BESS launched as new product narrative.

Will BESS be largely targeted at C&I customers for auxiliary power, and can you also offer utility-grade BESS solutions for grid stability?

We're starting with C&I customers - the nodes we have launched are for C&I customers. We will showcase our value proposition to our customers and then take calls on whether to go to utility grade or not. We will absolutely evaluate that as we go along in the next few months.

On the strong Powergen growth this quarter despite May being impacted by Operation Sindoor, was there any one-off project order-based revenue or is it just core G-Drive growth?

This is core G-Drive growth. There's been a lot of focus across all segments in the market, a lot of stabilization in the CPCB IV+ product and good order building and execution. Great execution as well to deliver what the market needed across the board. No major project business booked till this quarter.

Any color on pricing, utilization and volumes of CPCB IV versus CPCB II? You said you were tracking at 85% earlier - how has volume stabilized and have you seen pricing correction?

From a volume perspective, we are back to pre-CPCB IV+ volumes now in the market. From a pricing perspective, there is now a good settlement of pricing in the market. There is a lot of competition still and that will continue, but pricing more or less seems to have settled. Our endeavor is to continue holding on to prices, evaluating on a deal-by-deal basis based on customer needs.

On the 30%+ Powergen growth - is it broad-based? Which segments are sustainable on the Powergen side? And does this growth look sustainable?

Powergen growth this quarter was very broad-based. Key segments that did well include quick commerce which continues growing, and the mission-critical segment including government infrastructure spend-based segments like roads, hospitals, airports, manufacturing and pharma. The growth is very broad-based and this looks sustainable.

On exports - is the bump up because of pre-buying or are markets settling and inventories normalizing? How are you thinking about exports going forward?

We are still cautiously optimistic on exports. There are still various geopolitical issues. The reason exports have been performing for us is because we've been focusing on end markets and what products they need, running specific projects to improve product positioning. So this is a result of focused efforts, not necessarily all markets picking up demand. That's why we stay cautious about exports.

On the distribution segment growing 19% - is growth largely due to new product launches like DF kits, RAS, power management, DGBlue, hydraulic filters, track recording car and hotel load converter? Can you share TAM for new products?

The distribution business growth is primarily due to better penetration in Powergen and railways, better execution and is broad-based. The new products have started to contribute, but I would not say growth is primarily based on new products. It is based on better penetration in traditional Powergen and railway segments and providing better aftermarket solutions to our customers.

With CPCB IV+, will consolidation happen in favor of branded players in aftermarket business and could opportunity be higher for distribution business given electronic content?

You are absolutely right. That gives a better opportunity because the products are technologically more advanced than what we had in the CPCB II era. The products are more advanced and will require better aftermarket support and technically strong teams on the ground to help our customers. So you're right, it could lead to better opportunities.

Can you give the breakup between HHP, MHP and LHP sales in Powergen during the quarter?

Low horsepower for this quarter is INR84 crores, medium range is INR229 crores, heavy duty is around INR115 crores, and high horsepower is INR628 crores, totaling INR1,056 crores for the quarter.

Is data center sales contributing more than 20% of HHP Powergen? How are you seeing data center sales this fiscal year vs last fiscal?

Data center is 15% to 20% of overall Powergen sales, not just high horsepower. We have been seeing steady growth in the data center market comparable to the rest of the Powergen segment growth as compared to last year.

Some color on the Industrial side - subsegments like mining, construction, compressor and breakup for the quarter?

For this quarter, Construction segment clocked INR147 crores; Rail INR148 crores; Compressor INR56 crores, totaling INR418 crores. Railways performed really well owing to orders for diesel electric power cars. Construction had steady growth though some projects were affected due to early monsoon. Compressor segment continued on steady demand, comparable to last quarter.

Have you been able to cater to all data center demand given imports of higher nodes? With Caterpillar picking up share due to shorter delivery timelines, what are you doing to shorten timelines for imports of nodes 3,000-3,500+?

There's a lot of work going on to shorten lead times on those nodes, not just for our market but worldwide. We are also working with customers to generate orders in advance and deliver based on their site readiness. We have been able to fulfill the demand that has come our way - we have definitely not lost because of our inability to deliver.

Will data center demand continue this way given you didn't specifically call out data center in earlier sectors?

Demand from data centers is continuing. I specifically did not call out data centers because that has been steady for the last few quarters. I only highlighted some segments that did really well this quarter. Data center demand is steady and continuing for the time being.

Are there specific areas where you've seen demand drastically collapse or significantly reduce, including inquiry levels?

We haven't seen any segment dropping demand to the level that it comes to our notice. It's been quite broad-based. No such segment like that.

On flexible fuel engines - are we ready to launch them in India? What is the potential?

We have something we are working on globally called HELM platform. But right now, we do not yet see the need to launch it. Given Powergen segment is the most important and growing segment that might require options beyond diesel, there is a dual fuel kit available to help customers try diesel along with gas. The dual fuel kit is already launched in the market, catering to customers who want gas as well as diesel as fuel.

Clarification - is the 31% Powergen growth without any project business revenue this quarter?

There is project business revenue in it. There are no one-offs. The question was around one-off growth items - there are no one-off growth items, but definitely there is project focus in that.

What is the composition of CPCB IV engines now in total Powergen mix and revenues this quarter? Will it be 80-85%?

Below 910 kVA is fully CPCB IV+. Of the full domestic Powergen business of INR1,000-odd crores this quarter, roughly 60% is CPCB IV+ and 40% is non-CPCB.

On hydrogen electrolyzers - any update? Any traction from customers wanting to try out Cummins electrolyzer products for power backup?

Hydrogen electrolyzers are not for power backup. Hydrogen electrolyzers are just to generate hydrogen for the customers. That is not something that we've heard too much on in the market in the recent past.

Is your data center growth concern related to demand from a large U.S. IT company coming down because of AI, given higher exposure to that customer? Worried about FY27/28?

No, we are not worried about that. We still have a robust order board on the data center from all different kinds of data center players, be it the ones from the U.S. or be it the ones from India. There is a strong order board on the data center side.

Clarification - you said Powergen revenues are back to CPCB II levels. How far away is the market to reach that stage and can it happen this year?

My comment was not about Powergen revenues. My comment was about overall market volumes. Overall market volumes at this point in time are back to CPCB II levels. That was what my comment was about.

Can you summarize growth across segments and which factors lead to it? Specifically Industrials and Powergen.

On Powergen, segments like quick commerce, mission-critical (hospitals, roads, airports), manufacturing and pharma have presented opportunities and continue to grow at robust pace - across nodes. On Industrial business, demand from railway diesel electric tower car and power cars continues. Construction was impacted slightly by monsoons but steady. Distribution business continues at similar growth. Given domestic economy performance, we believe this will continue at least for some time.

From last year, what changes are there given CPCB IV stabilization and disruptions behind us? Where is market opening up and what is our USP/advantage?

On USPs, in Powergen we have very good customer relationships built over years. Brand promise on reliability and innovation works in our favor. CPCB IV+ product being technologically advanced is well accepted. Aftermarket support is well appreciated. On Industrial side, our execution ability for customized tender-based orders and aftermarket support over long periods are key USPs that are well accepted by the market and showing growth areas.

Looking at last couple of years - we've done well on growth and tight on costs (employee costs, VRS etc.). For next 3-4 years growth, how should we look at costs - are we rightsized or need to rebuild capacity? How should we think about capex utilization?

We have been focusing a lot on costs and working hard to optimize costs to the right level - employee cost and other spends will continue. Capacity-wise, we have been putting capital into upgrading and expanding lines continuously over last few years and that will continue. Capacity utilization is around 65% to 70% but that's because we've been continuously putting capital. Going forward, we will have leverage gain due to optimization, but also continue investing to fuel future growth.