Pace Digitek Ltd (PACEDIGITK) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (Antique Stock Broking Limited): Ladies and gentlemen, you have been connected to the Pace Digitek Q2 FY27 earnings conference call hosted by Antique Stock Broking Limited. Please stay connected, the conference will begin shortly.
Moderator (Antique Stock Broking Limited): Ladies and gentlemen, good day, and welcome to Pace Digitek Q2 FY27 earnings conference call, hosted by Antique Stock Broking 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 touch-tone phone. Please note that
Moderator (Antique Stock Broking Limited): conference is now being recorded. I now hand the conference over to Mr. Ishan Varma from Antique Stock Broking Limited for opening remarks. Thank you and over to you, sir.
Ishan Varma (Antique Stock Broking Limited): Thank you, ma'am. Good afternoon, everyone. On behalf of Antique Stock Broking, I welcome you all to the 2Q FY '27 post-results conference call of Pace Digitek Limited. We have with us today from the management, Mr. Rajiv, Whole-time Director; Mr. Rajagovindan, CFO; and Mr. Ajay, Head of In- Investor Relation. We will begin with a brief opening remarks from the management followed by the Q&A session. Thank you and over to you, sir.
Rajiv (Pace Digitek Ltd): Good afternoon, everyone, and thank you for joining Pace Digitek Limited Q2 and H1 FY '27 conference call. I am Rajiv, Whole-time Director. Along with my team, we'd we'd like to take you guys through the key developments and key figures for this financial year. So, on behalf of Pace, I would like to welcome all the shareholders, investors, and analysts on this call. I hope you had the opportunity to review our financial results and our investor presentation, which we have uploaded in the exchanges. We have delivered a strong performance in the first half of FY '27, with growth across both our energy and telecom business. During this period, we have extended our expanded our B BESS manufacturing capacity. We have progressed in several of our battery energy storage projects, and we've reached in at a much better stage in all of these projects. I'd like to take you through some of the key developments for the first half of this financial year. Our energy business continues to be the growth driver for this company this year and the the years to come. The As the demand for BESS has increased multifold in the last one year and the years to come, we are seeing a growth opportunity of about 236 gigawatt-hour by FY FY30, I mean, FY32, of which we are we we would want to be the major contributors. So, we through with this we are seeing a good opportunity ahead of us, specially in the BESS segment. During our H1 of FY '27, we have commissioned about 875 megawatt-hour of BESS capacity at our project sites. Standing today, we have delivered about 1.8 gigawatt-hour of BESS to our customers, and we've commissioned about 1 gigawatt-hour at our own project sites. Our execution has spread across different types of contracts, including BESS supply, EPC, build-own-operate projects. This gives us ability to participate across different stages of energy storage value chain, from manufacturing to supply and to long-term developer projects. During the first half, we have also secured significant orders in energy segment, including BESS EPC orders from NLC India, DVC, BSES Rajdhani Power, and BESS supply orders from NGSL and more other customers. These are orders demonstrate our ability to participate in large utility-scale storage projects across different bad business models. A small key update regarding our manufacturing expansion. In August 2026, we have expanded from 2.5 to 5 gigawatt-hour capacity. And and we have also produced about 844 megawatt-hour of BESS capacity in this first half of the year. That in perspect, in numbers, we the capacity which that is about 94% of the capacity, which we produced in the whole year of last financial year, we have produced in this first half of the this financial year. So, we are doing great progress in our BESS capacity. And and our productions are running at full capacity standing today of 5 gigawatt-hour. We have also successfully developed our in-house BESS container facility, and we have also commenced the production of BESS containers standing today, and we will reach full capacity of production by December or November or December of this financial year. And with this BESS fabrication facility, we will be able to produce about 50% of the capacity of of our BESS that we are manufacturing in-house. We have also successfully commenced production of our 200
Rajiv (Pace Digitek Ltd): achieve 1 kilowatt hour C&I cabinets. And we have made sample productions to couple of our customers, and we are expecting much bigger orders in the C&I market in the days to come. A small note on the Telecom business. We have successfully commissioned more than 8,000 sites of BSNL, which is one of our largest projects that we have won in the Telecom business. And these 8,000 sites have also gotten into the O&M phase, which we have for the next five years. During H1 of FY '27, we've also secured additional telecom orders, especially in the BSNL and in the BharatNet OFC projects. And we have a couple of more projects in the pipeline expected to win later this financial year. Standing today, our order book, our executable order book stands at 10,735 crores compared to 8,528 crores in energy it which comprises of 8,528 crores in Energy and 2,208 crores in Telecom. During H1 FY '27, we have secured inflows of about 2,437 crores of which 2,173 crores comes from our Energy and 200 and 6, 265 crores comes from our Telecom business. So, I'd like to hand it over to our CFO to take you through the numbers.
Rajagovindan (Pace Digitek Ltd): Yeah. Thank you, Rajesh. Good afternoon, everyone. Now, I would like to take you through the financial and operational performance for the quarter and half year ended 30th September 2026. So, starting with the consolidated financial performance, the revenue from operations for Q2 stood at 808 crores, registering a growth of 51.5% year-on-year and 45.5% quarter-on-quarter. For H1 FY '27, the revenues stood at 1,364 crores representing a growth of 51.4% over H1 FY '26. The Energy segment contributed to about 80% of the revenue, while Telecom contributed 20% to the overall top line. The growth of this top line is is is supported through higher execution of Energy segment including the BESS supplies and the project deployment including the EPC activities. The Telecom revenue was supported majorly by BSNL supplies and ongoing O&M operations. So, including the maintenance of the 4G network of BSNL. Our employee expenses in Q2 stood at 37 crores compared to 24 crores in Q2 FY '26 and for H1, the employee expenses stood at 70 crores compared to 44 crores of the previous financial year. The increase in employee cost is majorly driven by increase the growth in the business operations and with the additional manpower deployed across the energy projects and manufacturing operations. These investments are intended to support the growing scale of operations of our business and expanding order book. The EBITDA for Q2 increased to 159 crores compared to 94 crores in Q2 of the last financial year registering a growth of 68.5% year-on-year. H1 EBITDA stood at 245 crores, registering a growth of 40.5% compared to the last financial year. The finance cost increased to 36 crores in Q2 compared to 28 crores in Q1. The finance cost also increased primarily due to the funding requirements for the Build-Own-Operate developer project and the increased working capital to support the increased capacity of our BESS manufacturing. The PAT for Q2 increased by 43.3% to 97 crores and H1 profit H1 PAT stood at 160 crores, which is again an increase of 30.4% year-on-year. This increase is in line with our views keeping the margin constant. So, moving to the balance sheet and the and the say subsequent returns. Say as on 30th September, the total equity stood at 2,428 crores compared to 2,252 crores, which is primarily due to the addition of the PAT. The total borrowing stood at 1,371 crores as on 30th September compared to 961
Rajagovindan (Pace Digitek Ltd): So, which clearly states that our increased borrowing is to support the increased capacity required, increased requirement of the build-own-operate projects. The cash and bank balances stood at 515 crores resulting in a net debt of 856 crores as on 30th September. The net debt-to-equity ratio stood at 0.35x compared to 0.09x as on 31st of March 2026. And as I explained that the increase in the increase in this ratio is due to the increase in debt to support the build-own-operate projects. On the working capital front, the total receivables declined to 2,177 crores as of 30th September compared to 2,442 crores say, in 31st of March 2026. The reduction of this receivables, say, clearly reflects the improvement of overall receivable portion as we keep stating that we started collecting the retention portions of the older projects. The return on equity stood at 13.2% while the return on capital employed stood at 12.6% for this H1. So, in terms of the CapEx plan, as Mr. Rajeev was explaining, we have expanded our capacity to 10 GW hour, and also we are expanding it to 10 GW hour by next quarter. Today we are at 5 GW hour, and also we have established our in-house container fabrication facility. Most of that capital requirements are already taken care. The final lot of expenses to be incurred in the next 2 years time. The overall approach remains to align the capital deployment with the project execution, the commissioning schedules, and the expected cash flow from these assets. Given our H1 performance and the execution visibility, we have revised our FY '27 revenue guidance upwards to 3,300 to 3,500 crores range, against our earlier guidance of 3,200 to 3,400 crores. This revision is supported by the 51.4% revenue growth in H1 and our executable order book of 10,735 crores as of 30th September, 2026. For FY '28, we expect the revenue to be in the range of 4,000 to 4,200 as per the earlier guidelines. So, with this, I conclude my remarks, and I will now hand over the call to the moderator for the Q&A session. Thank you.
Moderator (Antique Stock Broking Limited): 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 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. The first question comes from the line of Deepak Poddar from Sapphire Capital. Please go ahead.
Deepak Poddar (Sapphire Capital): Yeah. Am I audible, sir?
Rajagovindan (Pace Digitek Ltd): Yes, you are audible.
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