Thank you very much. We will now begin the questio n-and-answer session. First question is from the line of Renu Baid Pugalia from IIFL Securities. Please proceed.

My first question is if you look on the execution side, are there any headwinds in the domestic market in terms of stepping up the execution run ra te or it is more to go in terms of the entire supply chain and the project timelines?

Can you share some color in terms of the broad reve nue mix for the current quarter in terms of products, projects, automation solutions because th at is clearly reflected in the gross margin profile that is reported this quarter?

So, we have about 12% of the revenue coming from t he services and software business put together, Rest, 88% between the product and project business.

Secondly, if we see a pretty impressive improvemen t in the working capital and reduction of debt on books, to what extent we think this improve ment is sustainable and is it also a function of the set up an order that we see for the cycle of advances and the entire working capital cycle and cash conversion cycle has seen a pickup in terms of improvement on books?

Yes, so it is a factor of all the improvement acti ons that we have taken meaning, advances, yes, if we look at the financial statements around in the INR 1.6 billion cash that we have generated in the first half, around INR 0.5 billion or about I NR 50 crores is coming from the down payments that we have received on the new order. The rest equipment is mostly from the actions across the board, be it on account of realization o f past dues or trade receivables, reduction in the inventory through to be lean initiatives, and also making sure as you have been talking about in our conference call for last many quarters, we t alked about selectivity of the order which means secured payment terms, the payment terms with lesser credit period and so on. So, that means the profit which we realize is also getting c onverted into cash. So, cash remission is a combination of profit converted to cash plus working capital improvement across the board.

And lastly, Sandeep, if you can also share some in puts as in we have been talking pretty positive in terms of the domestic order pipeline improving o n a strong note, the GEC projects coming through on exports also picking up, so any comments in terms of how the order pipeline is looking for the next 6 to 12 months? And do we perceive any slowdown in the early part of the next 6 years because of the election?

I think whatever run rate we are maintaining, we a re looking at a quite healthy growth or sustainable order intake pipeline, at least from next 6 to 12 months, Renu. That will be, because GEC projects and all, of course, now they have start ed coming up at a regular interval, and the finalization is also happening, but with the visibility, at least, we are pretty confident of next 12 months, yes, we will be able to maintain the run rate.

Coming back to your first question on the split of revenue between project and product, so around 60% to 65% of the revenue are from the produ ct business, 20% to 25% of the revenue from the project business, and the rest revenue is from the services and software business.

My first question is around the operating margins per se, so while there is a significant operating leverage that seems to be kicking in and helping our net profitability quarter-on-quarter, what is the sustainable margin in terms of EBITDA margin we are looking at or what is our healthy EBITDA margin per se?

So, the current gross profit of around 36%-37% and 10% EBITDA is already healthy if we compare with the past many years of performance. Ho wever, having said that, management always endeavored to perform better, and this can h ave multiple ways of improvement, first, targeting better profitability in the orders, then many execution initiatives that Sandeep talked about including lean productivity, efficiency, and so on and last couple of actions being, first of all, the control over fixed expenses of the structu re cost and the working capital improvement which then helps to save the financial cost. So, we will continue to work on the improvement as the management on these numbers.

So, we see going this into double digits, we expec t more improvement on this front in quarters to come, you are saying?

No, I am not giving a forward-looking guidance. Wh at I am saying is that our endeavor is to always improve, but the quarter-on-quarter number w ill always depend on the mix of project, production and services. We will continue to work on this direction.

And my second question is around the order book, w hile our order book seems to be very healthy, around Rs. 4,000-Rs. 4,500 crores of orders pending, any particular number that we are looking at in executing over the period of the next 12 months?

So, basically, what we do is that we keep on asses sing the customer requirement in terms of what are the delivery needs and also that what kind of capacities we have, do we have the slot for that and accordingly we take the order. So, if you reall y look at our run rate, I think we are looking at an order intake of about close to Rs. 1,000 crore s, so eventually the run rate which needs to go in few quarters when it gets stabilized, again, depending on the product and project mix and all, will be somewhere near that number. That is the expectation.

Thank you. We have our next follow-up question fro m the line of Mr. Renu Baid Pugaliya from IIFL Securities. Please proceed.

Sir, if you look at this quarterly run rate of Rs. 1,000 crores of inflows being sustainable and October again, we have a large order of Rs. 500 crores announced in addition to the base orders as we continue, do you think sometimes going ahead in the next fiscal year, we may start feeling a pinch on the capacity side and are we there in th e capacity expansion plan, so what are the current utilization levels and you think in the nex t 12-18 months, if the new order flow momentum sustains, will that trigger some capacity debottlenecking in certain product lines, etc?

So, Renu, we keep on analyzing that in which segmen t, the orders are coming and then how these capacities can be debottlenecked and of cours e, one of the main principle of lean is also that how to debottleneck and how to improve the pro ductivity. So, it is basically kind of a mindset change also and under the global directive, we keep on working on that. Depending upon the situation, yes, we will be looking into the timeframe and also, we are also trying to see that which capacities are, like which area in the m arket is something where you need to target more in terms of improving the margins and improving the margin profile.

So, for instance, suppose the transformer segment of the market, the domestic market is already tight in terms of capacities and we were also expecting larger export orders on this side, do you think at least within the product business line, tr ansformer segment could see some capacity enhancement?

So, it will be very difficult to tell now, but yes , in case if we face such a constraint, definitely that is something we look forward to.

And secondly, can you also share certain updates i n terms of progress on the HVDC project, Badla has also seen price-based submission happening there, so where are we in terms of project timelines? Do we expect any delays? And also, on the export opportunity on the HVDC products, how are those developments shaping up?

So, for Badla as you know, the bidding has already started for the developers. Of course, Badla being such a large project requires a huge amount of system studies and also creating a complete bid of an HVDC takes time. So, we are working with t wo developers who are there and also regarding the export market, yes, definitely we keep on analyzing with our global teams because for HVDC and all those applications, it is ultimatel y the acceptance of the international customers of our local factories is also a critical point. So, based on that, we will keep on analyzing and wherever it is beneficial for the com pany, those orders will be targeted and will be taken.

Thank you. Next question is from the line of Janak Lotwala, an Individual Investor. Please proceed.

I have a follow up question around the order book business environment that you are operating in, again, while we have a very strong and healthy order book and there are a lot of tailwinds in the business, if you were to describe what is it, certain 3-4 top factors that can give key sources of risk to the execution over the next 12-24 months , what can be the 3-4 areas of uncertainties or risks that we have to keep in mind as investors?

So, I think today one of the biggest risks what we see in today's environment based on our experience of last 1-2 years is geopolitical factors, for example, the Russia-Ukraine war, it kind of disrupted the whole supply chain in a very big w ay. So, that is one area where we keep on constantly monitoring because that is something whi ch can impact to a great extent the whole supply chain situation. So, that is one and second, also for many of our product on subcomponent side, we are also dependent on single source suppli ers. So, that also the company is working to develop alternate sources and try to see that we de-risk ourselves from any such situation where that supplier is not able to perform. And apart fro m that, also the way the renewable market is now growing and along with that, the private transm ission is growing. So, like in the power generation segment, there was a time when a lot of people entered and then there was a challenge on the financial side. So, we try and as Sushil said that we try to make a proper assessment and ensure that with companies which we are entering in to and doing business are very robust and under a set of conditions which clearly minimizes the risk for us.

So, similar to what you mentioned about sourcing f rom single suppliers, do we have any customer concentration risk as well, what are the r evenues that our top 5-10 customers are contributing to and are there any measures on that front? What is our customer profile look like in terms of revenue concentration?

So, if I tell you that we don't have this type of a situation for us because as I think you would have seen the presentation also, we have kind of very diversified portfolio of customers. So, like we are doing with generating companies, we are doing with EPC companies, we are doing with private transmission companies, we are doing part w ith state utilities and industry also, for example, Hindalco and Reliance of the world. So, it is that we have a very diversified portfolio in terms of customers. So, today we don't have any customer where we are dependent like on one customer we are dependent for 25%-30% of our revenue. We don't have any such customer in our portfolio.

Thank you. Next question is from the line of Abhij eet from YES Securities. Please proceed.

So, my question is on the supply demand balance fr om a slightly longer-term perspective, we have seen demand spurt in the last 2-3 quarters, we have seen increased tendering activity, increased tendering pipeline pertaining to GEC, so the demand is picking up and in line with that, a lot of peers have put up capacities in transformers, switchgear, etc., so going forward, let us say, from a perspective of 2-3 years, so when do you see these capacities catching up with the demand and therefore having an impact on pricing an d margins? So, right now we are in the cycle of expanding margins, I am sure the bidding margins are also pretty attractive in this cycle, but sir, since a lot of players are expanding their capacities, how can we look at this scenario going forward in the next 2-3 years?

So, I think going forward, when we look at 2-3 yea rs, of course, we cannot create like, suddenly we cannot decide, for example, when we look at GEC corridors, etc., at one point of time, GEC corridors were taking more than one year for decisi on making. So, first we have to also see the sustainability of GEC corridor at a regular interval of ordering that. That is one thing what we have to have that confidence. That is the first asp ect. Second also, when we try to build up a capacity, it is not something which can be built in like 6-8 months’ time. So, we also have to see the kind of new capacities building up, how much ti me it takes and also it is not only the capacities which have to be built up, but also you have to see that at the backend the supply chain, how you are comfortable with that supply chain in that specific product to support you in terms of those deliveries. That is the second factor. Third and the most important thing, Abhijeet is that we keep on analyzing this thing and then th ere are a lot of factors how you debottleneck your capacities and try to increase on an increment al basis. So, that is a constant endeavor we keep on doing and in this scenario also, at least that is what will be the focus of the company.

Sir, if you can point out what is the current capa city utilization for us in the higher kV category like 765 kV? Is it possible to quantify that?

It is very difficult to quantify Abhijeet, but I w ould only put it as like pretty high.

You are saying pretty high.

Yes.

And secondly, sir, on the order book from the stat e side, so last 4-5 quarters, sequentially, I have seen the state order book decline quarter-on-quarte r, now it is somewhere around Rs. 400 odd crores, so is this something a conscious decision that we are going slow on state orders because of certain issues that we are facing?

Yes, Abhijeet, we had taken a conscious decision t o move from state and to concentrate more on private sector because of the flexibility it off ers and so state is more like L1 bidding reverse auction and other things, so therefore the conscious decision was made to shift more from state towards more from private and I think the improveme nt in results what we have seen is one of the actions that was taken and resulted into this results.

Thank you. Next question is from the line of Harsh it Kapadia from Elara Capital. Please proceed.

Sir, just a clarification on HVDC, so what CA has a pproved is of Rs. 13,200 crores as a total project size for the Badla part, now how much would be the HVDC portion within that and what would be the EPC portion, and will it be as given to a single company or could there be a multiple companies who would be winning it and if you can hi ghlight how could be the L1 or L2 ratio would be?

So, Harshit, first of all, we are not aware how CE A has reached that budget, so probably that is for them to answer. But CEA has taken out this tender on TBCB route. So, on TBCB route, when it will be awarded, it will be awarded to the devel oper and the scope of developer will be from acquiring land to building and commissioning the pr oject and running the project which its showing for 35 years including building the transmi ssion line. So, this depends upon which developer wins because that developer, for example, a developer X to developer Y, may have a different model of procurement like somebody can sa y that if the civil work they will do, somebody might split line into four packages, someb ody might split line into two parts, somebody can give the HVDC terminal without construc tion, somebody can give HVDC terminal with construction, so this is the kind of an individual strategy of each and every developer. So, it will be very difficult for us to comment on that.

Any understanding on what is the cost of let us sa y an HVDC line, HVDC terminal or HVDC substation if it is coming up, any rough understanding would be very helpful, sir?

No it will be too premature because we have just s tarted engaging and some at a very preliminary stage so for such a large project, it is very difficult to make assessment on the price as of now.

And do you expect that every year, there would be one HVDC project which would be coming out for tendering or do you think there will be a span over the next 7 to 8 years? It won't be over every year.

I think for the next 3 to 4 years, yes, definitely there will be one every year.

And given that Europe is also looking in HVDC pipel ine, do you think the aggression among the companies like GE as well as its competitor wou ld be not so aggressive, would be comparatively much softer or what is your perception over there, sir because the pipeline is better in India as well as abroad and players are very handful?

This is too early to discuss the bidding strategy and on a public forum, these things cannot be disclosed, and it will be very difficult to comment on what is going to be the competitive strategy as well.

And sir, secondly on your strategy on, going more towards private, so is there a number that you have in mind that we want certain amount of busines s coming from private for the transformer side, right now what is the ratio and what is your target, sir?

I will not use the word private, but I will say th at what we are today looking forward to is more, for example, customers where you have assured payme nt, where you have timely payment coming, where the processes are very well aligned. So, if I look at, for example, Power Grid Corporation, they are like one of the best paymaster s with a very defined and a transparent process. So, I think it is not between a private or a public, it is basically more that where the process and payments do come on much faster timelines.

Thank you. Next question is from the line of Shyam Maheshwari from Aditya Birla Mutual Fund. Please proceed.

If there will be any update, it will be known thro ugh, I think we will be communicating. So, as of today, there is no update.

We have taken one approval for large order and tha t is still under negotiation. It has not yet finalized.

Thank you. Next question is from the line of Tanay Rasal from Philip Capital. Please go ahead.

I just got two questions. The first question, like in the current scenario, are you seeing any competition from the Chinese players? Are there any products been dumped from the Chinese players as such?

No, we are not.

So, what will be your market share presently for t he Chinese players in transformers like products?

I think it would be very less because now at least in TBCB and other utility segment, Chinese are not allowed to participate. So, it will be very minuscule.

Sir, and given the integration of the renewable wi ll be in the large scale now, so how do you see the STATCOM opportunity? How big is that opportunity?

So, STATCOM we see as a big opportunity because ren ewable integration definitely is going to require a lot of STATCOM projects, particularly where the large renewable projects are getting connected. Simply seeing one or two projects which have got finalized, I think going forward, maybe after kind of 6 months, 8 months’ timeframe, we will see a much larger volume of STATCOMs getting finalized.

And sir, like if you look at the orders you have f rom the PGCIL, so what are the areas that you are getting the orders from the PGCIL and how big that package can be from PGCIL?

So, we are getting orders from PGCIL, like for exa mple, we have got orders for transformers, we have got reactors for projects, we have got one for building a 765 kV GIS substation, one for building a 132 kV GIS substation. So, it is basically multiple products and then from the regions we keep on getting orders for products as well. So, it is multiple, and it depends upon what kind of requirements, it can be from Rs. 1 crore to Rs. 200 crores, anything.

Sir, my question is around the order book particip ation, when we decide to bid for a certain business or participate for a certain order or a business, first what is our hit rate and second what is our right to win that order? What differentiates our offering for us from our competition?

So, I think generally it is very difficult to defi ne a hit rate primarily because we have multiple lines of businesses and for example, we might sell a relay also, we might sell control relay, panel also, SCADA also, breaker also, project also, transformer also, so it is very difficult. That is one thing because different products, different systems have different competition, different number of players. So, it is very difficult to capture the hit rate. Second thing again, as I said that it is very difficult to also tell that what is our entitlement to win that order, but like for example, when you go to few utilities, there some utilities will have L1 pricing, some utilities will have kind of a reverse auction, some EPC customers, it is on nego tiated basis, at some places it is a pre-bid agreement also like with an EPC player we will say that okay this is a pre-bid agreement, for this scope, if you win, I will be with you. So, thi s is basically a different market strategy depending upon different market, different customer , different product, so it is a very dynamic evolving situation. So, it is very difficult to explain it like this is the one that which defines that with this bullet we will be able to achieve all our objectives.

Thank you. As there are no further questions from the participants, I now hand the conference over to Ms. Tanvi Gupta for closing comments.

Thank you all for joining us today for the GE T&D India Limited Earning Call. We hope the insights provided by our speakers have been informative and valuable to you. We value the trust and support of our investors and analysts and ensure to remain committed to maintain transparent communication and fostering stronger relationships. If you have any further questions or require additional information, please do not hesitate to reach out to me or our Communications Leader Anshul Madaan at the mail ids available at our company website. Once again, thank you for your participation in today's call. I wish you all and your family the Happy Diwali festivities. We look forward to your coordinated support as we embark on our exciting journey ahead. Thank you.

Thank you very much. On behalf of GE T&D India Lim ited, that concludes this conference. Thank you all for joining us and you may now disconnect your lines.