ITD Cementation India Ltd
NSE:ITDCEM
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ITD Cementation India Ltd
Earnings Call Analysis
Q1-2025 Analysis
ITD Cementation India Ltd
The earnings call revealed that ITD Cementation achieved significant financial milestones in Q1 FY '25, reporting a record revenue of INR 2,381 crore. This represents a year-on-year growth of approximately 30%. Additionally, the company reported an EBITDA of INR 237 crore, reflecting a 36% increase compared to the same period last year. Notably, profit after tax reached INR 100 crore, a remarkable milestone that demonstrates nearly 100% growth year-on-year. This performance indicates the company's robust operational efficiency and the ability to capitalize on market opportunities.
The company highlighted major ongoing projects that substantially contribute to its revenue. The Ganga Expressway project is particularly noteworthy, with 50-55% completion and generating over INR 600 crore in revenue last quarter alone. Other projects, such as the Chennai Metro and various marine jobs, are progressing well. Although progress may slow due to seasonal factors like monsoons, management expects a resurgence in activities in October, maintaining a positive outlook for project completions.
Management expressed a strategic shift towards international markets to drive growth. ITD Cementation is targeting projects in regions such as East and West Africa, the Middle East, and neighboring countries like Sri Lanka and Maldives. The company aims to secure approximately INR 10,000 crore in international orders this year, with an emphasis on marine projects. This approach not only diversifies revenue streams but also potentially enhances profit margins due to favorable contract structures.
Looking ahead, the company anticipates maintaining a revenue growth rate of 15% to 25% over the next few years. They also expect the operating margin to stabilize around 10% to 11%, primarily within the domestic market. Management is optimistic about securing additional orders, projecting an order inflow of around INR 10,000 crores for the financial year, supported by a pipeline worth INR 35,000 crores to INR 45,000 crores in future bids, categorized primarily in marine and metro sectors.
Prasad Patwardhan, the CFO, reassured investors of the company's manageable debt levels, with a net-debt-to-equity ratio of approximately 0.3x. The company reported a gross debt of over INR 800 crore, but emphasizes that a significant portion of its mobilization advances is interest-free. This prudent financial management enhances ITD Cementation's stability, allowing for continued investment in growth opportunities without excessive leverage.
Management acknowledged challenges in the domestic job market, stating that while opportunities remain, the quality of available jobs is variable. There is increased competition for securing tenders, which emphasizes the need for efficient operations and cost management. Despite these challenges, ITD Cementation's established presence and expertise in areas like underground and marine work are advantageous. This balance of maintaining operational excellence while pursuing new opportunities positions the company favorably amid market dynamics.
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Ladies and gentlemen, good day, and welcome to ITD Cementation's Q1 FY '25 Earnings Conference Call hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Mohit from ICICI. Thank you, and over to you, sir.
Thank you, Sumit. Good afternoon. On behalf of ICICI Securities, I welcome you all to the Q1 FY '25 Earnings Call of ITD Cementation India Limited. Today, we have with us from the management Mr. Jayanta Basu, Managing Director; and Mr. Prasad Patwardhan, CFO; and Rahul from Investor Relations.
Without much delay, I'll hand over the call to management for the opening remarks, which is followed by Q&A. Thank you, and over to you, sir.
Thank you, Mohit. Good morning, everyone. This is Prasad Patwardhan. And I would like to thank you for joining us on this Q1 FY '25 earnings call. Before we begin the discussion, I would like to mention that during the call, there could be some forward-looking statements about ITD's business prospects and operations, which are subject to several risks and uncertainties and the actual performance could differ materially from whatever is stated during the call.
We declared our Q1 FY '25 results yesterday, and I'm sure you would have had a chance to go through the numbers. We reported an excellent set of numbers for this quarter, with the highest ever operating income of INR 2,381 crore. It represents a growth of about 30% on a year-on-year basis. Our EBITDA is coming at INR 237 crores, which is, again, represents a growth of about 36% on a year-on-year basis. And profit after tax, this is the first time when our quarterly profit has reached INR 100 crores, which is an achievement and a milestone in itself and represents a growth of nearly 100% on a year-on-year basis.
Our debt continues to be within controllable levels and the balance sheet is not at all leverage are net-debt-to-equity ratio is about 0.3x. That is as far as our operational -- our financial performance is concerned. I will now hand over to our MD, Mr. Jayanta Basu for his initial comments, and then we'll take your questions.
Thank you, Prasad, and good morning to all of you, and thank you for joining this con call Q1 FY '24/'25. Prasad has mentioned that we had a good set of numbers this quarter. Revenue has crossed INR 2,300 crores, close to INR 2,400 crores, which was few years back was wholly at turnover. We have achieved in one quarter. And EBITDA is around 10%, Profit after tax also close to 4.2%, which was 3.6% a year back. So there is improvement in all the parameters. And going forward, we hope that we'll be able to maintain the same tempo because there are not many good jobs in pipeline.
Before I explain about the new job prospect and the [ wholesale ] pipeline, let me tell you that there are a few jobs which are quite critical for us in terms of the value and price. First of all, Ganga Expressway, we have almost completed 50%, 55% of the job. And in last quarter, we could do more than INR 600 crore revenue from a single job in Ganga Expressway. We're going very well so far there is no problem. Now because of monsoon, the progress is looking limited, but from October, it will start. So I hope that with in that time we'll be able to complete this big growth project.
Chennai Metro, all the [indiscernible] are working. It is going well, development to underground, so harder completion. In terms of marine job, Udangudi, as you know, our signature project, is completed now. We have started the navy job in the East Coast of India, project Harsha, has started well. Another job in West Coast that is [indiscernible] is also on the verge of completion. And few other jobs all are going well.
Yes, we have -- in foreign job, [indiscernible] job in Colombo or West Container Terminal that are also going well. Bangladesh is little temporarily because of the latest issue -- but good thing about Bangladesh out of this problem is that we have hardly done anything there. In fact, we should start the job from October this year. So impact-wise, today, we have got nothing to declare because our mobilization is also not taken place, as we are sitting on the advance -- old ages in advance, all people are safe. And they have come back and we'll watch the situation how it goes and accordingly, we'll take our action.
Coming back to the future prospect. As we have said many times that our focus is now on the international market, and we are trying our best to get some more job in international market. In domestic also, we have got enough opportunity, some tenders have submitted, some are in pipeline. So going forward, work in hand plus work expected, I think we'll be able to maintain the same tempo what you see in the first quarter.
That is all in the brief, and we are open to any questions. We'll be happy to have questions. Thank you.
[Operator Instructions] The first question is from the line of Rishi Kothari from Pi Square Investments.
Congratulations on the good set of numbers. My first one primary question was on the Bangladesh project as we right now are, as you know, that is a political factor that is going on in the country. So -- and of course, or as you mentioned that we haven't started the prject yet. So in future, let's say, if at all, things become stable as it will start to the project. So what are the possibilities that project might hindered eventually because of the crisis again happening. So is there any provision that we have made for the project or not?
Well, what is going to happen, neither we know, neither you know because it is not in our control. We have to watch and see, as I mentioned that we have secured the advance, which is with us. We have hardly mobilized. We are just about to start some mobilization, which has been now action which is [indiscernible] now.
Provision in the sales, we have to see another few days, a few weeks how it goes. Our expenditures, hardly have done any expenditure in that project so far. So that is what I have to say now. I don't have much unless we know what is happening in future.
So what is the revenue exposure do we have on the company? Right now, the Maritime structure is roundabout INR 6,400 crores of exposure. So what's the percentage of that project Bangladesh carries?
Yes. For this year, total value of the project is around INR 1,500 crores, and it is expanding in the 3 year time, roughly 2.5 to 3 years. In this year, we might have considered around INR 300 crores to INR 400 crores for this quarter in this year, '24, '25.
Sorry, I did not get the number in the beginning. How much expenditure do we have?
Total value is INR 1,500 crores, which is [ expanding ] more than 2.5 years to 3 years time. And our estimate progress for this year will be around INR 400 crores, INR 500 crores around that.
Okay. Okay. And my second question is on the -- any updates on the [ parentco mistake ] that is being happened in the market for the company. So any updates on that front?
Update means you know that we have already informed the service that was there and we wants to dilute some states, as some process is going on at parent promoter level. So it is, I think, quite initial state, and we'll come to know once it happens after a few weeks or months.
Okay. Great. And in terms of the future growth prospects, what are the revenue growth expectations we have for 3, 4 years down the line. Any growth number targets?
Yes, I think we have maintained growth of 15% to 25% in that range going forward, [indiscernible].
Okay. And any margin expansion looking at operating level? Right now, we are running at about 10% to 11%?
So I think we have to be -- we have to live with these numbers, unless we have overseas market, in Indian market, I think that is okay. If we are able to do good, we'll be happy. But I think for the time being 10% should be the number you should consider.
So we'll maintain the range of 10% to 11% for at least a year or so?
Yes, that is the expectation.
The next question is from the line of Pratik Kothari from Unique Portfolio Managers.
First of all, hearty congratulations. I mean the way we have scaled over the last 3, 4 years, which was commendable. So my first question on -- I mean in the beginning of your commentary, you did say that the Indian jobs, there are not too many good jobs in domestic markets, if you can highlight and elaborate on that?
So, I have not said too many good job. I said overseas market, it's our focus because if you see, basically 2 years back, our presence was nil. We have started doing some overseas business, and we found that is a good area to work because -- the contracts are all equitable contract and margins are good. So that is the focus we have. That does not mean that domestic market is bad. Domestic market, we can get the volume and particularly the segment where we work in Marine and underground sector, that is always good.
So in terms of competition or availability of orders pipeline in domestic, it stays the same or [indiscernible]?
Yes, competition is there, and that is why I said that EBITDA, whatever is there now, it will be around that, don't expect much from there because we have to secure the job based on the market price.
In our annual report, we have mentioned that [indiscernible] says that we are committed to expanding our capabilities and exploring new avenues. So this is from a geographical perspective or even in terms of the kind of work we do, we are intending to venture out into Maritime?
See, basically, we strongly believe that to have better performance, you have to grow in organic manner because we have enough of learning cup of new segments. Now the time has come, we have to invest whatever we do good, it will be more. So it is geographically, increase the footprint, yes. That is the meaning of that.
And one for Basu sir, are interest expense -- earlier our expectations was you've shared about 3%, 3.5% of sales. And I think we have done a fantastic job in bringing this down. So are these numbers 2.2%, 2.4% of sales sustainable? Or is this something specific which is going on?
Well, I think, Prasad, you can address this.
No, it is nothing specific. These are operational efficiency that is kicking in. But as our volume of operations and grow and we get new orders, I think there is a possibility that the interest cost will could inch up a bit as a percentage of revenue.
Sir, anything specific now because the number is so low?
No, nothing specifical. As I said, we got in -- this typically happens in Q1 where we get a lot of payment from especially government clients in the month of March. And typically, we used that to reduce our debt and that impacts our interest costs, especially in Q1. And that is what we are seeing in this quarter.
Correct. And sir, last one, I mean, historically, we have seen the parent of our company changed multiple times. But in your experience, I mean, how do we stand? I mean whether -- I mean it's a matter of time or you don't even know if it's going to happen, but if they sell partially or completely, how does that change their organization or outlook or approach?
Well, it will be difficult to comment at this stage. But given what we have seen in the past, it doesn't impact our operations directly. We are not dependeing on funding from the parent or there are no guarantees that the parent has provided for us. So in terms of operation, we don't expect, as of now, any impact on our day-to-day operations of the company.
And in terms of technical confidence to -- I mean, now we are ready to -- we can go and apply to any projects on technical grounds?
Yes. Our present promoter has really helped us during their [indiscernible]. And now we know how to handle the tunnel boarding machine. We know how to do the airport and some of the areas. So now, today, you will see hardly any job we quote in the joint venture. So most of the jobs we are able to do stand-alone. And Marine, we never went to anybody, it is our own area. So we have been doing marine work for last 30 years or so.
So I think we are not set for PCM we don't require much of technical support. Technical support is always required, you see. That does not mean it has to come only from the promoter. We can go anywhere else -- technology as much is required. But [indiscernible] whatever support we have got from ITD so far, that is not required because we are able to [indiscernible] within ourselves.
The next question is from the line of Aditi from CD Research Private Limited. Aditi, please go ahead. As the line of Aditi seems to be disconnected, we will move to the next question. The next question is from the line of Nikhil from Kizuna Capital.
Hello, am I audible?
Yes.
Congratulations on great set of numbers. So sir, my first question is, like you have guided that you're going to grow 20% this year, next year. So sir, for the next year, for like FY '26 growth, we need to have an order intake of INR 12,000 crore to INR 15,000 crores approximately for that kind of growth with our current execution capabilities. So sir, how are we targeting that the order book inflow FY '26, -- like do you have any kind of plan post-'25?
Well, this execution rate has increased now. If you see the job what we are doing now at much faster speed than what used to do 2 years back. Just imagine Ganga Expressway INR 5,000 crore job will be completing in 2 years' time, which is 3, 4 years, 5 years in earlier days. So working hand also a function of at what city you are executing. In that way, we are doing much better than before. That is one aspect.
And second aspect is that so far in this year, already we have secured around INR 3,000 crores of work, correct?
We have secured the around INR 2,000 crore.
We have secured around INR 2,000 crores job -- we have secured. And INR 2,000 crores in [indiscernible], we are expecting [indiscernible] any day. So INR 4,000 crores by month of August. The remaining part, we are sure that we'll be able to add [indiscernible] [ 6,000 to INR 7,000 ] crores of jobs, so INR 10,000 crore, INR 11,000 crores would be okay.
And my second question is -- like I was going through the budget document. Just so the allocated budget for the Marinetime and metros is approximately INR 27,500 crores, and with the 20% success rate that we have, it will be close to INR 5,500 crores. So are we looking international projects for the marinetime for broader scope of growth? And sir, are we also planning to get into solar EPC business too?
No, no, no. We are not going to solar EPC, but for solar EPC, there is infrastructure required, if they require a deep [ hand ] foundation. [indiscernible] they are like today for the green energy, whatever work is being done by very upside performance. We are part of the civil structure construction. And your first question was that going to our seniors. I have said many times, we are targeting many overseas job and most of them are marine. So yes, we are there.
The next question is from the line of Prem Khurana from Anand Rathi Shares and Stock Brokers. Please go ahead.
Congratulations on a very strong set of numbers. Basu sir, I think, in your opening remarks, you spoke about the prospects that you see in India and overseas. Would it be possible for you to kind of quantify segment-wise how much prospects are you envisaging in India to bid for and how much would be overseas and what will be the mix, I mean, let's say, I mean if you want to have at least INR 10,000 crores of inflows in this year, how would the mix be between, let's say, overseas or in India? And even in terms of segments, I mean, if possible?
Okay. I'll try to answer your question in a more detailed manner. For the marine, the bid so far, we have completed around INR 3,000 crores, which is tender has been submitted. Out of that INR 1,200 crores from overseas. And the bid, which is on the pipeline that we are working and which will be submitted by another few months time, will be around INR 5,000 crores, the tender we are working.
And beyond that, the tender which has yet to come but we're not very sure that it will be there sometime during this year, will be another INR 20,000 crores. So INR 3,000 crores plus INR 5,000 crores plus INR 20,000 crores. So around that number we are working for marine. And part of this also oveseas job, which is to be submitted from marine.
And then if you come to the metro, I think all of you know that Patna Metro and Indore Metro put together around INR 8,000 crores job tender we are working. Beyond that also, there are many other jobs in Metro, their [ Hydel ] Power, like Pumped Storage and [indiscernible] like that will be around INR 5,000 crores to INR 6,000 crores, some of being on a tender. There are a few jobs of foundation and others. Altogether, around -- if you see the tender, we are working, tender, which is immediately coming and from future tenders, INR 35 000 crore to INR 45,000 crore jobs we can see in our horizon.
Sure, sir. And the breakup in terms of how much of this would be essentially domestic and how much would be international?
International, there is specifically, I can tell you, 1 plus -- around INR 10,000 crores. Marine and there is other job also in Middle East -- around INR 10,000 crores.
And sir how do we -- I mean, sir, as far as I know, I mean, overseas the project that you've been generally tend to be fixed price. And I mean, geopolitical, I mean, we seem to kind of volatile -- so would that mean -- you would -- there will be some extra contingency results whenever you bid projects outside India because I mean, essentially, these would be -- some of these are looking to be new for you, right? I mean, the Africa that you are that you're targeting -- would be somewhat new. So fair to assume, I'm at least to begin with whenever you bid and given the time frame some of these would be sort of fixed price -- you would try and target margin, which will be a little on the higher side compared to India?
Yes, of course, I have said. But the question what you have asked, that is our profession. As a business, we do all these [indiscernible] keeps getting provision on how much margin, which has to target, which are not to target. So those things, that is what we are doing now. So of course, we will target to have better margin, and that is our idea to go overseas.
And Prasad sir, possible to share in how much did we encourage CapEx in Q1 and how much more is envisaged for the balance of the year?
In Q1, CapEx was not a very high number. I think it was in the range of about INR 20 crores, INR 30 crores. This year, yes, we will be incurring some replacement CapEx and some purchase of new equipment as well, it should be in the range of INR 150 crores to INR 200 crores. It would be significantly lower, I believe, compared to the earlier bids. But that is the target we are working with right now.
The next question is from the line of Franklin Moraes from Equentis Wealth Advisory.
Sir, you mentioned that last 2 years, we have seen a significant ramp-up in execution. So I wanted to understand maybe internally, what's substance changes, we would have done to kind of affect this? And also from the environment perspective, what has really helped us in achieving this?
We have been doing well for many years. Only thing few one-off job was dragging us down. Otherwise, if you see the execution of other jobs, it is not -- today or yesterday that we have started doing well. Basically, we're doing well. Our operations team is quite efficient. And most important part is the people team, which works for us, they are working with us for many years, they continue to stay. So those are the factors and we emphasize on putting right people at right locations. So that is also helping us to do better work.
Yes. And sir, in terms of your gross debt equity ratio, any -- currently at 0.6, any guidance which you would like to give?
It's difficult to give a guidance, frankly, because the [indiscernible] a function of our scale of operations and the new orders that we secured. So our endeavor is to have a new balance sheet and not -- net the debt value being significantly. And that is what we keep on working on, but difficult to give a target for the index numbers.
The next question is from the line of Pratik Bandari from Art Ventures. Please go ahead. As the line of Pratik seems to be disconnected. The next question is from the line of Nidhi Shah from ICICI Securities.
Congratulations on a great quarter. I just had a couple of questions on say the overall bid pattern, you mentioned about a lot of the different segments, metro and marine. But what are we looking at overall, what are the projects that we have already bid for? What are the projects that should be possibly coming up in the future? And then given the scenario, what would be your possible orders in for guidance for the year?
Sorry, I did not heard you properly. If you repeat the question, please.
Nidhi, there is a lot of background noise. Is it possible for you to keep it out and maybe repeat the question a bit?
Is it better now?
Yes, it is better now. Please go ahead. Please speak loudly as well.
Yes, apologies. So again, on the bid pipeline, I wanted to know what were the orders that we have -- what are the projects that we have already bid for in this year and we are looking forward to the announcement of that? And what do you see in the near future bid pipeline, some of the bid projects that could come up in this year?
Bid, we have submitted Marine -- we have submitted 2, 3, 4, 4 tenders and 2 of them is domestic, 1 for the JSW, 1 for [ A.P. Mollers ] at Gujarat and another job we have submitted in Middle East for some clients, I don't want to reveal the name. And there are some tenders which are working one for the [ D.P. Work ] at Gujarat. Then 1 job at [indiscernible], which we are already working at in some of that, 1 marine job in [indiscernible]. So these are the kind of jobs we have submitted under commission for the marine and for metro [indiscernible] Patna Metro, Indore Metro or everybody is working there. So these are the few jobs we have submitted so far.
Okay. After Marine and Metro, were there any other jobs that have been bid for in this quarter?
One job, as I mentioned, that commercial or residential building for [indiscernible] around INR 1,900 crores, INR 2,000 crores job.
Okay. And do you see any orders coming up in the highways, bridges and flyover segment?
No, we are not pursuing any job for highways.
Okay. And in the coming year, do you wish to participate in any other bids in this segment?
We don't have such plan now as of.
Okay. Okay. And lastly, my question would be on the TBM. So I'm able to gather, I might be wrong on this, but that the broadway has, that the TBM has entirely depreciated during one project. So my question would be on the accounting front. How do you depreciate your TBM do you -- you depreciate it over the duration of the project? Or then do you hold it in your book for say 5 or 10 years? So what is the policy that you use?
This is typically our business secret. How do you expect me to reveal all these because everybody knows what is the cost of TBM and if I that how much we depreciate in this project, everybody will know how much I have charged. So let it be within us.
So I just wanted to know the policy. Do you do it over a couple of years or do you would appreciate in your books of accounts over the project?
We -- it depends again. I mean we don't have a policy which is very rigid. The flexible policy based on the bid we are submitting, based on the market, based on our working and we change our policies.
The next question is from the line of Pratik Bandari from Art Ventures.
Am I audible?
Yes, go ahead.
Yes. So I just wanted to understand as to where are we anticipating the order book for the year by the year-end? And what would be the order inflow for the complete year?
As I mentioned that INR 4,000 crores is already there. I mean they're waiting for LOI. Balance added to INR 7,000 crores should come, some marine, some underground metro and some building jobs.
So by year end, we see the order inflow to be around INR 14,000, INR 15,000?
INR 10,000 crores, INR 10,000 plus.
Order inflow?
Yes for the whole year.
And where do we see the order book going by the year-end?
Well, it will be...
That would be a function of the orders secured in the execution during the year. We have already given you in the past result we have indicated what sort of growth number we are looking at this year and next year. It is on the order inflow and the order book that we had at the period. I am sure you can work out as what the order book is likely to be at the end of year.
The next question is from the line of Vipul Shah from JM Financial.
Sir, what would be the current debt levels?
Gross debt is about INR 800-plus crores and the net debt level is much lower than that, net debt is under INR 500 crores.
Okay. Sir, what could be the value of mobilization advances?
Mobilization advances is of balance sheet as of June is about INR 1,300 crores.
And out of INR 1,300 crore, what would be the interest-bearing and interest rate on that?
Well, I don't have the split right now, but there is a significant portion of it which is interest free and the rest in interest, I would say, around 25% is likely to be interest-bearing, the rest is interest free.
So 75% is interest free?
Yes.
And what would be the interest rate on the interest-bearing mobilization advances?
So it varies from project to project, but largely, it is market driven. It will be lean to either some bank [ NCLR ] or something like that. So it's market-driven.
So it could be somewhere around 9% to 10% range?
8% to 10% or maybe there could be one-off projects where the rate could be even slightly higher than that.
Okay. And sir, one confirmation, our YTD order inflow is around INR 2,300 crores and we have L1 is in around about INR 2,000 crores, right?
That's right. YTD order inflow is about -- it's around INR 2,000 crores. And then L1 is around INR 2,000 crores.
The next question is from the line of Vishal Periwal from Antique Stock Broking.
Just a couple of clarification. The private side order book it is 35%. So primarily it is coming from which segment for us?
Primarily, that is coming from the growth in highway which is Ganga Expressway.
Ganga Expressway, that is from Adani Group. Then we have got few jobs from [indiscernible] mittal and some more jobs from Adani, Marine and...
Okay. Okay. Got it. And then -- I think I just missed that number. The international order book is what percentage of our total?
[indiscernible] around 7% or [indiscernible].
Sorry -- it is at 7%?
7%, that's correct.
The next question is from the line of Ashwani Sharma from Emkay Global Financial Services.
Sir, I'm a little new to the company. I just wanted to understand that if you could speak about our core competencies in each of our segments that will help, sir.
We work in 5 verticals and 5 vertical covers around 10, 12 segments, and some of them are very good in like marine, that is Maritime, ports, harbor, construction of jetties, breakwaters, split ways, like that like that sea featuring facilities. Then underground metro, like in various cities we are doing using tunnel boring machine.
We are also good in tunnel, normal tunnel, we call it NAPL by dealing and investing report for roads and railways. We do a lot of building work, either commercial or residential, including airport terminals, that is also a core of contingency. We are good in railways, road bridges, highways, though our presence in highways are not much, but we are quite good in that. And our core business, which we have started with that is our specialized foundation job. We call it Diaphragm Wall Piling. So those are the area we work and some jobs in ideal, waters. So that's all.
Okay. And sir, in the domestic market, typically, what is our win ratio across the segments?
It varies, I think, around 18% to 20% is ours.
Okay. And lastly, sir, when you say opportunities in the overseas market, if you could give us which are geographies where you see this opportunity that you discussed is that you see -- if you could talk about the name of the geographies?
Mostly neighboring countries like Sri Lanka, Maldives, even Bangladesh, though Bangladesh has problem now, but there are opportunities as well. And then East Africa, West Africa and Middle East.
The next question is from the line of Nikhil Abhyankar from ICICI Securities.
I just wanted to understand our decision as to why not to pay for road -- as per road projects. And just a follow-up on that. A lot of road projects have been approved recently. That is quite a huge opportunity. So will we be looking to do the EPC part of these road projects?
Yes. I don't say that we will not go for road projects. We have to have a proper assessment of the project because normally what happens whenever we have lengthy project either metro or road, normally in our country, it is very difficult to get the front available within the time. And if we don't have the front, we have got all the resources mobilized to keep idle and you incur additional cost. So those are the issues. And #1.
#2, road project involves a lot of local material to be sourced like [ hut ], which is a big problem because none of the customer or client is ready to supply by themselves, the [indiscernible] unless we have a local player, it is very difficult to arrange. So that's why those uncertainties are there. So we have to be very careful, if it is good, we'll target some road projects.
Sir, since we are already executing a EPC part of the BOT project in UP. There are a few road projects available in UP -- coming up in UP as well. So will you be looking to participate in that in the EPC portion of it?
Yes, why not. As I told you that parameters, what I have just mentioned, if we can fulfill and if we are satisfied, yes, we'll count.
The next question is from the line of Sunil Kothari, an Individual Investor.
Congratulations, Basu sir, Mr. Prasad, for such a wonderful job you are doing. Sir, my question to Mr. Basu, during the last 25, 30 years, you're seeing parent -- almost 3, 4 parents changing, the way you navigated this company up to this level. You have seen so many challenges of economy and parent side, some domestic demand, so interesting challenges and domestic challenges also.
My question is, sir, now again, your parent is going to be changed. I'd just like to take your view. What will be your preference? It will be -- it should be some domestic, overseas or international also doesn't make any difference?
And second is, in terms of technical capability, what your preference will be for new parents? And in terms of financial strength, does it make any major difference if they're very financially strong owner, not possibly really helpful because you have faced so many parents, and you are so strong now.
So I think you have rightly said, we have quite experienced in this particular aspect. We are strong now. So whoever comes we'll be able to manage. I may have many preferences, but there's no point there saying that because whatever is going to happen will happen. So that doesn't mean that we'll not be able to perform. We look after only for this company, our performance. We'll keep on doing that. And one thing for sure, whoever comes as a parent, they'll definitely have interest to grow this company. Otherwise, why they will buy it. So [indiscernible] whoever comes, I think we'll be able to do whatever we are doing now.
So in terms of technical capabilities, we don't see any major requirements. We are capable ourselves?
Technically, I will never say that we are 100% okay because every time technical things are changing. Today, we never respected high-speed rail in our country, whether they have expected many other things which is happening now. We have to keep on improving ourselves but that does not require to have to parent to support us. It can be done by many other ways.
Sir, last question we are hearing a lot from many the project taker like say, [ Bell ] or maybe [ Tarmac ], so many companies, they are talking about not taking any EPC project. They want to just supply product? And in your -- one of remarks, you say if there is a technical critical job for solar project also, we are ready to take. Do you see this opportunity opening up more because many times now, people want to avoid the civil and construction related combined project. So what's your thought?
You are talking about the [indiscernible] job, is it?
Yes, sir. Yes, sir.
Yes, that is what we have started doing. I think a few of the jobs which have done recently, one is budding example in Udangudi, where we have done the foundation, we have done the [indiscernible], we have done the conveyors, we have brought the cranes, we have commissioned them electrical whatnot. The whole package was delivered by us. Same thing we're doing at projects [indiscernible] and that is one area which we are really furious and we have got our team to handle such jobs. Yes, we'll be happy to do such jobs.
Just one more is power -- thermal power projects which government is planning to do during the next 5, 6 years is almost comparable to the last 15 years capacity addition. Do we see any opportunity for us [indiscernible] or civil related?
The thermal power project, if you ask me, it is a job, which can be done by many companies. It is pure civil work. So unless something very challenging, where you'll find the competition are less, we will be interested. Otherwise, we have to assess what is the job really.
The next question is from the line of Jiten Rushi from Axis Capital.
Congratulations on a good set of number. My question is on the advance portfolio you've seen that approval has come from [indiscernible]. So when can you expect the volume to pick in and what kind of opportunity size is for actually building this port?
Yes, [ Vrindavan ] port would be a big opportunity for people like us, who was in a marine job. The big port were coming up. So somehow rather ] something will be there for all of us. So I'll not be able to say where it is coming because depends up on the -- but basically, I think the [ ball ] has started rolling the first package, which has come now it is on the BOT basis, that is aging part and the commission part. And hopefully, the soon other packages will come, I think it's a matter of one or 2 quarters in the tender income.
So trading will not -- we will not be doing the trading because we will not be able to expert in that [indiscernible] what I understand right.
Yes, yes. I think we can help the company will get the job, if they require, but directly, we don't participate or such as.
Sir, in this INR 76,000 crores, INR 80,000 crores that is increasing would be what INR 10,000 crores to INR 15,000 crores or it will be more?
It's a big total value of this [indiscernible] INR 70,000 crores, and raising itself will be around INR 15,000 crores. And then recorder will be another INR 10,000 crores in that rate, big numbers.
So you can be eligible for broadly around INR 15,000 crores, INR 16,000 crores of orders if we are participating except for [indiscernible].
Yes, yes. It depends upon how the tender may sell, in some cases, we don't know really. So our total number is like that.
The next question is from the line of Vipul Kumar Shah from Sumangal Investment.
Congratulations for a very good set of numbers. So my question is, sir, we had several JVs with our parent company, and we were executing several projects through those JVs where the equity participation was different for different projects. And basically, all those JVs were due to technical expertise or due to financial strength of the parent. So now with parent company gone, will we be -- will we not be able to compete in these type of projects. So what are your thoughts?
Yes. I'll clarify. The last JV we have quoted in the parent company was in the year, I think -- no, no before that, almost 10, 19 years back. So today, only 1 or 2 JVs are running, which is running this job is almost completed the final bill is going on. Thereafter, whatever job we have submitted or is secured, similarly 7 job bigger than that have done stand-alone. So we don't really require their support for us to qualify for a job anymore.
Technically and financially, you can build on your own, sir?
Yes, yes. Very much.
And sir, lastly, is there any clarity whether parent wants to divest and entire stake or only partial stake?
I really don't know. I have to ask parent. Hopefully, they'll believe me, or they will not believe me, I really don't know.
That was the last question. I would now like to hand the conference over to Mr. Prasad Patwardhan for closing comments.
Thank you, everyone, for joining us on this Q1 FY '25 earnings call. We look forward to your continued support in the months and years to come. Thank you, once again.
On behalf of ICICI Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.