.
Speaker #6: Hi. Thank you for the opportunity. And congratulations on the good set of numbers. Just want to state clarity that the recent diagnostic Dangote project that we got for 4,000 crores, given it is a greenfield project, is this project still have the execution, rate of three to four years?
Speaker #3: Yes, ma'am. Generally, Dangote Dangote projects remain for, for four to five years.
Speaker #6: Okay. Got it. And, wanted to know more a bit more on the competitive analysis. What to do in both the domestic and export market?
Speaker #6: What would be can we assume is our strike rate in different sectors? And in both domestic and export market?
Speaker #3: Mehtaji?
Speaker #5: can you repeat this question? I missed out on that question, please. Can you please do that?
Speaker #6: Yeah. just wanted to understand a bit more on the competitive, intensity in the industries. So what would be our strike rate for in both the domestic and export market?
Speaker #3: it's very difficult to say what is the strike rate because, in yeah, we are the leaders. We, we bag we, we beat them, many kind of companies in competition.
Speaker #3: All the mega jobs, we beat them, beat them in competition. And internationally also, there are a number of, brands available. So, it all depends.
Speaker #3: Like, it's very difficult to t-tell you in terms of percentage. How much to get, the business. Our, our target is to get each and every job which we bid.
Speaker #6: Right.
Speaker #3: Market is broad. Yeah.
Speaker #6: Got it. And just wanted to understand if there is a bit any update on the CPSE pay revision? Do we expect any increase for that, labor cost in FY27 or 28?
Speaker #3: Yeah. Right now, they I think there is no commission for the pay revision. So whenever it will come, definitely we'll, take care of that.
Speaker #6: Do we expect it to come by FY28 or later?
Speaker #3: Yeah. We cannot say right now, basically. Right now, there is no commission for that. So we cannot say, say that when it will come.
Speaker #3: It's up to the government.
Speaker #6: Okay. Thank you.
Speaker #4: Thank you. The next question comes from the line of Mayur Parkeria from ScriptBox Wealth Managers Private Limited. Please go ahead.
Speaker #5: hello. am I audible? Yes, sir.
Speaker #3: Yes.
Speaker #5: Yeah. So, thank you for taking my question. And actually, I, I joined the call a little late because I was still believing when I still thought it was 4:30.
Speaker #5: I got late intimation about the revised timing. But anyway, sorry if there is a duplication and, I'm trying to understand more in detail the company.
Speaker #5: sir, I just wa-wanted to understand that, you know, assuming that if the global geopolitical situation settles down, let's say it's assuming. So assuming theoretically it settles down tomorrow, would you say that, from a our core capabilities perspective on refineries and gre gas value chains and terminal, do you believe that the opportunities, post this, has, would increase for us or has it, or will it, remain the same or, has it gone down relative to what it was in the last, four, five months?
Speaker #3: Mehtaji, the opportunities actually, actually opportunities would increase for us when the market is unstable. The project capex investment is not coming. And capex investment is stabilized.
Speaker #3: Then, the opportunity would be, stagnant. So as soon as the market opens, more projects come will get a option of bidding more. And more, market tenders would be out.
Speaker #3: So actually, it is gonna increase for me. With this kind of experience. Because, we have. Sense of international yeah. Tell me.
Speaker #5: Okay. Sorry, sir. Sorry. I, I sorry to interrupt. You can please finish. I'll finish.
Speaker #3: No, no. It is fine. I have concluded my answer. You can go ahead.
Speaker #5: So is it only primarily because the fact that, because of the disruption, the cap the order the tenders are not happening, or al-also or is it also because of the fact that the current war situation has actually disrupted a lot of, refining, capacities, and to that extent, there can be a meaningful jump in the opportunity over the next, one year, once the war situation settles down?
Speaker #5: And for a player like us with, global capabilities and, relationships, the, the, the potential can be much more, is that also a parameter or it is just the fact that the current tenders are not coming?
Speaker #3: No, it is like this. Opportunities somewhere would be going down and somewhere would be increasing. So impact of the market is, yeah, impact of the, the business in the Africa has increased.
Speaker #3: Just because of this, because there's an alternative market created, an alternative opportunity is available to some other manufacturers to producer. So he's setting up projects all around the world.
Speaker #3: So that's an opportunity created somewhere else. At somewhere else, the opportunity has gone down because in the Middle East, no major capex is coming or probably it will take some stabilization.
Speaker #3: so it is it is reduced. But it is it is a temporary phase. Before everything goes fine, then the opportunity will come out and, we'll see because, we will also be participating everywhere.
Speaker #3: Everybody is right now focused on the getting the crude. And getting the crude and managing their internal resources. But, later on, when everything is fine and projects and capex investment would come, India, we have not seen any major impact there.
Speaker #3: Any project has to come, it is coming. There is no visual, project impact on this.
Speaker #5: Okay. so, sir, have you did you in the earlier call, your answer, did you have you mentioned that we were looking at around 8,000 crores of annual order in was that because in one of the answers you mentioned about 8,000 crore.
Speaker #5: I was just trying to understand. Is that, was that your number which?
Speaker #3: We had always told, that we will be in the range of 70, 800, 7,400. Last year's total we'll try to match.
Speaker #5: Okay.
Speaker #3: So we had we are meeting this year also. And we have already crossed that, almost reached that order. the inflow projection. So we are hopeful.
Speaker #3: It will be
Speaker #5: So sir, will it be fair to say will it be also fair to say that despite so much of disruption going on, we are in a position to get this outlook, or we are, you know, our turnovers are, much lower currently.
Speaker #5: Revenue flow to the from the order book, we have already reached 20,000 crore. And we are talking of annual inflows of 8,000. In a normal situation, once this settles down, will it be fair to say that, this number can theoretically or in your, best guesstimate, this can actually materially go up as, you know, is a fair way to look at, or you believe that our target would be only in the region of 8 to 10, 8,000 crore?
Speaker #5: Will, that's how one should look at.
Speaker #3: Nikhil, we will always be optimistic of having the higher number. We will always be optimistic. But, to stabilize ourselves at this point of time to, to what way, way, we look at it, it is the projection we have given.
Speaker #3: But we are always trying to improve on that. And, 15, 20 I think 15%, 20% we are definitely going to increase from the existing target.
Speaker #3: If everything was fine.
Speaker #5: But our op our objective would be to get more as, as more as we can do. Great. Sir, last question from my side. Sir, in the last couple of years, means, you know, while currently we have again started a new cycle over the last three, three or two, three years, and we have seen a good accretion in the order books, which have started, but there was a very big lull period of, you know, before that.
Speaker #5: over these, you know, couple of years, medium term, will can you lay some, qualitative around the, you know, our capabilities which have increased in other segments, which helps us to diversify and open up newer opportunities which can come in over the next two years, three years, not over the next 10 years, but over two, three years, based on what capability enhancements which we have done, anything, any specific, things you can, put a highlight because I have missed that in the previous, readings of mine.
Speaker #5: So, can you just highlight that which can be a potential in the next two, three years for us?
Speaker #3: Definitely. We like like this. It is like this one has to continuously grow. So earlier, lull period you're talking about, it was because of the some, some market assignments were also on there.
Speaker #3: The market was also stagnant. And, not many projects were there. And every company has that kind of phase, from time to time. That was the earlier phase.
Speaker #3: So we have also started strengthening ourselves. We are seeing that kind of diversification we have done. We have not in only dependent on the hydrocarbon.
Speaker #3: We are all across two sectors. We are into infrastructure. We are into ferrous non-ferrous. We are into, now, strategic storages. We are into, going into fertilizer.
Speaker #3: We are seeing all these new segments we have added. Today, infrastructure, contributes to my order inflow around 20, 25%. In between, it was around 40%.
Speaker #3: So the hydrocarbon it is de definitely is the core market for me, but I've also diversified into these segments. I will also go into the fertilizer.
Speaker #3: We are seeing that a lot of fertilizer projects we have gotten in the Middle East, as well as in India also. We are doing, various projects.
Speaker #3: So, so we are also upgrading ourselves at the same time we are training. We are improving the training of our people. Right now, we are, we are, we are focusing on the new segments like new sealers.
Speaker #3: There is opportunities, shown in the market, opportunities there in the market with respect to the nuclear. So we are training our people and making them ready.
Speaker #3: So it's always continuous upgradation depending on the what kind of opportunities are available in the market. So that every every company has to improve upon itself, improving the productivity of its employees.
Speaker #3: So all those factors we are working on. And that has given us the results. So hopefully, it should be better now.
Speaker #5: Okay, sir. Sir, I'll come back in the few and thank you so much. Wish you all the best. And great set of margin performances.
Speaker #5: Thank you.
Speaker #3: Sure. Thank you.
Speaker #2: Thank you. The next question comes from the line of Anubhas Mukherji from Precient Capital. Please go ahead.
Speaker #5: sorry, sir, again, like, I, I also joined at 4:30 because somehow the meeting was, like, showing up at 4:30 on the calendar. sir, if you could share, like, what are some of the large, domestic consultancy order, that you are expecting, in the next one year or so?
Speaker #5: if you haven't already covered that, if you can take, take us through that, that would be very helpful.
Speaker #3: You would say this or you are already aware that, there is an AP refinery which is coming, so it'll be targeting that one. Paradeep is on the Envil.
Speaker #3: It's a phase two concept would be there. there are various, minor revamp projects for BPCL and other pro other, other refineries is there. Then there is an, there is an opportunity for the strategic storages.
Speaker #3: We are targeting there. We are working in the non-ferrous met non-ferrous segment. We are targeting some opportunities out there because there are some, some companies are thinking of putting up a million smelter and all.
Speaker #3: So all these segments we are working, infrastructure, there's a lot of investment out there. So we are, we are to working towards it. We have recently got a data center project on UV basis, a data center for one of the clients, Power Grid.
Speaker #3: So these opportunities are there and we are trying and, we are getting the assignments also. So that, we are working towards it. Similar kind of project.
Speaker #5: thanks. And, and also, for, like, overseas consulting, projects, how do, like, margin for those projects compared to, like, domestic, like, are, are, are those typically higher margin projects or in line with the domestic consulting projects?
Speaker #3: Our consultancy margins remain the same generally remain the same. We don't overcharge anyone. It is always remains the same segment and almost in the same way.
Speaker #3: Somewhere we make it good.
Speaker #5: Okay. Exactly.
Speaker #2: Thank you. The next question comes from the line of Darshin Shah from Multi-Act PMS. Please go ahead.
Speaker #6: Hello. am I audible?
Speaker #2: Yes, sir.
Speaker #6: Yeah. so just, one question. so based on this 8100 crore order inflow that we have till date, so around incremental 670 crores of order inflow, what would be the split between consultancy and Turkey, Turkey?
Speaker #6: Would, would it be largely consultancy segment?
Speaker #3: Yes, it is typically, more of consultancy side.
Speaker #6: Okay. Okay. And, one more question on, the credit terms, right? So for the international, consultancy segment, what are our credit terms, specifically let's say for Africa?
Speaker #3: Credit terms means, what is it classified like to understand credit terms? Payment terms?
Speaker #6: no, in terms. Yes, yes, yes.
Speaker #3: Payment terms are fine. They are always progress linked. The with respect to the over engineering progress as well as the project progress. They are mixed of.
Speaker #6: Yeah, no. In, in terms of, is there a letter of credit or, you know, I just wanted to understand.
Speaker #3: No. No, it's like this. not necessarily you need a letter of credit for that. Most of the clients are known in the Middle East and also they are reputed brands.
Speaker #3: They were default on the payments and all.
Speaker #6: No, specifically I'm, checking on Africa.
Speaker #3: In Africa, we have been working with this client for a long time. So we know the stability and before entering into any of the agreement, we also do our due diligence that, is paying capability.
Speaker #3: We always check. We don't work with the unknown clients. we verify their credentials.
Speaker #6: Sure. Sure. Okay. Thank you.
Speaker #2: Thank you. The next question comes from the line of Deep Sangvi from Retail and Broker Stock Broking Private Limited. Please go ahead.
Speaker #3: Yeah, thank you so much for the question again. so my question was regarding, this. out of the 8100 crore order inflow till date, how much would be, from the Middle East from this?
Speaker #3: 8100 crore is, Middle East would be, a little bit limited. Something around, 500 crores or so. 500 or 600 crores. So we haven't received any orders in Q2, right?
Speaker #3: Because I think in Q1 also it was the same kind of. Smaller orders. We have got smaller orders that I think. Right. And, just, follow up to that.
Speaker #3: So MD, sir, in the agent has said that, there's, in the kind of two to three year of, like, range, there's a, almost around a billion dollar of opportunity in the Middle East, regarding the strategic storage projects and all.
Speaker #3: pipeline projects as well. So are we bidding like, are we bidding for these projects there and, if, if there will be any projects we, we will definitely bid, right?
Speaker #3: No, no, definitely. There's a lot of opportunities out there provided all that market stabilizes. There's a number of, tenders we are bidding for. We use PPC contractors.
Speaker #3: Hopefully, let's see, the results come because these are long decision, bidding cycles. So they come in time to come. We'll let you know. But the opportunities are there.
Speaker #3: Provided everything stabilizes. Sure. And, sir, just the last, question from my side. I know, one of the people have asked this before, but if you can please guide any, you know, bro in a, in a broad range as well, that'll be fine.
Speaker #3: Because, we generally, aim for 8000 crore per year of order inflows, right? So, if you can guide something for the next fiscal first fiscal 28, that'll be very great.
Speaker #3: Thank you. Next financial year, it will be at least minimum 8100 crores. 8000 crores or more. Perfect. Thank you. Thank you so much, sir.
Speaker #3: Thank you. And again, a great set of numbers. Yeah. Thank you so much.
Speaker #2: Thank you. Ladies and gentlemen, we will take this as the last question for today. I now hand over to the management for closing comments.
Speaker #2: Over to you, sir.
Speaker #7: Hi. Thank you. Thank you very much. Thank you very much.
Speaker #3: Thank you so much. Thank you.
Speaker #7: Yes. How we, we could meet the expectation of our investors?
Speaker #3: Thank you, everyone. Bye-bye.
Speaker #2: Thank you. On behalf of engineers India Limited and Dam Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
