Sugs Lloyd Ltd (SUGSLLOYD) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (Vasuvi Financial Advisory): Ladies and gentlemen, good day, and welcome to the Sugs Lloyd Limited Q2 FY '27 post-result conference call, hosted by Vasuvi Financial Advisory. As a reminder, all participants' lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need any assistance during this conference, please signal for an operator by pressing star followed by zero on your touchtone telephones. I now hand the conference over to Mr. Satyakam Basu, CEO, Sugs Lloyd Limited. Thank you, and over to you, sir.
Satyakam Basu (Sugs Lloyd Ltd): Hi. Good afternoon, everybody, and thank you for joining us. You know, when we listed in September '25,
Satyakam Basu (Sugs Lloyd Ltd): committed to speaking to you every quarter, though it is optional for SME platform listees to do it or not to do it, but we always have done it, and today's call is part of the same commitment. For those who are joining us for the first time, let me give you a quick introduction to the company. Sugs Lloyd is an energy infrastructure company. We have been in the sector since 2009, almost 17 years now, and we have a team of over 1,000 people. We work across three main lines of business: Power Transmission & Distribution, including smart grid, solar EPC, and our engineering products, which is led by our fault passage indicator, where we are India's largest manufacture with manufacturer with more than half of the domestic market, as per our estimate. Over the years, we have completed more than 80 projects, and this year, we were named the Best Integrated Transmission Distribution and Solar EPC Company of the Year at the EPS Energy Awards 2026. In July, we reported the strongest first quarter in Sugs history. I am pleased to tell you that the second quarter has surpassed it. Q2 revenue was 134.91 crore, up 112% on the same quarter last year and up 72% on the preceding quarter, which is the Q1. Together, these two quarters make H1 FY '27 the strongest half-year that the company has ever delivered. Let me take you through the numbers for the half. Revenue from operations was 213.31 crore, up from up by 73% from 123.03 crore of last year. EBITDA is up at 31 crore, up 64% again, at a margin of 14.5%, and it is within the margin of 14% to 15% band that we have always committed. Profit after tax was at 20 crore, 20.01 crore to be precise, up 69%, and EPS were at Rs. 8.62 against 6.86. So, to put the half in context, in six months, we have already delivered 71% of the revenue we recorded the whole year of FY '26. The second quarter, on its own, was equally strong. EBITDA was 19.09 crore 01 crore, up 91% year-on-year and 59% quarter-on-quarter. Profit after tax, PAT is at 12.51 crore, up 108% year-on-year and 67% quarter-on-quarter. We are also growing very more efficiently. Our interest cover improved to 5.2 times in the first half from 4.8 times a year ago, and finance cost came down to 2.8% of the revenue from 3.2% of the year before. Of the revenue mix, Power T&D and smart grid contributed to about 80% of our H1 revenue, against 46% for FY '26 as a whole, as execution on our RDSS and other distribution projects moved to into full swing. Solar EPC contributed the balance. I want to spend a moment on execution, because that is what these numbers really reflect. Our flagship Patna project, valued at around four 542 crore pre-GST, is in full execution and scheduled for completion by March '28. Running it alongside our other projects has meant mobilizing more people, more equipment, more vendors across many sites at the same time. The capability we have built there, especially in the SCADA and ADMS, is now a credential we are taking to other states. Delivering a half-year of this size tells you the systems are holding as we scale up. Now, to orders, which I think is the most important part of this quarter's story. In Q2, we won seven new orders worth 395 crore, excluding GST, or 466 crore, including GST. This is almost 3 times the revenue we billed in the quarter. Our order book as on 30th September stood at 1,067 crore, about 3.5 times of our last year's revenue, of which about 929 crore is the Power T&D and the rest is in solar. What mattered much
Satyakam Basu (Sugs Lloyd Ltd): Every one of the seven orders is from outside Bihar, which traditionally has been our stronghold. As a result, Bihar's share of our order book has come down from about 82% at the end of the July to about 55% now. And we operate across 11 states. This is exactly the diversification we told you in our last call that we are working towards. The quality of the book matters as much as its size. About 9/10 of our order book is with government utilities, PSUs and centrally funded schemes, and a good part of the rest is with Tata Power's DISCOM and other established private utilities. This gives a strong payment security across our projects. The new orders also add visibility. The Odisha maintenance contract started on 1st October and will be every month for three years, adding a recurring base of roughly ₹60 crore a year. The Punjab RDSS work is to be completed over 15 months, and the Amritsar solar plant is scheduled for completion by December. Together, this gives us good visibility on the revenue for the coming quarters. Our bid pipeline gives us confidence about the orders still to come. Of the tenders we tracked, about ₹19,150 crore has been floated. We have selected about ₹6,600 crore to bid for, and about ₹1,260 crore are now at the final stage of evaluation. Roughly ₹800 crore in power T&D, ₹400 crore in solar and storage, and ₹60 crore in products. We continue to target a strike rate of 15% to 20% on qualified bids and 10% to 15% in spaces that are new to us. Products are one of the most important growth engines, as you all know. The Madhya Pradesh and Noida Power orders I mentioned bring two more utilities into our fault passage indicators and recloser platform. And once a DISCOM adopts these devices, repeat orders always tend to follow. With about 2.65 lakh feeders across the country, the market is very large. Products carry better margin than our EPC work, and we aim for them to reach about 10% of our revenue by FY28. Let me also talk about the working capital and the cash flow, which we are managing very actively as we grow. Receivables have grown with billing, but collections are keeping pace. On a trailing 12-months basis, our receivable days has improved from about 179 in June '26 to about 150 days in September. Operating cash outflow for the half was ₹12 crore against ₹37 crore for the whole year of FY26. In the coming quarters, we are focused on improving this further. As our Patna project moves into its bulk billing phase, we expect the working capital cycle to shorten. We are working closely with our clients on faster milestone certification and release of payments, and we are using surety bonds in place of cash-backed bank guarantees, along with TReDS and purchase bill discounting to free up the working capital. So, looking ahead, our business has always been weighted towards the second half of the year, and especially the March quarter. Our priorities are clear: deliver the Patna milestones, ramp up the new Punjab and Odisha work, convert our final stage tenders into orders, and keep improving cash flow. We go into a second half with the largest order book in our history and a far, far wider geographic base than a year ago. With that, I'll hand over to our Chairman and Managing Director, Mr. Santosh Shah, for his remarks. Thank you.
Santosh Shah (Sugs Lloyd Ltd): Thank you, Basu Sahab. Good afternoon to everyone on the call. A company earns trust over time through what it delivers and how consistently it communicates, and that is the standard we hold ourselves to every quarter. We are building Sugs Lloyd to last for generations, and every decision we take is guided by that long-term vision. We are steadily working to increase the contribution of products in our revenue, and we will share that progress with you in numbers, quarter after quarter. The compact FPI has completed its testing, and we will supply the first unit in one of our existing order within this quarter. Our work on vacuum circuit breakers and Ring Main Units is progressing as planned. We are also working on backward integration
Santosh Shah (Sugs Lloyd Ltd): and contemplating to manufacture some of the items that we buy the most. This will give us better control of cost, quality, and times. We are also in discussion with utilities on new ways of deploying fault passage indicator, such as gain share model or rental model so that more feeders are covered. SCADA is the next important area for us. The capability we have built through Patna project is allowing us to bid for more SCADA projects in other states. And there are certain tenders in our pipeline that we are working on. We expect SCADA to become a good part of our total business from here on. We are also in discussion with few companies for technical collaboration in SCADA. We expect this to come together between now and first half of next financial year. Now, the area where we are working the hardest is the cash flow. Our debtor days have come down from about 193 in March to 179 in June to about 150 in September. And we have collected about 50 crores since this, after closure of this quarter. Our focus is now to bring debtor days further down. Our wholly owned subsidiary Sugs Renewables will bid and hold RESCO projects, which will give us recurring revenue. In transmission and battery storage, we are building step-by-step. To close, our order book is spread across 10 states. Our products and SCADA business are gaining ground. And we are giving full attention to the cash flow. The Rs. 1,000 crores for financial year '28 remains the direction we are building towards. And we will keep you informed every quarter completely and on time. Thank you, and we are now happy to take your questions, please.
Moderator (Vasuvi Financial Advisory): Thank you very much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may enter star followed by one on their touch-tone telephones. If you wish to remove yourself from the question queue, you may enter star followed by two. Participants are requested to please use only handsets while asking a question. We will wait for a moment while the question queue assembles. The first question is from the line of Vaibhav Mishra from Finvestor Research. Please go ahead.
Vaibhav Mishra (Finvestor Research): Hello, sir. Congratulations for the very strong set of numbers. And sir, my question is regarding the margins. I think last quarter we had 15.3% margins, and we intended to maintain these margins at least, not go below these. But I think we clocked 14.1% this quarter. So, could you please share what is the reason despite we going into FPIs and products? So, what kind of margins we can expect for the next, I mean FY27, remaining of FY27 and FY28, sir?
Santosh Shah (Sugs Lloyd Ltd): Thank you, Vaibhav ji. Thank you for appreciation. Our this EBITDA for this H1 is 14.54. And I would like to explain you the nature of business. First of all, this deviation is not, it's very marginal. But what happens in our kind of projects, the project is bid on a, you know, for a period of 24 months or whatever is the completion time. And in that project, there are certain items which are at a higher margin and some items are at lower margin. And it depends exactly upon the availability of work front, availability of, you know, customer's permission, all those things, which material we are going to bid when. So, in any quarter, we may bid some, we may execute some portion which is having less margin. In other quarter, we may have billing of
Santosh Shah (Sugs Lloyd Ltd): those portions where the margins are higher. So, overall if you see the margin on a yearly basis at least if you see the margin will remain same. So, this is on quarter to quarter it may vary, but on a year basis if you say, it will remain almost on on the same lines.
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