Dilip Buildcon Ltd Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Yeah. Thank you for the opportunity and congratulations on our debt reduction. So that's the most important thing. Sir, couple of just some clarifications and then the questions. So we are seeing that are 5% to 10% revenue growth for this year. So fourth quarter then at least for to achieve our 5% also, we need a INR3,000 crores-plus kind of revenue. So this quarter we have done closer to INR2,570 crores. So we are confident that we kind of crossed INR3,000 crores-plus kind of revenue in the fourth quarter.

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. And in terms -- also the margin now will be -- is there are still a possibility that this margin will inch up to 13%-plus kind of number, so 12.4% for nine months. Also, it is a 12.4% EBITDA margin. So is that a possibility that maybe in next year we can see a 13%-plus kind of a margin?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay and moving them from now in terms of the order inflow, that is for across all of almost all companies are facing because there is a slowdown from NHAI side. So just a couple of things. So how much now so we have received for just INR2,140 crores-odd EPC value in terms of order inflow. So how much more we can look at the next 1.5 months? I also -- how much value of projects we have already we did where maybe you have to plan and how much more we are planning to bid. And if you can broadly classify in terms of which sectors water, irrigation, metro, Any other sectors?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. Sir, in water also are we are we seeing other states are already there for election is over. So MP, Rajasthan, Chhattisgarh or is there any scope even for UP also?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. And now it's definitely a good thing that the debt we have, we have reduced INR500 crores-plus -- INR531 crores-odd. So by this year another, we will see a INR300 crores kind of a reduction in the fourth quarter and hopefully the last time as we guided and this time also, we guided that we will be up net debt free by FY25. But in FY24 how much more reduction can possible because in your opening remarks, you said that the Alpha alternative last quarter we were looking at getting up FY25, I think the higher cash inflow and now we are seeing some may spill over to FY26. So if you can help us with that?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. Just to understand further. So InvIT broadly, it will be by second quarter of FY25, we will be able to set up and the INR400 crores, INR500 crores kind of annual distribution we are seeing. So if, let's say, this InvIT get set up even in the end of second quarter of FY25, then also this INR400 crores, INR500 crores distribution can come? Or this is the annual number? So this would be our FY26 level one can look at INR400 crores, INR500 crores kind of annual distribution?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. And in terms of -- obviously, it's a grade that are slowly, even our working capital also, we are reducing so 67, 68 days. So we said last time also that 8, 10 days more reduction is possible. So even in Q4 also, we can see here some further reduction is possible in working capital? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2024 / 12:30PM, DIBL.NS - Q3 2024 Dilip Buildcon Ltd Earnings Call

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay, so major possibility would be that in FY25 and not maybe in this quarter, maybe or one or two days is possible but 5, 10 days, if one can look at it would be possible in FY25?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. Got it. And sir, whatever the number of pending appointed date and we have already mentioned in terms of the likely February, March, we will be getting this year. So just trying to getting understanding in the sense that a just because of the election, will it be getting appointed it? Or will it be coming even post of April, May? So there can be a further delay in the appointed date. And so net revenue for FY25, will it does get impacted by that?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. And lastly, so broadly, in FY25, we can still a base on this and whatever, let's say, even the order inflow doesn't come fully this year. Next year, hopefully post-election, it will come. So we can see up 8% to 10% kind of revenue growth in FY25. That's the way we are targeting?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay got it. So it's the similar 5%, 10% kind of growth one can look at in FY25 also? And the CapEx till nine months, we have done INR104 crores-odd. So INR20 crores, INR30 crores more one can expect in the fourth quarter? Or is it mostly done in the nine months CapEx is the full-year number?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. Thank you and all the best, sir.

Question: Prem Khurana - Anand Rathi - Analyst : So my first question was with respect to one of the press releases that we've given out on February 8. This pertains to some notice of claims with the invocation of arbitration. And I just wanted to say with respect to the asset that we told [Cube], would you be able to share some more on this and why exactly is this matter?

Question: Prem Khurana - Anand Rathi - Analyst : Completely agree, but do you have any payments due from Cube. And I realize that you have received a large payment but generally, most of these cases you tend to have some of these deferred payments linked to some GST, change in law --

Question: Prem Khurana - Anand Rathi - Analyst : Everything is recovered right? And on the prospect pipeline that you spoke about, INR130,000 crores, would we be able to kind of break it out into how much of this would be EPC, how much HAM and BOT and given the fact that by next year we will be as good as zero debt company. Would you be willing to kind of go and explore BOT toll because there I am assuming and the comfort the competition be a little lower than I mean compared to EPC or HAM. So will you be able go and explore BOT toward once the balance sheet has delevered?

Question: Prem Khurana - Anand Rathi - Analyst : Sure. And then whether you're planning to create where mandated enough acquire any sort of PPP projects, whether it is not restricted only to HAM. I know your company, but I'm not sure about Alpha Alternatives, whether they would be comfortable to BOT toll or not. And if you have any mandate in place, wherein it restricts the asset addition only to a single category, let's say, HAM or is it open and you can consider BOT as well?

Question: Prem Khurana - Anand Rathi - Analyst : And I mean the fact that the balance sheet has become very, very light now and it is supposed to go lighter even further. Any thoughts on accelerating growth and in between because you want to conserve cash, the idea was to delever. We went a little slow in terms of growth. I mean, even this year we are [5%, 8%-odd] sort of number terms of growth. Could you think of accelerating? And would that needed to kind of invest more in capital or at a footprint or to working capital (multiple speakers) What should be the ideal number when you look at growth, I mean, I'm sure you won't settle for [5%, 8%-odd], the idea would be to kind of grow better than that number for sure. But I mean, any thoughts there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2024 / 12:30PM, DIBL.NS - Q3 2024 Dilip Buildcon Ltd Earnings Call

Question: Prem Khurana - Anand Rathi - Analyst : I have two more, may I please? One, I mean both our bookkeeping, so one is we have some exceptional gains during the quarter. What the tax implications is exceptionally, how much would be the number in our tax for the quarter, which would put into the exceptional gain? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2024 / 12:30PM, DIBL.NS - Q3 2024 Dilip Buildcon Ltd Earnings Call And second is I'm not sure if you gave any guidance for the peak for the year FY22. I mean, you spoke about some of these tenders are kind of getting bid out now Q1 or Q2. But then do you have any target for this year because it's been only around INR2,600 crores-odd?

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Thanks for the opportunity. Sir, on the footnotes, there are a couple of clarification, if you can provide that one is Shrem units that we have sold. So is this the first such transaction you've done or have you done this before also?

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Okay. And I mean, would it be fair to say like, you know, it's more of a opportunities in front of you or any such things planned to the parties to whom we are selling in FY25 for anything that is in particular?

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Okay. So is it like to individuals or institutions. I think without naming it? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2024 / 12:30PM, DIBL.NS - Q3 2024 Dilip Buildcon Ltd Earnings Call

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Great. And then secondly, I think there's one more footnote wherein you mentioned that incurred a loss of some amount. So is that fair to understand like you know, the total amount received is something like INR57 crores or INR67 crores-odd, loss is like INR44 crores. So something we have done

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Okay. So basically, it's not for one particular project one should look, it's a portfolio and the deal has concluded in December 31. So maybe like in combined total, this is probably that you've booked?

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Got it. And then one last thing I think you probably would have covered this in previous calls, in the coal mine when we do a starch extraction and we are probably doing a INR1,500 crores in FY25, what sort of margins that we can make and as the mining increase in terms of the million ton increase, does the margin also expands?

Question: Vishal Periwal - IDBI Capital Markets & Securities Ltd - Analyst : Okay. So that's a kind of peak, probably INR1,500 is the 20%, you are saying.

Question: Manisha Agarwal - Middlecon Advisors - Analyst : Hi, sir. Actually, I just I joined the call a bit late, just one bookkeeping question, but kind of what is the trajectory of our interest or going ahead?

Question: Manisha Agarwal - Middlecon Advisors - Analyst : So do we have like any target going forward for FY25 or FY24 in terms of finance costs?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : Thanks for the opportunity. Sir, we mentioned that we have received a approval from the authority regarding the change in law of GST for three assets. So the claim amount is around INR209 crores. So against that we have booked income INR64 crores. So when do we expect the actual cash to come in?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : So we have booked the present value of the same amount of INR209 crores pertaining to the three assets that were sold to InvIT. So when do we expect the actual cash to come in under the different consideration?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : That INR64 crores will be receivable by when or we have already received the amount?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : Okay. And secondly, when do we expect to receive the balance amount of the warrants, 75% warrants?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : I guess how do you factor that around INR500 crores, INR600 crores we are expecting from Alpha in FY25. So are you factoring anything from that trend or that would be expected in '26? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2024 / 12:30PM, DIBL.NS - Q3 2024 Dilip Buildcon Ltd Earnings Call

Question: Vaibhav Shah - JM Financial Ltd - Analyst : Okay. And sir, what is the tax rate that we can expect in '25 and '26?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : I am asking about tax.

Question: Vaibhav Shah - JM Financial Ltd - Analyst : Okay. And sir, lastly, for the initial 19 assets that we are under deal with Shrem and Cube. What is the amount sitting in our balance sheet as of Q3?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : So our investments and loans in the books are for the current portfolio now, apart from that amount for Pathrapali?

Question: Vaibhav Shah - JM Financial Ltd - Analyst : Okay. So apart from that, there's nothing above all the other 19 assets that we already sold are under the crossover.

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Sir, just a clarification, you mentioned that in your other expenses, there was a INR10 crores to INR12 crores one-off. What was this related to?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay, got it. So this 35% tax rate at that P&L level will be there for FY25, FY26 also, this rate will continue or we will be moving to 26% tax rate in '26?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. And DBL infra debt as of December is how much?

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Okay. Previous two participants has also asked. So we are just trying to figure it out in terms of the finance costs in terms of absolute levels. So this quarter was INR129 crores-odd. So by end of this year further whatever INR300 crores-odd, a debt reduction and next year also, we are looking at INR800 crores kind of a gross debt reduction. So in that scenario in FY25 at finance cost level and how one can look at how much more reductions? So this year will be a INR520 crores, INR530 crores-odd. So will it reduce by INR130 crores, INR150 crores-odd, at least minimum? So that's the game we are trying to understand.

Question: Shravan Shah - Dolat Capital Market Private Limited - Analyst : Thank you. And all the best.