Oriental Rail Infrastructure Ltd (ORIRAIL) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, good day and welcome to the Q2 FY27 earnings conference call of Oriental Rail Infrastructure Limited. 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 Mr. Akhilesh Gandhi from Stellar IR. Thank you and over to you, Mr. Gandhi.
Akhilesh Gandhi (Stellar Investor Relations): Thank you, Rutuja, and good afternoon, everyone. Thank you for joining us this Saturday morning. I, Akhilesh Gandhi, on behalf of Stellar Investor Relations, welcome you all to the Oriental Rail Infrastructure Limited's Q2 and H1 FY27 earnings conference call. Today, we shall be sharing the key operating and the financial highlights for the second quarter ended on 30th September 2026. Today, we have with us the senior management team of Oriental Rail Infrastructure Limited, mainly Mr. Saleh Mithiborwala. He is a Chairman and Managing Director along with CFO as well. With him, we have Mr. Taha Mithiborwala, he is a whole-time director, and Mr. Najmuddin Mithiborwala, he is our chief strategy and Investor Relations Officer. But before we begin, I would like to state that this call may contain some of the forward-looking statements, which are completely based upon the company's beliefs, opinions, and expectations as of today. The statements made in today's call are not a guarantee of future performance and also involve unforeseen risks and uncertainties. The company also undertakes no obligation to update any forward-looking statement to reflect developments that occur after the statement is made. Documents related to company's financial performance, including the investor presentation, is already been uploaded on the stock exchange. With that, I now invite Mr. Saleh Mithiborwala to share his initial remarks on the company's performance for the second quarter. Thank you, and over to you, sir.
Saleh Mithiborwala (Oriental Rail Infrastructure Limited): Good afternoon, everyone. A very warm welcome to the Oriental Rail Infrastructure Limited financial year '27 Q1 earnings conference call Q2 earnings conference call. First, I would like to thank all those who are with us joining us today to find out the time and especially on a Saturday. We sincerely appreciate your interest in our company and look forward to further fruitful engagement with you. Following our first earning calls last quarter, we are pleased to continue our engagement with the investment community and share updates on our financial performance, the plans for business development, and the growth initiatives taken by the company. I hope you have had an opportunity to review our financial results and the investor presentation uploaded on the stock exchanges. For those joining us for the first time, I will briefly, again, introduce our business. Established in 1991, Oriental Rail Infrastructure has over three decades of experience in the Indian railway ecosystem. Today, we operate through two complementary business verticals supported by four manufacturing units spread across approximately 100 acres. Our first vertical is the rolling stock interior and allied products housed with the listed parent company. We have an established position in the organized seat and berths market with an estimated 30% market share and installed capacities of approximately 3,600 coach sets annually.
Saleh Mithiborwala (Oriental Rail Infrastructure Limited): As explained, we manufacture the artificial leather under the brand name of ORVIN, serving railway and other non-railway applications. The second vertical is the freight wagons and wagon components operated through our wholly-owned subsidiary Oriental Foundry Private Limited or OFPL. OFPL operates an RDSO approved manufacturing platform with an installed capacity of 2,400 wagons annually. We have delivered close to 3,000 wagons as on date. Our integrated operations include in-house manufacturing of critical components such as bogies, couplers, draught gears, springs, providing greater control over quality, supply, and manufacturing costs. Together, these businesses give us an established presence across both passenger and freight railway segments. With that brief background of our company, I would like to now move forward towards the financial performance in the quarter two of financial year 2007. Supported by improved order execution and healthy business volumes, our consolidated revenue stood at 172.5 crores growing 29% year-on-year. EBITDA increased by 29% to 27.9 crores with an EBITDA margin of 16.2 while PAT grew by 44% to 15.3 crores. We also witnessed healthy sequential growth across revenue and profitability reflecting improved business momentums. For H1 financial year '27, consolidated revenue stood at 310.1 crore growing 23% year-on-year while EBITDA increased by 35% to rupees 48.88 crores and PAT grew by 58% to 26.1 crore. Importantly, profitability has grown faster than revenue supported by our favorable product mix, as explained earlier, backward integration for better cost control, improved operating leverages, and better fixed cost absorptions. Another encouraging development has been the improvement in our cash generation and financial positions. Cash flow during HY financial H1 financial year '27 stood at approximately 42 crores, improving on a year-to-year basis. Our cash and cash equivalent stood at 115 crores, while long-term debt reduced further to 16 crores. Short-term borrowings increased during the period primarily to support the higher working capital requirements associated with the increased production volumes, raw material planning, and procurement for further order executions. We remain focused on efficient working capital management and maintaining adequacy in adequate liquidity to support the business growth. Coming to our business operations, OFPL continues to demonstrate strong growth momentum, recording 41% year-on-year revenue growth in H1 financial year '27 to rupees 250 crores. During quarter two financial year '27, we manufactured 390 wagons compared with 300 300 wagons in quarter one financial year '27, representing sequential growth of 30%. We are encouraged by this improvement and remain further focused on increasing production and capacity utilization. In our seat and berth business, we secured multiple orders during the quarter and first half. Given the longer duration nature of this contract and the scheduled deliveries, we expect higher revenue recognition in H2 as compared with H1. Our consolidated order book stood at approximately 1,571 crores as of October 21, 2026, representing 2.74x financial year '26 revenue. This provides strong revenue visibility and a healthy execution pipeline available across both businesses. Alongside our core operations, we continue to make progress on
Saleh Mithiborwala (Oriental Rail Infrastructure Limited): strategic growth opportunities across the railway value chain. Starting with the smart wagon technologies, through our partnership with Amm International, we have participated in the RDSO development tender for approximately 300 to 400 smart wagons, with the financial bids expected to open shortly, and orders to be decided very soon. We remain optimistic about the opportunity and see strong potential in the smart on-board monitoring systems which greatly help railways in having a predictive maintenance plan across their vast railway network. On next generation wagon, OFPL has already taken the technology development agreement with the UniWagon Design and Engineering Centre, a Russia based company. The arrangement covers the development of a better performing 25 ton axle load bogie and solid bottom gondola car, including the technical documentation, testing support, and prototype manufacturing support. This represents an important step in expanding our product portfolio and not only developing higher capacity, but also having a edge as far as a technically superior wagon for the end-user, which will be highly beneficial in terms of performance and maintenance cost to the end-users. In the railway coach refurbishment segment, we have recently formed, entered into a joint venture agreement with a well-known company for interior products, like FRP panels, etc., under the name and style of Abarro Projects LLP. We have actively participated in refurbishment and turnkey projects tenders. We are seeing encouraging opportunities in this segment and remain highly optimistic about potential order wins. With this joint venture, the interior business of Oriental Rail, the parent listed company, is expected to be more than 80% of the turnover in financial year 2026, and FY26. Looking ahead to H2 financial year '27, our immediate priority remains the timely execution of our existing order books. We expect stronger execution across both our freight wagon and railway interior business, supported by improving production and scheduled deliveries and a better supply chain management which is already in place. At the same time, we remain focused on improving capacity utilization, strengthening operational efficiencies, and maintaining disciplined working capital management. To conclude, we are encouraged by our first half performance, with strong operating momentum, a robust order book, and improving financial position and multiple growth opportunities. We believe we are well-positioned to build on this performance. Our focus, as mentioned above, remains on sustainable growth. Not only sustainable growth, but improving our growth in the coming period substantially, which will lead to improved profitability and create long-term value for our esteemed stakeholders. I would like to thank all our employees for their continued support, and also our shareholders and investors for their continued trust and support. Thank you once again. Now, we are happy to take the questions from your side.
Moderator: Thank you very much. We will now begin the 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 handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Moderator: First question is from the line of Harshit Khadke from Robo Capital. Please go ahead.
Harshit Khadke (Robo Capital): Hello. Am I audible?
Saleh Mithiborwala (Oriental Rail Infrastructure Limited): Yeah, you're audible.
Harshit Khadke (Robo Capital): Yes, sir. Thank you for the opportunity. So, we were expecting to produce around 500 wagons this quarter, but we managed to produce only 390. So, I just wanted to understand like what led to the shortfall and what what kind of production run rate should we expect in Q3?
Saleh Mithiborwala (Oriental Rail Infrastructure Limited): The 390 wagons which have been produced have also been the little short of the target of 500 on account of some technical changes which were to take place on the plant to achieve the 500 wagon output. This changes are being little capital means technical in nature were executed about a week back means about 15 days behind schedule and that is what drove, affected our production of 390 wagons only instead of the 500. We hope that while explaining on this, it is not that the entire wagon has not been manufactured. Work on almost 500 wagons has been substantially done, although not completed and in the coming quarter, we hope that we are very confident that we will cover the backlog of 390 and meet the demand of 500 also in the coming quarter. That is about 500 plus 110.
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