Hi. Good evening, sir. Sir, my question is again on these additional costs. If my memory serves me right, we had started working much more actively with modern trade in fourth quarter of last fiscal. We didn't see costs spiraling up as sharply in the first half of this fiscal as we have seen in the third quarter. Or is it that in the first half because we had very strong growth because of operating leverage we didn't really see the impact in EBIT margins, and in third quarter, we have seen a much more pronounced impact?
Questions across 42 calls
Aditya Bhartia
Investec
Voltas Limited
Larsen & Toubro Limited
Sir, my first question is on the status of the submarine tender that we wanted to participate in. There have been some media articles around that. So if you could just clarify about what's really happening over there? Subramanian Sarma: Okay. So there are media reports on this matter in the public domain. We cannot comment further as the matters pertaining to the bid are subject to an NDA. We have also sort out some clarification with the customer. But unfortunately, I'm not in a position to comment further on this particular matter because of non-disclosure agreement compliance.
Sure, sir. Understood. So my second question is on margins in the Infra vertical. It has been a while since margins have been hovering around this range and we have not really seen a big expansion. Do you think this is a new normal wherein we are looking at lower working capital, but that also kind of entails lower margins? Nothing wrong with the str ategy, just trying to understand if this should be seen as a new normal.
So, if we look at our order inflow guidance, we are looking at almost 20% order inflow growth in H2 while our prospect pipeline is down by almost 10%. So, what is really leading to it? Are we anticipating a higher market share or are we anticipating a higher chunk of those tend ers actually getting converted into orders? Finalization is happening quicker.
And sir my second question is on Power segment. There have been some media articles about us winning some orders from NTPC. So, just wanted to kind of know is that correct? Is that not correct? And while you mentioned that you'll not be unde rtaking any EPC orders, how serious are we going to be on BTG orders on the power side, on thermal power side?
Hi, good evening sir. Sir my first question is on the reduction in prospect pipeline especially on the Hydrocarbon side. Now given that we are having a 10% reduction in overall prospect pipeline and we require almost like a 10%, 12% kind of a growth in order inflows to meet the guidance, where exactly are things changing? Are we anticip ating a much better strike rate in the domestic business which it appe ars had fallen a bit last year o r is it that we are seeing competition being a little lesser on the domestic side this time?
Sure. Sir, the second thing, you've spoken about labor availability issues and the potential of that to be slowing down execution. Where exactly are we seeing challenges and have they worsened over the last year or so?
So, just to kind of confirm, w hen you are speaking about power sector, it means that we are largely going to stay away from ordering and which kind of gets reflected in your prospect pipeline that you also spoke about being only around 0.5 trillion for the power sector. Is that understanding, correct?
Sir, second question on our order in flow growth that has been built into for FY’25. We are expecting a decline in international orders, which means that despite elections which can potentially impact H1, we are building in almost , let's say, 13-14% kind of growth in the domestic business. Even in FY’24, we estimate that overall ordering in the economy is likely to have remained strong. It's possible that L&T lost out some large orders maybe because of competition. So, what are we really seeing as changing in FY’25?
Sir, just wanted to understand once again, what is really happening on the domestic order inflow side? Not only in this quarter but pretty much in the last three quarters , it has been quite weak while you have been kind of commenting that overall Capex numbers are looking good, which is what we are seeing otherwise as well. So, why is it that L&T is not winning orders?
Sir, what you are trying to highlight is that overall economy level ordering itself would have been quite weak and it's not as if L&T has l ost some orders to competition or the smaller guys have become more active. Pretty much, economy level ordering itself would have come down.
My first question is on the two large hydrocarbon orders that you've booked. Have there been any customer advances that we have received on those orders? And what is our internal margin expectation for orders of these sizes?
Exactly my point, sir. So on the domestic core business there's been quite a sharp deceleration in first quarter, we are seeing almost something like 35% revenue growth. This quarter, it seems that it's been somewhere between 5% to 10%. So is there something that's really happening over there? Because in first quarter, we had spoken about very sharp pickup in execution space, both in domestic and international and also spoken about some labor constraints we faced in the domestic market.
Amber Enterprises India Limited
Just wanted to understand these new customers that have been moved from gas charging to ODM solutions. How large could those customers be and how much they may have contributed in third quarter and nine-month of this fiscal?
Sir, the reason why I was asking is that like you mentioned room AC category grew by 71%, just wanted to kind of get some sense how much would have existing customers grown by and how much these new customers could have contributed. How relevant are these customers in the overall scheme of things?
Just wanted to understand how exactly is it panning out on the in-sourcing side from customers? Is it fair to assume that for some of them, given the facilities have become operational this year, they will be in a ramp-up phase and next year, they will possibly be doing a lot more in sourcing than what they have done this year?
Understood, sir. And my second question is related question on margins. So if we look at this particular quarter, wherein we had a very strong growth even in standalone entity, which houses ACs and largely durables. Over there despite that strong revenue growth in terms of margins, we actually didn't see any expansion. So there would have been operating leverage benefit, which would have played out, higher proportion of components would have been the case in this quarter. So there is no EBITDA margin expansion and at the gross margin side, there is a bit of an erosion. So how should we think about profitability going forward?
My first question is on the electronics side, wherein you mentioned that there were some delays from getting customers onboarded and getting some approvals. If you could give us some more details about what's really happening over there ? Usually, consumer durable kind of business should not have gotten impacted whatever we were thinking was in addition of that. So is it that we are seeing some challenges on the con sumer dura ble side as well ? And amongst all the additions that we are doing, where exactly are we positioned and how are you seeing growth for that division going forward?
When you are speaking about doubling revenues, you are considering revenues of acquisitions that we have also done?
Dixon Technologies (India) Limited
Sir, my first question is on the KHY acquisition. In respect of that acquisition, you spoke about some export order. Could you just kind of explain how large is the opportunity? What are we looking for? Is it just capacity expansion that we were aiming in Ismartu facility, which is why we kind of acquired these assets?
Understood, sir. Sir, my second question is on the fab manufacturing facility. Just a couple of quarters back we had started -- or we had started speaking about display mo dules and now we are speaking about complete fab. What has really changed? What kind of capex may be required for this facility? And do we get any kind of soft indications from customers as to what their offtake could be?
So, on the mobile phone segment we have seen a very, very sharp ramp up this quarter. So, just wanted to understand how much seasonality is involved. Like you mention ed that post Diwali there may be a bit of a slowdown. We have hit the run rate of 2.7 to 2.8 million phones per month. So, how slow does it typically fall to and then how sharp is the recovery in 4th Quarter?
Understood sir. Sir, secondly, on the components ecosystem, can you ju st give some more indications about how we are planning it , which all components can we get into , what kind of CAPEX are we ready to put in . Can any of the components be significantly CAPEX intensive, or are they going to be more or less similar to the HKC kind of an arrangement that we are having?
My first question is on the Consumer Electronics segment. If we exclude the refrigerated revenues, TV revenues have fallen by 18%, 19% this quarter versus the same quarter last year. What would that be on account of and a related question on margins in the refrigerator business? Given that it's an ODM business with significant growth -- significant capex, we were anticipating quite high margins in this product category. But it seems at least in the first quarter which may be because of teething issues those margins haven't come through. So, you could just explain how exactly we should be thinking on that front?
Understood, sir. And as we are moving towards the peak season for TV, are you seeing order book looking a lot better?
Sir, you spoke about vertical inte gration in the mobile phones business. It would be great if you could share some more insights into this, what exactly are we planning? What kind of an opportunity would it be? What kind of margins it could be pay? Anything that you can share around that?
And this will likely be in a JV kind of a form. And does that also mean that we' re incrementally becoming more open and more excited towards getting into the component ecosystem?
My first question is on the mobile phone side. We hav e obviously started a few new facilities like that of Xiaomi, and we are also constructing a fairly large [inaudible] almost 1 million square feet kind of a facility. So how are we thinking about structuring this business? Would some part of the existing b usiness be moving to a larger facility and we'll let go of some of these facilities? Or are we anticipating new business to be large enough to be filling in such a large capacity?
Understood. That's helpful, sir. My second question is on performance this quarter for segments othe r than mobiles, which appears to be a little soft. Lighting, obviously, you mentioned some of the challenges. But even on the TV side, given that we had a slightly delayed Diwali, maybe one could have expected slightly stronger volumes. So is it that the market is going through a fairly dark slowdown? Or is there something more to it? And also a related question, in categories like, let's say, wearables or IT products, which are just in the nascent stages, this quarter has been a bit weak. So what are you s eeing on that front?
Azad Engineering Limited
Sir, my first question is also on the new large contracts that you have got from companies like Mitsubishi and Honeywell, now these have been our existing large customers ’ and we have already been executing orders for them. So, just want to understand these new orders should be seen as something which is completely incremental to what we were already doing, or part of the existing business gets consummated in th e new order wins that we are speaking about, especially for Mitsubishi, given that is a fairly large order?
And one should assume?
Kaynes Technology India Limited
Hi, good morning, sir. So, in the last few quarters we have seen a fairl y strong growth in the industrial vertical which I guess was driven by EV customers that we had a dded. How are we looking at this particular vertical in the second half given that we are a lready having a decent base of EV customers? Is it that smart metering will continue to drive growth for this vertical in the second half as well?
Understood sir. And sir if we were to be speaking about...
Havells India Limited
Sir, you spoke about advancement of A&P. But if you look at the overall A&P spends, they have ranged around 3% of revenues, which historically has been at the usual run rate. So while I understand that there is an year -on-year increase, but how should we look at A&P since going forward? Are they going to moderate once the season is over and from a slightly longer term perspective?
And sir, if we look at the contribution margin across segments, on the contribution margins, margins look pretty okay with some moderation in the wires and cables. But when we look at EBIT margins, the difference is a lot higher. So , which are those expenses which would have gone up? I understand that there could be that INR28-odd crores of impairment that we have taken. But besides that, is there any other expense that won't be forming part of contribution margins, but of EBIT margins, which is impacting the margin?
Sir, just wanted to understand if there were any capacity constraints that we were seeing on the wires and cable side? And how much additional capacity is actually coming on st ream? Would it be largely for underground cables or it's a mix of underground cables and domestic wires.
And sir, were there any capacity constraints that either we or industry were seeing on the industrial cable side?
JSW Steel Limited
Hi, good evening sir. Sir my first question is on the reduction in prospect pipeline especially on the Hydrocarbon side. Now given that we are having a 10% reduction in overall prospect pipeline and we require almost like a 10%, 12% kind of a growth in order inflows to meet the guidance, where exactly are things changing? Are we anticip ating a much better strike rate in the domestic business which it appe ars had fallen a bit last year o r is it that we are seeing competition being a little lesser on the domestic side this time?
Sure. Sir, the second thing, you've spoken about labor availability issues and the potential of that to be slowing down execution. Where exactly are we seeing challenges and have they worsened over the last year or so?