Analyst · Elara Capital
If I understand correctly the timing for this short cycle order in terms of what gives you the confidence
No, I said, no, the order book that we are expecting in 2026, Mining will contribute around 20% to it. If you look at 20% of the total order, and if you look at FY25, the contribution of mining was 54%, which has gone up significantly. And one of the major reasons was that since Rail was not able to perform, we had to ramp up Defense as well as Mining. So Defense saw phenomenal growth of around 40% with the contributions increasing from 19% to 27%. And mining saw a contribution growth of 11%. If you look at the long term perspective, even 2025-26, the expectation is mining will be around 40% and Defense plus Rail and Metro will contribute around 60%.
Analyst · Elara Capital
Is it safe to say that 20th also.
we will not end the year at Rs. 28,000 crores order book. We will end the year at around Rs 22,000, Rs 23,000 Crs, because had an order in-flow of around Rs 6,800 crores, which was a growth of around 28% as compared to FY24. This year we expect to have at least a double or little more than double ordering flow as compared to FY24 in FY 25.
Analyst · Elara Capital
is that right? 20% mining, 20% defense, 60%
Rail and Metro can be a little bit more. Also, defense can be a little bit more also because we are now expecting some emergency procurement orders which will be there with us in another couple of months from now, so we can expect a little bit more contribution of Defense in the 25-26 Order book.
Analyst · Elara Capital
where was the Bangalore Metro?
Bangalore Metro was never supposed to be delivered in FY25. It was always supposed to be delivered this year only, FY25. We were supposed to deliver the Vande Bharat. Since the testing and the CCRS inspection of the 1st prototype have not been completed, we could not deliver the balance 9 trains, but the car body shells are already ready for all 10, and this year, July onwards, we can start delivering the balance Trains. Apart from that we will be delivering some Catenary maintenance vehicles also. Some numbers we have already planned. Apart from that, we can expect some orders for the Link Hoffman Bosch trains, and out of which some numbers we'll have to execute in the current financial year.
Analyst · Elara Capital
So that is the future perspective for Metro?
Starting July onwards, we will deliver all these trains by the end of this year by December. That is what we are looking forward to? Because already the 1st train has been inspected in April, it has got all the clearances, and now it is only awaiting the clearances where it is going to be allotted to run. The train is already in. Maybe any day it can be announced where it is going to be run, because it is the 1st sleeper train of one. Apart from that, we are expecting some orders for the LHB coaches out of which, something like 150 numbers we want to deliver this year. And we will be starting the delivery of Metro by September, October trains will go. We have plans to send around 20 train sets this financial year.
Analyst · Elara Capital
What about the Capex?
Rs 200 crores last year itself we have spent. There was a time we used to spend 50 crores 3 years back. Now we are spending 200 Crores this year. We are supposed to spend around 600 crores. If you spend around only 200, then these kinds of capacities will take us years to build, and we cannot afford.
Analyst · Elara Capital
Will the Inventory become 0?
No, it will not be, I did not say it will be 0. We are not in the JIT world. And as a PSU, we cannot work on JIT concept. What I meant was that any inventory more than one year, 2, 3 years, or beyond that, we are trying to make it 0. The overall limit can never be. 0 number of days is, you know, aspiration is 90 days, which is again very difficult for us.
Analyst · Elara Capital
What about Capex and how you are going to fund the same
Rs 220 crores we spent last year. As of now we have not thought of any debt for our existing facilities. But yes, for the Bhopal plan, we are definitely looking at the partners who can do the debt funding. Already some financial institutions, some PSU banks have also shown lot of interest in fundingit. Capex planned is 1800 crores, but that will be in 5 phases. The 1st phase will be around 225 crores. The idea is to start rolling out the trains from there at the earliest, within 12 to 14 months, so that the cash flow is positive it starts becoming positive.
Analyst · Elara Capital
What about reducing the Employee cost
As already told, we are looking for somewhere 17 to 18%. It's a challenging one. At the same time we need more people, but with the increase of turnover, we will bring down the employee cost in percentage terms. Around 17%, with the increased wage cost, it has to be around that minimum, we cannot afford to increase it. Achieving 17% is a big challenge.
Analyst · Elara Capital
Can you hold one Investor meet every quarter.
One conference within December. We are having one in June now, one in December, in between also, as and when there is a request. I always, you know, have a conversation, either, virtually, and if somebody wants to come over to Bangalore most welcome. That's just something that we need to do. So if you want, we can do this on a quarterly basis. But generally, what happens is after every quarter, I have 2, 3 media interactions.