Om Power Transmission Ltd (OMPOWER) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, good day, and welcome to Om Power Transmission Ltd Q2 and H1 FY '27 earnings conference call. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Sayam Pokharna from TIL Advisors. Thank you, and over to you, sir.
Sayam Pokharna (TIL Advisors): Thank you, Steve. Welcome everyone, good evening, and thanks for taking out the time to join us today in the Q2 and H1 FY '27 earnings conference call of Om Power Transmission Limited. The investor presentation has already been uploaded on the Stock Exchange and on the company website. To take us through today's results, we have with us from the management team, Mr. Kalpesh Patel, Chairman and Executive Director; Mr. Kannu Patel, Managing Director; Mr. Fenil Patel, Chief Operating Officer; and Mr. Chetan Modi, Chief Financial Officer. We will start with a brief overview on the business performance from Mr. Patel, followed by opening remarks on financial performance by Mr. Modi, and then open the floor for a Q&A session. I would like to remind you all that anything and everything that is said on this call that can represent any outlook for the future and can be construed as a forward-looking statement must be viewed in conjunction with the risk and uncertainties that we face. These risk factors have been detailed in our prospectus document and in our follow-on annual report. I would also like to request all the participants to ask your questions in Hindi for the purpose of this call as the preferred language. With that said, I would now like to hand over the call to Kalpesh, sir. Over to you, sir.
Kalpesh Patel (Om Power Transmission Ltd): Good evening, and warm welcome to the quarter two, H1 FY '27 earnings conference call of Om Power Transmission Limited. I will cover the business environment, recent order wins, and revenue visibility, and the work we are doing on building our capability. Chetan will then take you through the financial performance in detail. Project execution in the second quarter and in the first half FY '27 has been healthy. The monsoon month are usually a slower period for site work in our industry, but our teams maintain the pace of execution across projects, and this is visible in our revenue booking during the period under review. Revenue from operation for the quarters stood at 128.29 CR, a growth of 56% over quarter FY '26. And for the first half, it stood at 249.93 crores, a growth of 46%. The business environment remains healthy. The transmission and distribution capex cycle in Gujarat and across the country continues to be strong, with utilities investing in network strengthening, evacuation of renewable capacity, which been growing rapidly, and the conversion of overhead distribution network into underground cabling in urban and high-density areas. On our last call, we had indicated that tender activity from JETCO was somewhat slow at the start of the financial year, and that we expect it to pick up as the year progressed. That has played out with a strong flow of orders in September and even more so in October. On the last call, we were also asked about the low share of underground cabling in our order book. We had said that a number of underground cabling tenders were in the pipeline, and we expected to recover this segment within a few months. I am happy to report that this has materialized during the quarter. We received an 11 kV underground cabling order from PGVCL for Bhavnagar and to 66 underground cabling order from JETCO. Most of the orders are in the pipeline where we have submitted our bids or the tenders are about to open. In October, we also received an underground cabling order from UGVCL for Ambaji. Both the PGVCL and UGVCL order are part of the much larger initiative. The Government of Gujarat is driving the Gujarat wire-free city mission, under which the exciting overhead power ka distribution network across multiple corporations and multi municipality in the state is to be converted into underground cable network in a phased manner by 2030, with an initial provision of 500 crores for the first phase. Through this two orders, we are directly contributing to this mission, and we expect it to generate a steady flow of underground cabling tender from the Gujarat discoms over the coming years. Underground cabling is now a meaningful part of our order book again, and with the mission underway, we expect the segment to be steady contributor going forward. Our closing order book as on 30th September 2026 stood at 5 65.99 crores. More importantly, the momentum in order this has accelerated after the quarter close. In October alone, we have won orders worth 273.21 crores. Then include to 220 kV transmission line order from JETCO, Babra-Janthra package 2 and Chorangla-Salera, the 220 kV Kotda Sangani GIS substation order from JETCO, and the UGVCL Ambaji underground cabling order I mentioned earlier. Adding the October wins to our 30th September order book, our order book today standard approximately 839 crores, before adjusting the execution during October, which is around 1.9 times our FY '26 revenue and considerably higher than where we closed the quarter. This order book give a stronger strong revenue visibility for the remaining remain remainder of FY '27 and well into the start of FY '28. Our projects are typically executed over 12 to 24 months,
Kalpesh Patel (Om Power Transmission Ltd): With the current order book and the pipeline of tenders under evolution, we are confident of of delivering the growth we have aimed for FY '27 and sufficient sustain the momentum beyond. A word on margins, EBITDA margin for the quarter was 15.2% higher than our steady state trends. This was on account of the business segment mix and project mix specific to this quarter. As we have said before, individual quarters can show variations in either direction, depending on which projects are which stage of execution. I would also like to highlight marquee project execution. We have commissioned the 400 kV GIS substation at Dholera, which is one of our largest projects to date, and the associated 400 kV transmission line at Dholera, which involves pile foundations and river crossing work are in the final stage of completion. The successful execution of a 400 kV GIS substation establishes our credential at this voltage class for GIS projects, and we accept it to become the foundation for more GIS substation orders in the future. At the same time, we continuous to work on moving up the value chain. GETCO is planning for 765 transmission network in Gujarat in a big way, and we intend to participate as those tenders come up building on our 400 kV experience. We are also strengthening our capability, CAPEX capability to take on more complex projects such as GIS substations, pile foundations, and river crossing transmission line, and HVDC. Over the medium to long-term, the complex project require specialized engineering and execution skills, and we believe they will support both our growth and our margin profile as our mix move in the direction. To sum up, we have had a strong first half. Our order inflow has picked up sharply, and our order book is at a level that gives us clear visibility. Our priority for the second half are: timely execution, continuous discipline on working capital, and preparing for the next set of higher-value projects. With that, I hand over the session to take your through of the finance. Thank you.
Chetan Modi (Om Power Transmission Ltd): Thank you, Kalpesh sir. Good evening everyone. Let me take you through the financial performance for the second quarter and first half of the FY '27. Revenue from operations for Q2 FY '27 stood at 120 128.29 crores, a growth of the 56.4% over the 82 crores in Q2 FY '26. EBITDA for the quarter stood at 19.56 crores, a growth of the 111.3% on year-on-year basis. EBITDA margin was 15.25% compared to 11.29% in Q2 FY '26 and 12.15% in Q1 FY '27. As Kalpesh sir mentioned, margin for the quarter was elevated by the business segment and project mix in this particular quarter. Profit after tax for the quarter stood at 13.85 cr, growth of the 116.7% year-on-year basis with a PAT margin of 10.7% against the 7.7% in Q2 FY '26 and 8.6% in Q1 FY '27. Earning per share for the quarter was 4.04 compared to 2.54 in Q2 FY '26 and on the expanded share capital after the IPO. H1 FY '27 performance: For the first half, revenue from operations stood at 249.93 crores, a growth of the 46.3% over the 170.88 crores in H in H1 FY '26. EBITDA was 34.34 crores, up 61.4% at a margin of 13.74% compared to 12.45% in H1 FY '26. Profit after tax, Rs. 24.37 crores, upward by 65.3% with a profit margin with a after-tax margin at 9.7% against the 8.6%. Earning per share for the half year was 7.24 against 5.92. Moving to the balance sheet. Net worth as on 30th September '26 stood at 283.43 crores compared to 136.94 crores at March '26, reflecting the IPO proceeds and profit for the half year. Gross borrowing reduced to 24.06 crore from 47.67 crore at March '26 as we prepaid the Rs. 25 crores for borrowing from IPO proceeds.
Chetan Modi (Om Power Transmission Ltd): we hold a cash, bank balance and the liquid investment of 38.34 crores. So, the company is in the net cash rich position. That to equity stands at 0.08 x compared to the 0.35x at March 26 on an expanded equity base. Working capital and cash flow front, on working capital trade receivables stood at Rs 237.06 crores against 221.42 crores at March 26. An increase about the 7 percentage in the receivables on half yearly revenue base that is at the 46% higher than last year. Does indicating much a better control over the cash flows. Trade payables reduced to 88.11 crores from 123.55 crores coinciding with the deployment of IPO proceeds towards the working capital, availing the cash discounts in procurement wherever appropriate. As a result, net cash used in operating activity for the half year was 38.0 38.20 crores negative. Which mainly reflects the 35.98 crores reduction in the trade payables. Our collection cycle with the PSU customers remains on terms we describe on our last call. of the net IPO proceeds 119.32 crores, 108.56 crores had been utilized as on 30th September 26. 25 crores towards the prepayment of borrowings, 55 crores towards long term working capital requirement, 28.11 crores towards general corporate purposes and 0.46 crores towards capital expenditure. The balance of the Rs. 10.75 crores ear marked for the capital expenditure on machinery and equipment will be deployed in line with the project requirements. To summarize, the first half has delivered strong growth in the revenue and profits. And the balance sheet has been strengthened by the IPO and is net cash rich position. And the order book at this point gives a good visibility for the second half. With that, we opens the floor for the questions. Thank you.
Moderator: Thank you, ladies and gentlemen. We will now begin with a question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Participants are requested to ask their questions in Hindi. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Raunak Bajpai with Wealthmine Advisory. Please go ahead.
Raunak Bajpai (Wealthmine Advisory): Hello, sir, am I audible?
Chetan Modi (Om Power Transmission Ltd): Yes, good evening, sir.
Raunak Bajpai (Wealthmine Advisory): Sir, so my first question was any update on 765 kV GETCO and HVDC project in terms of timeline, what kind of timeline are we expecting? Also, you had mentioned [inaudible] 100 crore order book, so any commentary on that?
Kalpesh Patel (Om Power Transmission Ltd): Sir, generally 765 ka value of amount minimum 24 months to 36 months.
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