Thank you very much. We will now begin the question -and-answer session. First question is from the line of Mohit Kumar from ICICI Securities.

Congratulations on a very, very good quarter. My first question is on the gross margin. The gross margin improvement has been very, very sharp in the last Q-o-Q or if you look at Y-o-Y, I think is the -- it was 40% this quarter compared to last year same quarter, 32%. How much of this is sustainable? And do you think some moderation in th e margins as you go forward? That's the first question.

Thanks, Mohit. So in our business, because we are a long-cycle business, and the gross margin also depends on a combination of various factors, including the mix of revenue between projects and products and export and domestic. So generally, we kind of evaluate the gross margin performance more on a yearly basis. And if we compa re our financial performance, the last financial year, we had achieved a gross margin numb er 34.4%. This year, the first quarter is a very good start, wherein, we have achieved 40.3% of gross margin. And this performance gives us better confidence that our endeavour, which is always to take the margin to a higher level is working in the right di rection, and we should be able to achieve a better margin compared to last year. And in terms o f the guidance, as is practice, we don't give any guidance. But yes, as a management team, we always work to improve the gross margin or the overall profitability.

Understood , My question is on the order inflow. Order inflow for the quarter was slightly on the lower side, given the fact that we have seen that l ast year, a number of projects were bid out. And so my question is are you seeing a larger inqui ry and do you think that this passes into higher order inflow as you go forward?

So Mohit, Sandeep here. So yes, I think there was s ome impact of decision-making because of elections as well. But I think if you will see that we maintain the order inflow number of INR10.3 billion, which was like a 2% growth. But also, if you see that in July, we have already declared an order to the stock market of about INR13 billion . And if you also look at our order backlog, so we have a very impressive growth in the order ba cklog of 59% we are presently at about INR63 billion as compared to, it was INR39 billion in the last year, the same quarter. So it's an impressive, I think, growth there. And yes, definitely, we are looking at the pipeline and just the renewal of the TBCB pipeline, we look at it as a more sustainable and a growth pipeline.

My last question, sir. How do you -- are you partic ipating in the upcoming HVDC tender for Bhadla-Fatehpur and the STATCOMs?

So Mohit, I think not the right forum to discuss th at where which bid we are participating on that, but I can tell you that, yes, globally, we are one of the top 3 players of HVDC and also for STATCOM. So yes, it will be our endeavour to take so me market on HVDC and STATCOM both.

Next question is from the line of Umesh Raut from Nomura India.

Congratulations for the excellent set of numbers. My first question is again on the gross margin. So if I look at your trend on the gross margin or y our commentary since last few quarters, sometime back you were saying that about 30% to 35% is kind of more of a sustainable gross margin that one can look at. But now we have already touched closer to 40%. So how much of this gross margin expansion you can attribute to, s ay, healthy pricing power to say, internal efficiency where you have localized incremental pro duct offering from domestic market. And thirdly, on the account of, say, even the product m ix, especially from export execution and domestic execution pointers. So if you can highligh t certain things on gross margin side in a more of granular way.

Yes. Thanks, Umesh. So as I mentioned that, yes, we did well in terms of gross margin in the quarter 1. And this gives us the confidence that we should be doing better versus the last financial year, which was 34%. The direction of 30%,-32% that you are talking was about a couple of years ago. And at the same time, we continue to als o highlight that as management, our endeavour is to work towards a higher side or improving that margin further. And you rightly mentioned few factors which are leading to the gross margin improvement are, the mix of the project, contribution of higher export sales, improvement in pricing. Plus also, in the last 2 to 3 years, we have highlighted multiple things about our internal improvement actions, especially the lean and the productivity, which has led to the gross margin improvement. And we also talked about selectivity of the projec ts, which are not only profitable in terms of the reported margin but also leading to the cash ge neration or cash collection for the company. So as you see the gross margin were also getting converted into the higher profit before tax and also the cash performance where we have made -- thi s quarter was 7th consecutive quarter of positive cash generation for us, and we have now ac cumulated INR4.4 billion of cash surplus. So yes, the 3-4 factors that you mentioned, a coupl e of further factors that I highlighted, and there are many more actions that we are taking to make sure that we improve margin versus the margin that we anticipate at the order booking stage.

Got it, sir. Sir, my second question is on the expo rt ordering, especially from group entities. So I think if I look at last 12 months, those have been really fabulous for us in terms of getting larger and sizable contracts from group entities. If you c an throw some highlight on, say, next 12 months in terms of outlook from incremental ordering from group entities and also beyond group entities in terms of export ordering?

Hi Umesh… So for example, even the outside entities, they tak e the support of Indian manufacturing and then they bid to the end customer. So as of today, it is difficult to predict that what kind of orders they would be winning and what kind of orders will be coming. But yes, definitely, the Indian manufacturing setup is a very strong support in many geographies to go and win the orders, not only from group entities, but also GE T&D is also directly bidding and taking export orders as well. So it's very difficult to give a number today that this is what we are going to achieve in the next 3 quarters or 4 quarters in terms of export. But definitely, as Sushil said that, yes, the endeavour would be that to grow on export orders because we have a slightly better margin as compared to the domestic ones.

Got it, sir. Sir, my last question is pertaining to capacity utilization. And if I look at current trends in the industry, I think there is really a good visibility of sustaining this demand for maybe multiple years, especially from domestic as well as export markets. So just wanted to know what are your plans in term s of capacity expansion? And what is exactly current utilization rate as well for especially maj or products like, say, transformer and on the HVDC side as well, STATCOM and other things?

So Umesh, here, I think we have answered this quest ion in the past as well. So capacity utilization also depends upon multiple factors that what kind of ratings we have got in combination for the orders and in transformers and reactors and a lot of factors which are there. I would say that, okay, whenever we are seeing tha t there are any bottleneck in terms of taking orders for capacity utilization, of course, we try to identify the bottlenecks in the whole process. And then we are trying to see that removing this bottleneck how can the capacity be increased. And for many of the products, yes, I would say tha t we are having a much better capacity utilization today, especially when I look at transf ormers and a few other products. But in other products, we need to catch up in terms capability utilization as well.

Okay. Sir, is it fair to assume that at a big capacity utilization, we can touch closer to about, say, INR60 billion in terms of turnover?

So that would be kind of a forward-looking statement, and we would refrain from...

See, I think, Umesh, as an analyst, you can see the historical trend of how our backlog has got converted into revenue, and you can extrapolate the numbers at your own. And the revenue in the future here is a factor of multiple things, which is not just a backlog, but what we can achieve in the future, including HVDC and STATCOM that we jus t talked about because that can give a boost to the revenue depending on if you win those contracts on a timely basis. But I'd request you to take the past trend to extrapolate.

Next question is from the line of Parikshit Kandpal from HDFC Securities.

Congratulations on a great quarter, fantastic number s. Always keep asking you when will you reach the INR1,000 crores quarterly tender, I think you're almost at that stage and with the great margins. So my first question is on -- you said that now in July, you've announced INR800 crores of orders from group companies. So if I remember co rrectly, last year, you had taken RPT approvals to the extent of INR3,000 crores of limits. So do you think that this year we'll be able to fill that? Is there any pending backlog from the last year, which would get finalized over and above this INR8 billion. So how do we see this number of INR3,000 crores in this year?

So Parikshit, I think the numbers that you're refer ring to are quite different than what we have requested to the shareholders for approval. If I re collect well, we took an approval of about INR1,000 crores for orders from one of the group co mpanies. I think it was UK Grid Solutions for transformer business. And that order was already booked in the last financial year. I think it was booked in the month of December 2023. Subsequen tly, in the month of February, we have taken another related party approval for, I think a gain about INR1,000 crores value for another group entity for the product -- other product busin ess. And that order was booked in the month of Julyfor about INR800 crores. So INR800 crores in December and INR800 crores roughly in July this year w.r.t related party orders. I think beyond that, whatever RPT approval we had s ought, they were more related to the cash pool arrangement. They are more for the banking and the financial fund management rather than the order booking. And now we have an upcoming AGM, , whatever anticipated orders for financial year '24, '25 that we foresee will be inc luded int the notice to the shareholders for the upcoming AGM.

But as a trend, do you think what you did last year? I mean, similar kind of trends could be maintained from group entities.

See, last year, in terms of export order booking, w e did approximately -- let me get the value. We did about 30%-32% of orders were from the export side? And this time, if you see, we have already done INR800 crores of order in the month of July. This would represent almost, if I'm not mistaken, maybe 15% of last year order bookings. So yes, we have got a significant export order in this year as well. As Sandeep explained, export orders, we always refer to sales export order becau se they are slightly better margin than the domestic margin. But there is no trend as such, meaning we cannot say that, yes, whatever orders we are getting will continue to get because it depends on a lot of factors. It depends on whether the group companies are winning the orders, whether we have the technical capabilities, and we are factoring a qualified exposure. So our endeavour is always there. The trend as far as is better, we continue to work in this area.

So Parikshit, just one thing here. So every quarter , we have kind of a regular flow of orders of, like, for example, automation and High Voltage prod ucts. And when there is a one-off, which comes like, for example, last year, it was transformer grid solution. Here this time, it is like one- off, which has come from the product, INR800 crores what we have reported. So I think the sustainability of the export order quarter-on-quart er, we don't see a challenge. One-off, for example, we have got this INR800 crores. We will co ntinue to work during the year for more such opportunities.

Okay. Got it. Clear. That explains. Sir, second ques tion is on HVDC side. So I mean the -- so the Power Grid keeps talking about 2 technologies, LCC and VSC. So do you have presence? I mean can you do both these technologies in India an d given some of these projects may get designed on these 2 technologies. So for you, are you pressing in both these technologies? And will you bid for this HVDC joint venture with your parent company?

So Parikshit, I'll just answer this that yes, defin itely because Champa-Kurukshetra, we have already done on LCC technologies. And if you look at our global reference, for example, today in Germany, U.K., multiple places, GE has taken ord ers of VSC projects of evacuation of offshore wind and things like that. So we have the technology both for LCC and for VSC. Bidding for a specific project or not, that's a bidding strategy what decision we take. But yes, we have the capacity and capability both to deliver LCC and VSC.

Okay. And just the last question is around the prod uct side. So do you see -- given the demand in the market, do you think that we will slowly sta rt vacating the lower end of the product for the transformers and prioritize or premiumize our p ortfolio more towards better margin VIGS kind of product. So what's your thought process there on the factory line side?

So I think Sushil, during his initial remarks, has well said, that we are very much focused on selectivity as well. We would like to operate in do mains where we are really doing a value-add for the customer as well as we are doing a value-ad d to the shareholders as well in terms of earning margins. We take a call based on that. But t here were -- for example, at the lower end, the market is totally cluttered and there are multiple players. And maybe we might decide not to operate in that segment as well.

It also depends upon which factories we are talking about.

Next question is from the line of Subhadip Mitra from Nuvama. Subhadip Mitra: Congratulations for an excellent set of results. My first question is, if you look at your current order book and typically, I understand that gross margins would be a function of the pricing that you have bid for the tenders, which would already b e there in your order book as well as lean raw material sourcing, etcetera, which we've already highlighted. So at least based on the pricing that's already there booked in the order book, could you give us a range of what the current order book looks like in terms of margins?

So we don't typically share that kind of data. But as I mentioned in my initial response to the earlier questions, last financial year, we did 34.4% of gross margin. And as a management, our endeavour is to improve it further. We have done th at in quarter 1, and we hope that we can continue this journey and make an improvement on the gross margin on an overall financial year basis versus the last financial year. Subhadip Mitra: Okay. Secondly, in terms of the size of the market available out there, right? So it's split between, let's say, large HVDC orders in India, and exports a nd then followed by the non-HVDC piece, which is also large. And I think thirdly, the renew able related, let's say, non-ISPS related order inflow that's coming. So would it be possible for you to paint us a picture in terms of what kind of TAM you're looking at across these three or four different buckets?

So, Subhadip, I think the focus is, of course, TBCB as well as I&I, data centers, so these are the markets that we are including the digitization, load dispatch centers. I think these are the markets that we are targeting. And of course, it is difficult to put a TAM to tha t because in some parts, we are participating, in some parts directly and in other parts with some de velopers, we are not there. But I would say that our focus strongly remains into these domains only like the export, the TBCB market, the industry market, the data center market. So these a re the major segments and of course, what I said with load dispatch centers and all. And of course, when we look at our product orderin g, definitely, it doesn't matter to us whether it is a state utility or wherever the product is required and if the orders are coming through EPC customers, then the end client, it doesn't matter too much to us. I think this is what we are targeting and definite ly selectivity is playing an important role because we are not running after anything and everything. That is what we have made very clear and we want to continue this journey.

Next question is from the line of Mahesh Bendre from LIC Mutual Fund.

Sir, this quarter, I mean, you answered this questi on many time, but still this quarterly -- this operating performance has been quite strong. So we have reported around 19% EBITDA margin. Just wondering, is there any one-off in this in ter ms of any foreign exchange gain or I mean anything that is not regularly raised from the -- in the business?

Thanks for the question. There is nothing significant to be highlighted and it's a very operational regular profit that we are seeing in this quarter. I would like to highlight one more thing because earlier questions are more on the gross margin side . I think one important thing here to be highlighted because your question is more related t o EBITDA, is our expenses other than the gross margin, meaning the employee benefit expenses and other expenses; if you look at the trend, they have not increased significantly becaus e we have been able to make a very tight control over those expenses. So there is some increase in expenses related to th e revenues but not as significant. As a result, while the gross margin improvement is 5 to 6 points, but the EBITDA improvement because of the operating leverage impact has gone up by 10 per centage points. And that is also one area where we want to continue to focus as a management to make sure that whatever improvements we make in the gross margin directly flow to the profit before and profit after tax.

Sir, capital expenditure planned for next 2 years?

So we have -- we don't typically share this in the investor call because whenever there will be a large capital expenditure plan, we'll be making dis closure to all the shareholders through the stock exchange. At the same time, our regular reple nishment expenditure in the range of, say, INR40 crores to INR50 crores, which is equal to dep reciation. And in addition, there will be some capex, which Sandeep highlighted in terms of t he debottleneck of capacity, which will rightly help us to make sure that we are able to produce more from the existing plants.

Sure. And sir, last question from my end. I mean it is expected over the next 5 to 6 years, around INR3 lakh crores will be spent on transmission in I ndia. So given the renewables, number of renewables and number of generation capacity that is coming up, do you think this number looks very low in terms of capex on transmission side?

I think we have to also understand that INR3 lakh c rores includes the transmission lines and everything included in that, including the HVDCs. But this is also dependent upon what is the speed of generation coming in, the capacity is getting added and all those factors as well. So I think the number looks to be reasonable becau se there are other forms of generation also which the government will be pushing in terms of offshore wind and other forms as well. I think this looks to be the minimum number, which is there , but yes, definitely, there can be an improvement for that as well.

Next question is from the line of Rahul Modi from Nippon India Asset Management.

Sir, the line got disconnected. Meanwhile, we'll move to the next question from the line of Amit Anwani from PL Capital.

Congratulations for the good set of numbers. First q uestion, I would like to understand the breakup of product versus projects this quarter and the base quarter? And any sort of -- you did highlight a couple of things in terms of focus on operational efficiency and cost control. Wanted to understand any internal targets because of this savings, which can add to EBITDA margin?

So I think the answer to your first question is rou ghly 20% to 25% of the revenue comes from the project business and rest from the product business. I'm sorry, I missed your second question. I request you repeat that again, please.

Yes. So second thing, sir, you did highlighted that there's a lot of focus on operational efficiency within the firm and there's focus also on the tighter cost control. Just wanted to understand, any target because of the operational efficiency, which we are aiming, which can add a percentage to EBITDA only because of efficiencies.

Yes. So maybe just to reword what I said earlier, w here I said we are maintaining control over costs. It didn't mean that we are targeting to redu ce the cost. That means that even despite the revenue increase (the significant revenue increase of 34% that we have seen in the quarter), and we hope that our revenues will grow, we would like to execute the revenue with the existing structure. So that means, let's say, if our revenue is growin g by 34% and the other expense and employee benefit is not growing to the extent of revenue, we will see a direct benefit or improvement in the profit before tax.

Sure. Secondly, sir, on the order prospects. So I recollect a few months back we did highlighted some INR25,000 crores prospect. So just wanted to u nderstand, very recently, PGCIL also announced a higher capex and capitalization for FY '25, '26 and the longer-term plan. Does that any ways improve our prospect? And if you could throw some line -- light on the order prospects, again, if possible.

Amit, yes, Power Grid is one of the largest transmi ssion utility in the country and any increase in the capex by Power Grid is a direct reflection o f the strength of the market and also because it's one of the largest customer for us as well. I think any increase in the capex that Power Grid has announced, is going to directly benefit us in terms of order intake, definitely. But we have to also see that as I said that the amount of generation, which is going to come in and the new projects of TBCB which are coming in. The impact of that in terms of today, declaring that this is going to the value of orders which we are going to get is difficult for the year because we have just completed the first quarter. But I think we remain optimistic about the year in terms of order intake much stronger.

Sure. Lastly, sir, again, on the product versus pro ject, you highlighted 75-25. Can we assume that this will be the trend for the next 3 quarters also?

As I said before we don't give forward-looking guid ance and it depends on the execution time line of the project, which can be very different qu arter-to-quarter. But generally, yes, this has been the mix of order booking and if the new order booking remains in the same ratio, then this trend on revenue will remain same.

Next question is from the line of Amit Mahawar from UBS.

Sandeep, I just want to understand, if you look at last 15-20 years of transmission equipment market, we had a peak of roughly around INR25,000 c rores, INR28,000 crores back like 12 years ago. And GE T&D had a peak margin, which is actually what we reported just now, range. The market has very much changed, right, since then. So do you think take a 3-year, 4-year view, our scale will be very different in 4 years' time? Or you think -- because the market might be INR30,000 crores, INR40,000 crores per annum best case next year. So how do you see next 3 years for GE T&D capacity framework? Because most players are very, very judicious in expanding capacity. And this is considering your own mix is 1/3 skewed towards exports, which is ever growing demand from a parent company. So next 3 years, how should we think about GE in terms of capacity to ma nufacture and scale up and commensurate to that, how is the India opportunity looking like to you?

Thanks, Amit, and I think you are right. For the ne xt 3, 4 years as far as my thinking is, that looking into the potential of renewable and not only renewable, but I think the thermal capacity expansion which is coming. I think there is going to be a sustained demand in terms of Conventional Transmission and with HVDCs coming in and also the interconnection between the various countries, which has been talked about. I think there is going to be a sustai ned demand, at least the next 3-4 years in the country. No doubt on that. And because of the energy transition story, we hav e grown globally, whether you look at Europe, whether you look at Australia, whether you look at the U.S., I think the export requirements will keep on cropping up of large projects as well, say, whether it is going to be one opportunity, two opportunity within a year. But my feeling is that, y es, definitely, it's going to be there. And the utilization, as I said, in my prior answer as well. Everything is like we are not there in this asset utilization benchmark. We have for a few prospects, we have some spare capacities also available with us. And I think these things are goi ng to help us in the further growth which we are looking for that as well.

Fair. And second quick question is for GE even during the old times, the business mix has been skewed towards private, right, always. Even today, you have more than 60% of business or orders are from private sector. How should we look at this, say, 3, 4 years on the line? Because -- do you think this will change? And the reason I' m asking this is also because different businesses have different profitability metrics. An d so you think from a 3-year view, your mix will shift?

One thing is very clear that as a strategy, we are not so much inclined to go on the state side. For example, when it's customers like Power Grid, NTPC i s definitely a GO, because the way the contracting is done there and the execution is done is more or less matching the pace of the private players as well. If I look at next 2 to 3 years, definitely, we are going to be more driven by private, but for example, a large project which is coming from state can also change the numbers in terms of the dynamics. But looking into our conventional portfoli o yes, private will play a more important role than state.

Sure. Sir, I'm taking liberty to ask a last quick q uestion. Any specific maybe additional powers or flexibility you get from parent company to decid e your growth in India for the domestic market, export market? Anything that you want to cover.

No, we are fine. With the set of results, I think t he combination of between the parent and the subsidiary or our own Indian management, is very well demonstrated in our results.

Next question is from the line of Rahul Modi from Nippon India Asset Management.

Sorry, I got dropped out due to some technical issu e. So I just have 2 quick questions. Most of that -- most of the questions have been answered. One is if you could just make us understand a little better because globally, the market is also expanding in a very fast pace. We've seen demand growing significantly. So when you are doing your -- making your strategy , how do you -- what is the thought internally between exports and group companies and Indian markets, that is one. And secondly, in terms of -- obviously, you mentio ned about margins being better there. So in terms of -- again, any thoughts on how the parent and the local entity is working in terms of the Indian entity being a supplier to the global entities. To what extent are we on a priority list versus the other entities globally?

Thanks, Rahul. And I think one thing I want to make very clear that, we are a very important part of our global strategy as well. Our acceptability, for example, in many of the geo graphies also depend upon the customer acceptability as well. In the next geography if we want to supply, but the customer wants to buy from a nearby factory and things like that, maybe i t is not possible. But in view of Energy Transition demand today, when I look at the whole w orld, we are supplying consistently to, Southeast Asia, Australia, South Asia, Africa, Latin America, and we have also started supplying in parts of Europe as well. I think when I look at the whole world, I think th ere are many geographies which we are covering from our Indian factories and this is slowly, slowl y depending upon the need of the business there and the customer acceptability is also going up in terms of Indian factory. Second thing, when we look at our strategy, your first question was that how do we balance between the India and our export strategy. For a fe w things, support, for example, the HVDC transformer support, which is there. But normally, our focus for transformer business is more in terms of domestic business. For project business, it is more in terms of the d omestic support for the Indian customers. And when I say domestic, it also means apart from India and including Nepal, Bhutan, Bangladesh, the neighbouring countries as well as Sri Lanka bec ause that we consider as part of our region as well. But when we look at our automation, when we look at our AIS product and GIS product, where our capacity utilization is also not like the high end. So there, we are comfortably able to support and where the turnaround time is also much faster. So there, we are able to support the export, and not only in terms of supporting group entities, but also taking direct orders from the end customers as well. It could be utilities based out of Australia or Latin America or Africa or also supporting the EPC customers built out of India who are operating in Africa or other geographies as well. We take a conscious call of supporting the Indian networks as well and also balancing between the export and the domestic strategy. I hope my answer made sense to you, Rahul.

Yes. This was very helpful. And just last question from my side. Again, I'm not getting into the numbers. But directionally, over the next 2 years, do you see that because of a large opportunity, both in India and globally, do you think that there will be a need for a major capex and just not debottlenecking, if at all? Maybe a little thought, but no number just asking from a directional point of view as your sense on this?

Rahul as and when it will be required, we will be taking that call.

Next question is from the line of Mayank Chaturvedi from HSBC Mutual Fund.

Taking tips from your comments in the last question . I just wanted a clarification on the export order inflow or order book. Can you give us a split between the third-party orders book and the group entity orders that you booked from the book entity? And within that, do you say that third- party order subject relatively better margin grows for you, given that it won't be restricted by transfer pricing mechanisms?

No, no. Mayank, your voice was not very clear, but whatever I could understand. One thing is what we said that the export margins are slightly better than the domestic one. But in the export, we have not differentiated in terms of margin, whether it comes from group entities or it comes from third party. If that answers your question.

All right. And any indicator mix there, how much would be the third-party orders and how much is group entities, just ballpark number there, in your order and flow mix?

No, we typically do not share that kind of split.

All right, sir, no issues. And just one other thing, just taking context on Power Grid's commentary that came in this week that they are going for bulk procurement in advance for the next 18, 20 months. So would you say that they have already boo ked their requirements with you for the next 18-20 months and that it has already flown into your order inflows?

I think that would be more for Power Grid to answer that whether whatever procurement they have done, is it for their next 18-24 months requir ement or they are still to do it. But whatever requirements were coming, we are regularly participating and whatever we are winning, we are declaring to the market.

Next question is from the line of Prathmesh Salunkhe from PL Capital.

Congratulations on a really good quarter. So I just wanted to understand some bit more color, some a bit more details about your automation busin ess, like what are the growth prospects? Is it -- where is it exactly going? And what could be the contribution of this business to the overall revenue or margins? Is it a high-margin business? Is it a low-margin business? Any color would be appreciated, yes.

Thanks, Prathmesh. One of the things which I can say is that when the overall market is growing, obviously, the automation business is an integral part of every substation. So everywhere where the demand is growing, the automation demand is also growing. And looking into, for example, I'm not sure whethe r you know but the regional load dispatch data centers have come up for an upgrade. And that' s what we have declared that the first the northern region upgrade order, it has been booked in July for close to about INR5 billion. We’ll not be able to comment on the individual business s trategy and margins. But definitely, automation business remains our key focus and is an integral part of our growth strategy as well.

Okay. Okay. That was very helpful. Another thing, s ir, coming to STATCOM, I think in last quarter, we did have some commentary that about 15 to 20 STATCOMs are available in the next 2 to 3 years, each costing about INR3 billion. So i s that still the case? Or are there any incremental order fee, not order, incremental opportunity in the markets we are seeing apart from the 15 to 20 range?

No, as of today, that remains our assessment of the market.

And are we actively participating in the 15 to 20?

Next question is from the line of Jonas Bhutta from Birla Mutual Fund.

Congratulations Sandeep and team on a phenomenal result. I'm just trying to sort of further dig deeper on the gross margin bit. It's been asked multiple times, but I'll just have another go at it. So if I derive any comfort -- on the gross margin, it's largely driven by the sales mix. And if I see we've had export sort of accounting more or les s for the same quantum of sales as it did around the same time last year, and in fact slightl y lower on a sequential basis. Is it fair to say then the entire gross margin expansion has largely come from a better pricing environment in the domestic side of the business?

Multiple factors. We do not attribute to only to one factor. The gross margin is a result of better pricing in the last -- better priced orders that we booked in the last few quarters, that's for sure one of the reasons. Beyond that, mix is a very important factor. When w e talk about mix, it's not just the mix between product business and the project business, but also within that business, which particular products, so for example, product busine ss, which products we are selling more. Within the project business, which kind of projects we are executing? Are they better than the previous projects that we're executing in the past and the challenge in terms of profitability or challenge in terms of execution time? And beyond that, one of the thing that I always hi ghlighted in the last couple of years that whenever we book an order at a particular margin, our endeavour is to improve the profitability through the execution improvement. Those execution improvements are more in terms of sourcing savings, in terms of mitigation of risk, as well as in terms of better improvement in the productivity at our factories and locations. So mul tiple reasons. And fortunately, all of the reasons are working in the right direction. And our endeavour is to work -- continue to work in this direction.

Understood. And from a product mix, if at all, I can ask, is the level of demand-supply mismatch that we see in transformers, also in AIS and GIS. S o if -- so other way put, is this quarter sales mix reflective of a greater transformer sales versus a switchgear sales?

I think it will be very difficult, I think, Jonas, to comment on that part. But yes, definitely, the transformer volume we can say are going up. Then we are looking at a 34% growth in the revenue mix, your transformers have also contributed to that.

Understood. And my last question was on the status of the HVDC projects. So other than the Fatehpur-Bhadla that we are aware of that was underway bidding, etcetera, could you give us an update on where are we in Khavda-Nagpur and Khavda- Olepad? Do you think that these are prospects that can be awarded by the end of financial year? Or these are prospects for FY '26?

Next question is from the line of Indrajit Chakravarty from Scrip Trading Corporation.

Now I have some 3 small questions. First is that in the budget, setting up of small modular nuclear reactors were spoken about. Can I know if th e company has an opportunity evolving there at? Second question is this INR6,200 crores o rder backlog which you have, what is the time line for execution of this order? And third qu estion is, are we having any evolving opportunities in the setting up of these data centers, which has been spoken about?

One, is that our company is basically concentrating or basically designed to address the opportunities of transmission segment. We are not t here into the SMR, which is the Small Modular Reactor on the nuclear side. But if, for example, SMR projects do come and there is an evacuation Substation associated with that, then we will have a play. But nothing on the SMR technology. Yes, GE T&D has no role to play directly. That is the first thing. Second thing in data centers, yes, again, today, d ata centers have a much higher power demand requirement. Like, for example, it could be a 300-m egawatt, 500-megawatt. And the power, which is required for these data centers, yes definitely it is going to be at 220 kV. But as the data center sizes because of AI and ML are growing, eventually, if it comes at 400 kV and all, so yes, definitely, we have a play in data centers as well. So last year, there were multiple orders. And this quarter, also, we have taken orders for products which are going into data centers. Some of them are very short cycle. For example, we look at automation or we look at AIS product, just normally from order to delivery kind of the time line, which is like about 6 to 12 months. But when we look at the project or transformers tim eline, then they are much higher. And also when we look at export larger projects, they can be more than that as well. So typically, when we look at the INR6,200 crores, I think this should be good enough, we should be in a position a little bit in 2 to 3 years, something like that, with the execution time line for these backlogs.

Next question is from the line of Jainam from Saltoro Investment.

Congratulations on a great set of numbers and all your efforts have paid off in terms of product mix and gross margins as we've talked about. What I want to understand is when things are going great, are there any particular risks that you are looking at and trying to manage that is probably in the top of your mind. So that would be my question number one. And my question number two is, is there any upper cap that you're looking at in terms of exports that beyond this number we don't wish to go given t he fact that people want to maintain relationships in the domestic market and cater to?

Thanks, Jainam. Your first question, which is regar ding risk. So obviously, in every business, there are risk and as a part of our objective of th e GE T&D leadership team, we continue to manage or mitigate the risk for the business. So no thing specific I'll highlight that I think a lot of the euphoria or the expectation around the power sector is about the energy transition. And this is, again, dependent upon government policy. Government policy could be on how we deal or implement the projects internally, how the fundi ng of those projects are done and also the cross-border relationships. So those are the factor s which are general market-related risk, not specific to our company, which can impact both ways. I mean, this can impact negatively as well as positively the future order booking for the company. And regarding your question about I think the capp ing, there is no capping that we have in mind. And I think while there is a lot of discussion about export to domestic, see our management, as Sandeep mentioned, our focus is very clear, whichever order gives us a better margin and a better cash conversion cycle, gives a better value-add for our customer and for our shareholders to go for that order. And at present, we are looking for small capex in terms of capacity expansion. As Sandeep mentioned, if the time comes that we need to know, we'll think about that at the future stage and make due disclosure to the stock exchanges.

It seems that we have dropped the connection from M r. Jainam. That was the last question for today. I'd now like to hand the conference over to Ms. Megha Gupta for the closing comments.

Thank you all for joining us today. I hope the insights provided by our speakers who have been informative and valuable to you. We value the trust and support of our investors, analysts and ensure to remain committed to maintaining transpare nt communications and fostering strong relationships. If you have any further questions or require additi onal information, please do not hesitate to reach out to me or our communications leader. Thank you.

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