GE Vernova T&D India Ltd (GVT&D) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, good day, and welcome to conference call hosted by GE Vernova T&D India Ltd for quarter two of financial year 2026-27. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone phone. I now hand the conference over to Ms. Megha Gupta from GE Vernova T&D India Ltd. Thank you, and over to you.
Megha Gupta (GE Vernova T&D India Ltd): Good evening, everyone. Welcome to the earnings call of GE Vernova T&D India Ltd. I am Megha Gupta from Investor Relations team, and I'm joined by Mr. Sandeep Zanzaria, CEO and MD of the company; Mr. Sushil Kumar, Whole-time Director and CFO of the company; Mr. Abhishek Srivastava, Head, Business Operations; and other members of the leadership team. Before we begin, I would like to highlight that today's discussion may contain few forward-looking statements, which are subject to risk and uncertainties. These statements are based on our current expectations, and actual results may differ materially from those expressed or implied. Now, I hand over the conference to Mr. Sandeep Zanzaria to open up the discussion.
Sandeep Zanzaria (GE Vernova T&D India Ltd): Thank you, Megha. Good evening, everyone, and thank you for joining the second quarter
Sandeep Zanzaria (GE Vernova T&D India Ltd): call. The Indian power transmission sector is at its historic inflection point, moving from a centralized grid towards a more dynamic, digitalized, and decarbonized architecture. Three key pillars are defining the industry: First is unprecedented grid expansion and modernization. India's energy demand is scaling at a pace that requires aggressive expansion of transmission infrastructure. The integration of large-scale renewable energy, often far from consumption centers, requires robust long distance high voltage direct current and alternating current corridors. Second is the digital transformation of the grid. The grid has grown more complex, making advanced automations, real-time smart substations, and predictive maintenance essential to reduce AT&C losses and improve the reliability. GE Vernova is focused on providing the software and digital infrastructure required to manage this complexity. Third, the T&D sector is the backbone of India's energy transition and net zero ambition. A greener grid requires not only solar and wind capacity, but also the hardware and intelligence to balance the intermittent power sources. Systems such as Flexible AC Transmission Solutions and energy storage integration are, therefore, becoming essential for grid resilience. Coming to the financial performance. During the second quarter, we saw an order book of 24.4 billion, up 52% year-on-year compared to 16.1 billion in quarter ended September 25. Our Q2 revenue stood at 20.3 billion versus 15.4 billion INR in Q2 FY '25-26, up by 32% year-on-year. Order backlog stands at 214.4 billion as of September 26 versus 214.6 billion as of March 26. The order backlog stands at more than three years of revenue for FY '25-26. Our profit before tax and exceptional items for the quarter ended September 26 was at 5.8 billion INR compared to around 4 billion INR in the corresponding quarter of the last financial year, growing by 1.4x. Cash generation of 10.1 billion during H1. With this cash, our balance stands at the end of September at 32.5 billion. Looking ahead, our priorities are consistent: First, execution excellence on mega projects, especially our HVDC; Second, deeper localization, expanding our manufacturing footprint in India, reducing exposure to global supply chain risk, and supporting the vision of self-reliant energy sector; Third, growing our services and software business, particularly grid automation and asset performance management, where predictive maintenance and software optimization help utilities get more from the assets they already have. A heartfelt thanks to our colleagues at the project sites and in our factories. As the volumes grow, they continue to deliver with rigor and never compromise on safety. Now, I turn to Abhishek to walk through the specific operational highlights for the quarter.
Abhishek Srivastava (GE Vernova T&D India Ltd): Thanks. Thanks, Sandeep. Good evening good evening to all of you. So, I will take you through the key network augmentations that we achieved in the last quarter. So, first of the notable mentions is 400 kV substation for NEA in Nepal. So, this is for the backbone of 400 kV grid network that Nepal is trying to develop. So, earlier we had commissioned Khimti and this is the second in the lead. After that, 400 kV GIS station was commissioned for GETCO at Bardoli. In addition to that, we have been strengthening the transformation capacities at various existing and new substations and in that we commissioned 765 kV reactors for our customers PGCIL at Bikaner, Resonia at Beawar, and then 765 kV generator transformer for NUPPL at Ghatampur. In addition to that, we had GIS commissioning done at Narela in Delhi and some export jobs, one in in Spain and another one in Senegal. All these commissioning are testament of our focus in terms of network augmentation and our commitment towards operational excellence and continuously delivering on our promises to our customers. So, I hand over to Sushil now to take us forward.
Sushil Kumar (GE Vernova T&D India Ltd): Thank you, Abhishek. Good afternoon and good evening, everyone. First, I will talk about the order booking highlights for the quarter. During quarter two
Sushil Kumar (GE Vernova T&D India Ltd): secured an order intake of INR 24.4 billion, bringing our cumulative H1 order intake to approximately 35.8 billion INR. This represents an 11% growth year-on-year. Key wins during the quarter reflect our strong technical capabilities and diverse market reach, including a major package for 400 kV generator transformer and 420 kV GIS for a 1,500 MW pump storage hydro project in Maharashtra. 800 kV and 420 kV GIS packages for transmission projects in Andhra Pradesh. Supply of 400 kV reactors and 420 by 220 kV GIS package for a TBCB transmission project in the state of Himachal Pradesh. Supply of 765 kV shunt reactor for a TBCB transmission project in the state of Andhra Pradesh. Transmission packages featuring 400 kV and 765 kV reactors in Himachal Pradesh and Andhra Pradesh. And continued export momentum with multiple equipment orders for GIS, AIS across North America, Europe, Middle East, Africa alongside steady grid automation packages. Our order backlog closed strong at 214.4 billion INR, reflecting a healthy baseline as we efficiently convert our backlog into revenue. Turning now to the financial performance for the quarter and some highlights of the first half. Revenue for the quarter robust stood at 20.3 3 billion, up 32% year-on-year with H1 revenue reaching about 38.6 billion, up 35%. Gross margin for the quarter stood at 44.5%. Disciplined cost management across operations enabled us to deliver an EBITDA of INR 5.5 billion, approximately 27.1% of revenue. This EBITDA is at the higher end of our mid-20s guidance band that we have been communicating to the stakeholders in the past. Profit before tax for the quarter rose to 5.8 billion INR, and profit after tax is at 4.3 billion INR, representing 21.3% of revenue. Finance cost remained negligible with our continued net zero debt position. On the balance sheet side, we generated INR 10.1 billion of cash during first half, taking our total available cash and cash equivalents, including funds lent to the cash pool, to approximately 32.5 billion. Regarding our capital expenditure, as previously announced, the company is progressing with the capacity expansion program of approximately 10 billion, out of which roughly 20% has been already incurred. Management continues to evaluate various options for the utilization of balanced cash to optimize returns to the shareholder. I would also like to highlight the continued quality and segmentation of our orders and revenues. For the quarter, our order and revenue mix reflects a strong balanced sheet with export orders sitting at 21% and export revenues at 32%. Looking at our order and revenue split for the half year, orders stood at 29% export and revenue stood at 31% of exports. Further, our ongoing counterparty derisking strategy ensures that private customers and central utilities, PSUs continue to form an overwhelming majority of our order backlog, maintaining a robust and secure risk profile. In the presentation, we have also given the status of material related party approvals. So we had secured an approval of roughly 31 billion INR in the AGM of 2025. This was for export of various high voltage switchgear components to two related parties in Middle East and France. This this lapsed in AGM of 2026, because the the shareholder approval for the related parties is valid for a period of 1 year. And the reason is that the order is on hold from the customer side due to the operational planning delays from their side. We had also secured another approval for a related party from a US entity, largely for export of goods from India for about approximately $151 million. This approval is valid till 15th of May 2027, and the order is in discussion stage with the customer. We hope that in H2 of this financial year, we should be able to conclude this order. So summarizing before I hand back for the questions, order intake grew steadily. Revenue growth, execution pace, cash generation and backlog quality all remains strong and consistent with our full-year expectation. And we are confident of converting our 214 billion backlog profitably over the coming years. With that, I'll hand over for the question and answers.
Moderator: Thank you very much, sir. We will now begin the question and answer ses-
Moderator: Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Moderator: The first question is from the line of Sameer Thakkar from Ambit Capital. Please go ahead.
Sameer Thakkar (Ambit Capital): Hi, thanks. My first question is that GE global GE Vernova global, they announced the acquisition of Trench. They also say that they are evaluating expanding the manufacturing of Trench products in India. So, is there any view on that whether whether that will be part of GE Vernova India or is it too early to say? Just wanted your comments on that. That's the first question.
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