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Ashoka Buildcon Limited Q4 FY24 Earnings Conference Call Summary
Conference Call Details • Date: May 23, 2024 • Submission to: BSE and NSE on May 28, 2024 • Key Participants: • Managing Director: Satish Parakh • CFO: Paresh Mehta • Moderator: Vikram Vilas Suryavanshi (PhillipCapital)
Industry Trends • 20% increase in highway construction in FY23-24, below target. • Government plans for road construction and infrastructure improvements. • Focus on high-speed corridors and road safety.
Project Developments • Sale of Unison Enviro Private Limited. • New contracts for highway projects. • Order book as of March 31, 2024: ₹11,697 crores. • Emphasis on sustainable EPC business across highways, railways, and power transmission.
Financial Performance • Q4 FY24: • Total income: INR 2,533 crores (22% YoY increase). • EBITDA: INR 219 crores (8.6% margin). • FY24: • Total income: INR 7,841 crores (21% increase). • EBITDA: INR 691 crores (8.8% margin). • Profit Before Tax (PBT): INR 358 crores. • Profit After Tax (PAT): INR 443 crores (includes exceptional gains).
Revenue Contributions • Road EPC: 60% • Power EPC: 25% • Railways: 10% • Consolidated total income: INR 10,005 crores for FY24 (24.6% EBITDA margin).
Future Guidance • FY25 order book target: INR 12,000 to 15,000 crores. • Expected EBITDA margins: 9.5% for FY25, 11%-11.5% for FY26. • Anticipated revenue growth: ~15% for FY24-25.
Strategic Shifts • Participation in MSRDC tenders for state government projects. • Ongoing negotiations for asset monetization of Jaora-Nayagaon and Chennai ORR projects. • Expected signing of SPAs for HAM projects by June.
Cost Management • Bitumen costs: 20% to 30% of total road construction costs. • Payments primarily in cash to refineries.
Capital Management • Expected reduction of working capital debt by 50% through project monetization. • Approval for fundraising to realign working capital without increasing overall debt.
Bid Pipeline and Execution • Expanded bid pipeline focused on road, bridge, power distribution, solar, buildings, and railways. • Total order value of ₹750 crores expected to be completed within the year. • Execution of a water treatment order in Mumbai with expected revenues of INR 400 crores for FY24-25.
Financial Position • Increase in cash and bank balance due to substantial client payments. • Non-current trade receivables increased due to outstanding amounts from clients, particularly related to Chennai ORR project.
Ashoka Buildcon Limited Q3 FY '24 Earnings Conference Call Summary
Conference Call Overview • Date: February 8, 2024 • Submission to: BSE and NSE on February 13, 2024 • Key Participants: Managing Director Satish Parakh, CFO Paresh Mehta
Key Highlights • Budgetary Increase: 2.7% increase in road transport and highways allocation. • Contract Awards: Over INR 1,400 Crore in significant contract awards. • Order Book: Balance order book of INR 13,167 Crore as of December 31, 2023. • Focus Areas: Sustainable growth in highways, railways, and power transmission.
Financial Performance • Q3 FY '24 Standalone Income: INR 2,162 Crore (36% increase YoY). • EBITDA: INR 205 Crore (9.5% margin). • Nine-Month Income: INR 5,309 Crore (20% increase). • Consolidated Results: • Q3 Income: INR 2,699 Crore (35% YoY growth). • Nine-Month Income: INR 6,867 Crore (19% increase). • Consolidated EBITDA: INR 1,737 Crore (25.3% margin).
Revenue and Growth Projections • Revenue Growth Target: 15-20% for the year. • EBITDA Margin Expectation: Improvement to 11-11.5%. • Bid Pipeline: Substantial INR 95,000 Crore, primarily in the road sector.
Asset Monetization and Financial Strategy • Projects in Progress: 11 HAM and 5 BOT projects. • Debt Reduction: Proceeds from asset sales to reduce debt and fund new projects. • Fund Allocation: Settling liabilities with SBI Macquarie and reducing standalone debt.
Concerns and Future Outlook • Potential Flat Growth: Concerns raised about FY '25 growth due to limited order backlog. • Order Inflow Guidance: INR 6,000-8,000 Crore for FY '24. • International Projects: 36% completion in Guyana, ongoing work in Bangladesh.
Capital Expenditure and Project Focus • Annual Capex Plan: INR 60-100 Crore for equipment. • Sector Participation: Involvement in highways, railways, power distribution, buildings, and water projects.
Conclusion • In-House Capabilities: Reliance on internal teams for project execution. • Engagement with Investors: Invitation for further inquiries through the investor relations team.
Ashoka Buildcon Limited Q2 FY '24 Earnings Conference Call Summary
Conference Call Overview • Date: November 9, 2023 • Submission to: BSE and NSE on November 13, 2023 • Participants: • Managing Director: Satish Parakh • CFO: Paresh Mehta • Moderator: Ashish Shah (JM Financial)
Sector Update • Projected 16% to 21% increase in order execution by MORTH for FY 2024. • Recent project awards in Maharashtra and Telangana. • Current order book: INR 14,795 crores, diversified across highways, railways, power transmission, and buildings.
Financial Performance • Q2 FY '24 Total Income: INR 1,590 crores (21% increase YoY). • EBITDA: INR 172 crores (10.8% margin). • H1 FY '24 Total Income: INR 3,147 crores (12% increase YoY). • Consolidated Q2 FY '24 Total Income: INR 2,195 crores (19% increase). • EBITDA: INR 587 crores (26.7% margin). • Margin recovery anticipated to 10-11% by Q1 FY '25.
Project Updates • Progress on Chennai ORR and ongoing asset sales negotiations. • Expected closure of asset sales by Q4 FY '24.
Investor Inquiries • Asset Sales Timelines: • Mahanagar Gas: Expected closure in Q4. • Chennai ORR: Delays due to partner disagreements, aiming for Q4 finalization. • Jaora Nayagaon: Pending NOC, expected by Q4 or early Q1.
• Order Book Concerns: • Focus on securing INR 4,000-5,000 crores in orders by March.
• Bidding Pipeline: • Significant orders from NHAI and MoRTH; no participation in station redevelopment projects.
• Margin Improvements: • Projecting 15% revenue growth for the current year.
• Payment Timelines: • NHAI payments are timely.
Additional Discussions • Toll Collections Growth: Attributed to economic growth and toll rate hikes. • Standalone Debt: Projected reduction following asset transactions. • Competitive Intensity: Updates on T&D segment and potential water EPC sector entry. • Return Metrics: New generation exploring sectors to enhance margins and returns.
Conclusion • Management expressed optimism about future orders, project execution, and asset valuations. • Call concluded with gratitude and Diwali wishes.
Revised Transcript Submission • Date: August 17, 2023 • Purpose: Correct typing errors from the August 11, 2023 call.
Financial Highlights • Total Income Growth: 3% year-on-year. • Standalone Income: INR 1,557 Crores. • Consolidated Income: INR 1,973 Crores. • EBITDA Margins: Affected by inflation and a one-time provision for a solar project. • Order Book: INR 16,920 Crores, focusing on sustainable EPC and HAM projects.
Q&A Session Insights • Provision Clarifications: • 25 Crore provision related to SBI Macquarie liability. • 56 Crore one-time provision for a solar project, not affecting future P&L. • International Projects: Confirmed commencement in Bangladesh; Maldives orders expected soon. • Interest Costs: Increased due to rising repo rates and higher working capital utilization. • Topline Growth Expectations: Projected at 15% for the year. • Financial Costs: Ongoing costs related to Macquarie liability discussed. • BOT Monetization: Expected signing of SPA for HAM projects in 2-4 weeks.
EBITDA Margin Forecast • Short-term Forecast: 8-8.5% for the next few quarters. • Long-term Forecast: 10-10.5% post FY2024-2025.
Capital Expenditure and Debt Management • Capex Guidance: Approximately 100 Crores for FY2024, with 47 Crores already spent. • Debt Increase: From 488 Crores in FY2022 to 990 Crores, attributed to larger project execution. • Asset Monetization Plans: Proceeds to help exit SBI Macquarie agreement.
Revenue Growth and Project Execution • Q1 Revenue Growth: Lower than expected due to mobilization phase of new projects. • Future Growth Anticipation: Expected growth in Q3 and Q4. • Consolidated Debt Projection: Expected to decrease to 500-600 Crores by March 2024.
Conclusion • The call concluded with acknowledgments and an invitation for further inquiries from participants.
Ashoka Buildcon Limited Q1 FY2024 Earnings Conference Call Summary
Date and Submission • Date of Call: August 11, 2023 • Submission to BSE and NSE: August 17, 2023
Financial Highlights • Total Income Growth: 3% year-on-year • Standalone Income: INR 1,557 Crores • Consolidated Income: INR 1,973 Crores • EBITDA Margins: Affected by inflation and a one-time provision for a solar project • Order Book: INR 16,920 Crores, primarily from road and railway projects
Key Discussions • Provisions and Refinancing: • 25 Crore provision related to SBI Macquarie clarified • Sambalpur project refinanced with SBI, reducing interest to 9% and extending repayment by 8 years • One-time provision of 56 Crores for solar project, not impacting future P&L
• International Projects: • Bangladesh project underway; Maldives orders expected soon • Anticipated topline growth of 15% for the year
• Debt and Financial Management: • Total debt approximately 5,640 Crores; 1,800 Crores for assets under construction • Plans to monetize land assets and utilize proceeds for debt settlement
Revenue and Growth Expectations • Revenue Growth: Adjusted to 7-7.5% margins for the upcoming year • Capex Guidance: 100 Crores for FY2024 • Build Pipeline: Approximately 25,000 Crores, mainly in highway projects
Participant Inquiries • Equity Infusion: ₹169 Crores yet to be deployed in HAM projects • Debt Concerns: Increased from ₹488 Crores in FY2022 to ₹990 Crores due to execution and turnover • Project Delays: Maldives project delays due to insurance issues
Conclusion • Future Outlook: Positive despite challenges, with expectations of reduced consolidated debt and improved order inflow • Engagement: Management expressed gratitude for participant inquiries and encouraged further questions.
Ashoka Buildcon Limited Q4 FY'23 Earnings Conference Call Summary
Key Highlights • Date of Call: May 25, 2023 • Submission to BSE and NSE: Transcript submitted on May 31, 2023 • Management Present: Satish Parakh (Managing Director), Paresh Mehta (CFO)
Financial Performance • Q4 FY'23 Standalone Results: • Total Income: INR 2,067.9 crores (27% YoY growth) • EBITDA: INR 174.4 crores (8.4% margin) • Profit Before Tax: INR 457.8 crores (boosted by exceptional gains)
• Full Fiscal Year Results: • Total Revenue: INR 6,478 crores (35% increase) • Profit After Tax: INR 671.3 crores
• Consolidated Results: • Q4 Total Income: INR 2,478 crores (20% growth) • EBITDA Margin: 23.6% • Consolidated PAT: INR 372.9 crores
Order Book and Projects • Current Order Book: INR 18,090 crores • Focus Areas: Road and railway projects (INR 15,805 crores) • Divestment: Sale of 100% stake in Unison Enviro for INR 531 crores • Future Guidance: Order inflow of INR 6,000 to 8,000 crores for FY'24
Debt and Financial Strategy • Total Consolidated Debt: INR 6,895 crores • Project Debt: INR 5,819 crores • Debt Reduction Plans: Monetization of operational assets to lower debt significantly within two years
Operational Insights • Asset Monetization: Plans to sell 11 operational assets, targeting double-digit margins by FY'25 • Geographical Focus: Land parcels primarily in Nashik, Pune, and Madhya Pradesh (book value: INR 270 crores) • CAPEX Plans: INR 80 to 90 crores for FY'24, mainly for new projects in Kerala
Project Updates • NHAI Pipeline: INR 72,000 crores, with INR 30,000 crores expected to be bid soon • Railways Sector: Anticipated opportunities worth INR 20,000 crores • Chennai ORR and Jaora-Nayagaon Projects: Expected cash inflows of INR 450 crores and INR 300 crores, respectively
Challenges and Resolutions • Debarment Issue: Previous debarment from bidding resolved, allowing participation in new bids • Land Acquisition Issues: Addressed delays in projects due to land acquisition challenges
Conclusion • Future Outlook: Strong order book projection of over INR 20,000 crores for FY'24, with a focus on roads and railways • Interest Rates: Current consolidated debt interest rates range from 9% to 10% • Invitation for Queries: Call concluded with an invitation for further offline questions.
Ashoka Buildcon Limited Q3 FY '23 Earnings Conference Call Summary
Date and Submission • Date of Call: February 13, 2023 • Submission to BSE and NSE: February 17, 2023
Key Management Participants • Managing Director: Satish Parakh • CFO: Paresh Mehta
Financial Highlights • Q3 FY '23 Performance: • Total income: INR 1,996 crores (up 35% YoY) • EBITDA: INR 530 crores (26.6% margin) • Nine Months FY '23 Performance: • Total revenue: INR 5,757 crores (up 41% YoY) • Standalone Q3 FY '23: • Total income: INR 1,590 crores (up 40% YoY)
Debt and Asset Sales • Consolidated Debt: INR 6,987 crores as of December 31, 2022 • Asset Sales: • Significant transaction involving five SPVs valued at INR 1,337 crores • Expected cash inflow from KKR deal by Q2 FY '24
Order Book and Growth Prospects • Current Order Book: INR 19,150 crores • Growth Expectations for FY '24: 20-25% • Focus Areas: Expanding EPC business in highways, railways, and power transmission
Challenges and Margin Outlook • Challenges: Competitive bidding and inflation affecting margins • Future Margin Expectations: Anticipated improvement to 9.5-10% in upcoming quarters
Project Updates • Delayed Projects: Executable order book includes INR 1,500 crores delayed • Specific Projects: • Maldives project clearance expected by March • D.Y. Patil project delayed due to disputes
Financial Metrics • Trade Receivables: INR 1,192 crores • Unbilled Revenue: INR 1,528 crores • Trade Payables: INR 1,147 crores • Inventory: INR 297 crores
Future Strategies • Capex Plans: INR 250 crores over the next five quarters • Debt Management: Focus on maintaining low consolidated debt levels
Investor Inquiries • Concerns Raised: • Cash flow and tax implications • Revenue guidance and margin expectations • Status of KKR deal and project timelines
Conclusion • Management expressed confidence in future growth and addressed investor concerns regarding debt reduction and project timelines. Further updates on asset monetization and project statuses are expected in the coming months.