Olectra Greentech Ltd
NSE:OLECTRA
| US |
|
Johnson & Johnson
NYSE:JNJ
|
Pharmaceuticals
|
| US |
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
Financial Services
|
| US |
|
Bank of America Corp
NYSE:BAC
|
Banking
|
| US |
|
Mastercard Inc
NYSE:MA
|
Technology
|
| US |
|
UnitedHealth Group Inc
NYSE:UNH
|
Health Care
|
| US |
|
Exxon Mobil Corp
NYSE:XOM
|
Energy
|
| US |
|
Pfizer Inc
NYSE:PFE
|
Pharmaceuticals
|
| US |
|
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
| US |
|
Nike Inc
NYSE:NKE
|
Textiles, Apparel & Luxury Goods
|
| US |
|
Visa Inc
NYSE:V
|
Technology
|
| CN |
|
Alibaba Group Holding Ltd
NYSE:BABA
|
Retail
|
| US |
|
3M Co
NYSE:MMM
|
Industrial Conglomerates
|
| US |
|
JPMorgan Chase & Co
NYSE:JPM
|
Banking
|
| US |
|
Coca-Cola Co
NYSE:KO
|
Beverages
|
| US |
|
Walmart Inc
NYSE:WMT
|
Retail
|
| US |
|
Verizon Communications Inc
NYSE:VZ
|
Telecommunication
|
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
1 192.4
2 135.1
|
| Price Target |
|
We'll email you a reminder when the closing price reaches INR.
Choose the stock you wish to monitor with a price alert.
|
|
Johnson & Johnson
NYSE:JNJ
|
US |
|
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
US |
|
|
Bank of America Corp
NYSE:BAC
|
US |
|
|
Mastercard Inc
NYSE:MA
|
US |
|
|
UnitedHealth Group Inc
NYSE:UNH
|
US |
|
|
Exxon Mobil Corp
NYSE:XOM
|
US |
|
|
Pfizer Inc
NYSE:PFE
|
US |
|
|
Palantir Technologies Inc
NYSE:PLTR
|
US |
|
|
Nike Inc
NYSE:NKE
|
US |
|
|
Visa Inc
NYSE:V
|
US |
|
|
Alibaba Group Holding Ltd
NYSE:BABA
|
CN |
|
|
3M Co
NYSE:MMM
|
US |
|
|
JPMorgan Chase & Co
NYSE:JPM
|
US |
|
|
Coca-Cola Co
NYSE:KO
|
US |
|
|
Walmart Inc
NYSE:WMT
|
US |
|
|
Verizon Communications Inc
NYSE:VZ
|
US |
This alert will be permanently deleted.
Olectra Greentech Ltd
Earnings Call Analysis
Q3-2024 Analysis
Olectra Greentech Ltd
Olectra Greentech has shown a strong performance and continued growth trajectory in Q3 FY'24, with the delivery of 1,564 electric buses and 51 electric tippers as of December 31, 2023. Demonstrating commitment to enhancing capacity and technology, the company is experiencing strong demand, reflected in a net order book of 8,088 electric buses after delivering 376 in 9 months.
Financially, Olectra's consolidated EBITDA for Q3 FY'24 saw a substantial 52% increase year-over-year, reaching INR 56.10 crores, with PBT surging 65% to INR 33.84 crores and PAT jumping 77% to INR 27.11 crores. Stand-alone figures followed suit, signifying the company's sound financial health. The revenue growth was robust in both its Electric Vehicle and Insulator segments, with a 34% and 32% increase respectively.
The introduction of battery norms has significant impact, leading to a revised sales guidance. Despite a shortfall in Q1, subsequent quarters showed marked improvement, suggesting stabilization and continued improvement in the coming year. The company remains optimistic about not facing major challenges ahead.
Looking forward, Olectra plans to deliver a minimum of 2,500 buses next year, with another order of 5,150 buses scheduled across the next two financial years. The company also actively engages in tender opportunities such as the PM-eBus Sewa, an initiative by the Government of India for mobility, indicating potential future growth avenues.
You don't have any saved screeners yet
Ladies and gentlemen, good day, and welcome to the Q3 FY '24 Earnings Conference Call of Olectra Greentech hosted by Axis Capital Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Amar Kant Gaur from Axis Capital. Thank you, and over to you, Mr. Gaur.
Thank you, Muskan. Good evening, everyone. On behalf of Axis Capital, I welcome you to the Q3 FY '24 Post Results Conference Call of Olectra Greentech. From the management team, we have with us Mr. B. Sharat Chandra, CFO; Mr. P. Hanuman Prasad, Company Secretary and Compliance Officer. I'll now hand over the call to Mr. Sharat Chandra for his opening remarks, post which we can have Q&A. Over to you, Mr. Sharat Chandra.
Thank you, Amar. Good afternoon, everyone. We are taking as read the presentation, which is put on our website, along with the safe harbor statement thereon. Thank you all the investors for joining in the earnings call for the financial year 2024 Q3 and 9-month results today. We are very pleased to inform our stakeholders that we continue to report a strong set of results for the quarter and 9 months period ended 31st December 2023, both in terms of top line and profitability on a consolidated basis as well as on a stand-alone basis.
We have delivered 1,564 electric buses and 51 electric tippers till 31st December 2023. Thanks to our team's dedication and strategic initiatives and the key indicators, which in quarter 2 have signaled a positive trend, which has since accelerated in quarter 3, and we remain positive for quarter 4. Strong demand continues with the company's net order book of electric buses stands at 8,088 numbers after delivering 376 electric buses in 9 months. Our focus continues on increasing our manufacturing capacity and enhancing our technology capabilities. The construction work of the new state-of-the-art plant at Seetharampur is in full swing. And pilot production from the facility will be initiated from the 2nd of February, which is just 2 days away.
Now I will begin with providing you key highlights for quarter 3 consolidated financials. The company's EBITDA for quarter 3 financial year '24, which is an impressive INR 56.10 crores, marking a substantial 52% increase compared to previous year. The PBT has surged to INR 33.84 crores remarkable 65% increase over the previous fiscal year of INR 20.46 crores. PAT for quarter 3 stood at INR 27.11 crores compared to INR 15.3 crores with a jump of 77%. On a stand-alone basis, the company's EBITDA in quarter 3 reached an impressive INR 49.84 crores, marking a substantial 56% increase compared to the previous year. The PBT has surged INR 29.92 crores, a remarkable 73% increase from previous year fiscal of INR 17.3 crores. The PAT stands at INR 22.28 crores compared to INR 12.98 crores with a jump of 72%.
So quarterly -- the quarter P&L highlights are as follows: Revenue for Electric Vehicle segment grown by 34% and Insulator segment grown by 32%. We have -- both the segments have shown good growth in operating margins due to the design optimization and export sales in insulator segment and revenue mix in E-Bus segment. We have -- coming to the 9 months results, the revenue for 9 months on a consolidated basis was about INR 865.33 crores, up by 21%.
The company's EBITDA in 9 months eased an impressive INR 142.67 crores, marking a substantial 40% increase compared to previous year. PBT for 9 months stood at INR 85.67 crores, vis-a-vis INR 54.38 crores, a remarkable 58% jump. PAT for the 9-month consolidated basis stands at INR 63.76 crores, up by 62% compared to previous fiscal year INR 39.4 crores. On a stand-alone basis, the revenue for 9 months was INR 835.84 crores, up by 9% from INR 766 crores of previous fiscal. The company's EBITDA reached an impressive INR 132.64 crores, marking a substantial 33% jump versus previous year of INR 99.81 crores. PAT for 9 months on a stand-alone basis stood at INR 61.96 crores compared to previous year fiscal of INR 42.9 crores, up by 44%. Thank you all, and over to Axis for Q&A.
[Operator Instructions] The first question is from the line of Rishabh Agnihotri, an Individual Investor.
Congratulations on great set of numbers. I just wanted to quickly understand, I mean, we all saw the CMD interview on CNBC. The guidance was revised to like 700, 800 buses while it was 1,000 in the last quarter. And the reason quoted was the battery norm side. And I think you were very clearly out of the words the last time we spoke on the con call. So what happened here? And I mean should we expect similar things because the guidance of 2,500 has been given to next year. Just wanted to get a sense what happened like that we -- from 1,000 to 750 in terms of guidance in FY '24.
Yes. So as you rightly said, our target was 1,000 to 1,200 buses and trucks together earlier. But as you are aware, I think we have discussed in the past earnings call, the battery norms which were introduced and was of mandatory for delivering and selling the buses has impacted significantly. We have mentioned that in the earlier. And we have also mentioned that we are striving to make up the shortfall of quarter 1. Nevertheless, we are now -- we have seen, as we committed ourselves earlier, quarter 2 -- H2 will be better than H1. Accordingly, we are seeing quarter 3 numbers.
We have seen a definitely improvement over quarter 1 and quarter 2. We are definitely not facing or not foreseeing any challenge in the next year. The things are more or less stabilized now. And because of the overlapping effect, the sales guidance has come down. But overall, if you see, we have been performing quarter-on-quarter for the last 8 quarters improvement, except for quarter 1 of current year.
Yes. For sure, I agree, I mean, from a competitive perspective as well our margins are much better, ROCE is better, debt is better. So great things there. Just 2 more questions here. One, like the MSRTC order, which is of the 5,000 buses, right? Considering 2,500 next year, I hope -- I mean, there's no wait there because we have to deliver in the next 2 years, right? That's one. And second, any comments on the new PM-eBus Sewa order, I know the target guidelines have been extended [Indiscernible], but any window to us there that how would that tender look like?
Coming to MSRTC order, as you rightly said 5,150 numbers, we are going to -- planning to deliver in next 2 financial years. Next year, we are targeting minimum 2,500 numbers. And the balance we are trying to complete in financial year '25, '26. So as far as the PM -- the question was with regard to PM e Sewa (sic) [PM-eBus Sewa] it is in the initial stage, so we are expecting that to conclude in the next few months.
You have submitted a bid? Because last time I think you didn't right?
It's in basically -- not much progress there. The PM e Sewa (sic) [PM-eBus Sewa] the tender is basically the government of India's commitment towards the mobility, which will be beneficial for all the players in the market. Still, it is in the financial evaluations in the tender stage. In the coming months, we are expecting the tender to be submitted, and we are definitely anticipating good orders in this...
Have you not yet submitted bid now? I mean, are you saying that we'll not submit a bid this time?
No, no. Let me clarify this. This PM Sewa tender is [Indiscernible] tender. So only announcement came, the tender is -- the bid is yet to be submitted.
The next question is from the line of Sidharth Agarwal from Systematix.
Very happy with your results. Sir, just a few questions. Sir, in Q3, how many buses did we deliver? And tipper also?
Yes, we have delivered about 162 buses in Q3.
162 buses and 16 tippers.
How many tippers?
16 tippers.
And what's the target to support since the situation is improving in terms of battery testing on.
Yes, quarter 4 will be better than quarter 3. That is what we are targeting. And we are striving to basically meet the target definitely what we have recently mentioned in the CNBC interview, we are striving to deliver that target. We could achieve anywhere between -- we are targeting about 650 overall for the year.
So around 270-odd, you can look at that?
That is what we are looking. We are striving to do that number.
Okay. And tippers? Tippers we don't have any issue, right?
Altogether -- tippers, till date, we have delivered about 51 tippers. The response has been very good. But as we mentioned earlier, the traction is yet to happen. It is expected to happen in the next few quarters. And a lot of inquiries are happening. We are doing demos in their customer project sites. And about 25 electric tippers are in the final stage of discussions and finalization. So this will definitely come up in the next financial year.
And what's the selling price of one tipper?
It's about -- again, it depends on, again, the specifications of the customer. So it is about average about INR 1.3 crores to INR 1.4 crores.
Okay. And no subsidy over here, right?
Basically private purchases, private sales.
And how much it captures to our group company and how much is externally party?
As of now, we have sold all the 51 to the group company because as you are aware, MEIL, which is a very large -- second largest infra company, they procure for their own internal consumption tippers. The initial orders, it's a good ground for us to do the trial and demos, and they have been very successful. Now private inquiries are coming up, and we are showing the demos. We expect the traction to happen in the next 2 to 3 quarters.
Okay. So Megha would be requiring how many tippers in a year because second largest infra company of the country, that demands in tremendous, and how much capacity of tippers do we have?
There is -- there are not any constraint as far as capacity is concerned, the traction should happen. And we are coming up with a new plant as we have mentioned in the introductory remarks, we are doing the trial production, pilot production from day after tomorrow in the new plant. And post that, we are going to start commence in the next financial year. So we are not facing any constraints with regard to capacity.
Okay. And that capacity is fungible between buses and tippers?
Yes, yes, correct.
Sir, second point is how is the funding being done of this plant? And what's the total cost of the plant since you're starting pilot means everything will be capitalized out, right?
Yes, yes. See, basically, we have about INR 750 crores as the total project cost. So we are now do the funding from internal accruals and debt. Debt is in the advance stage of sanctions by commercial banks. We expect the sanctions to happen in the next 2 to 3 weeks. Once that is happening, we are going to draw down the debt. The debt is in the region of [INR 500 crores].
So till now who's paying for it, our internal accrual?
Yes, correct.
So till now, how much have we spent, sir, approximately?
Approximately about INR 100 crores we have spent.
Okay. Okay. That's our internal accrual.
Yes. Yes.
Okay. Sir, last question. We talk about FAME II or if FAME III comes, so what's your expectation of FAME III with the subsidy because we get so many articles, all some in favor, some against, you would be also be knowing. So what are we expecting from FAME III? Is the subsidy for us going to be increased or everything going to be taken away?
See, basically, I think we have to wait for tomorrow's interim budget speech from the finance minister. But definitely, the Government of India is supporting. They are very, very bullish. And in the recent past, you must have seen the announcement about 8 lakh buses getting converted. So all these are very, very positive. So the intent is basically to make the e-buses adoption in a big way. So not only e-buses, electric vehicles, but e-buses being the largest in terms of about 2 million buses are operating on Indian roads, so these conversions, it will be definitely incentivized -- the government will try to incentivize the OEMs, the operators and the end customers.
And sir, what are the last 2 orders that you've received?
The last order we received from Vasai-Virar, about 40 buses. And one private order apart from that. Before that, as we have discussed 5,150 with MSRTC which is the largest in the country.
Yes. So private order of how many buses and from which companies is it? Is it like a tour operator?
No. Basically, you see the private inquiries keep coming in. So basically, it's not the tour operator. So almost 40 buses is what -- one bus is a very small number; 40 buses is what the largest in this year, like last order was 40 buses. And now actually, I think we have mentioned earlier, BEST still under negotiation. So it's about 3,000 buses, we are L1. And PMC, 300 buses also we are L1, both these tenders are under negotiation.
BEST 3,000 L1 and PMC, Puna 300 L1?
Pun, yes, 300 L1.
What's the status of the previous order, which had gone to high court and everything? What does -- are we delivering anything over there or we have stopped totally?
No, no, no, 2,100 buses; Supreme Court has given the order in our favor and we started delivering. We have delivered about more than 100 buses still now.
All in Bombay?
All?
All in...
All in Bombay. Correct. Correct. Yes, you're right.
And there's no risk in those orders?
There is?
Because if I remember or you may correct me since you're the expert, the Supreme Court had said that you can give, but it is at your own risk.
No, no, no. All those things are old. That's the old matter. Now everything is done in our favor. So I think this has come up in the last quarter itself. And our company secretary, legal compliance officer will give you a highlight of that.
So you are referring to interim order initially, which we got. Finally, the case has been disposed in our favor, and we started delivering.
[Operator Instructions] The next question is from the line of [Indiscernible].
Am I audible?
Yes.
Congratulations first of all, an excellent Q3 numbers and very encouraging to know that the pilot for the new greenfield facility will come in 2 days. It's an excellent news. So my question is to understand the preparedness of setting up sales channels with respect to standout products of Olectra in the market. I'm talking about 2 specific products. One is the Electric CX2 Coach Bus and the second is legendary electric tipper truck which is the first [Indiscernible] tipper truck which is homologated India. So in order that we prepare for the incoming huge orders from private entities, we do have good visibility of products.
What we've seen recently is BYD passenger vehicles are tied up with Landmark Motors which is a listed entity for sales and service of BYD passenger vehicle cars for the showroom in Mumbai and few other places. Also, Ashok Leyland has tie up with Landmark Motors. So my question is, are we looking for similar tie-ups with reputed channel partners for sales in private segments? And yes, that's my question.
Yes, that's a good question. See, as far as the BYD thing what you are referring to relates to retail, passenger vehicle. So obviously, for passenger vehicle you need to showcase clearly with display and all. As far as we are concerned, so we have large orders of about 8,100 buses, which have to be delivered in the next 2 years. So right now, we are focusing on that. Of course, we have been doing a lot of demos and then we are getting private inquiries and private sales we have done about almost 20 numbers in the recent past. So -- and in the new facility, where we are building state-of-the-art new plant, we are going to showcase a separate display of our all products.
And the other aspect is, as far as we are concerned, the model is ECC, I think you are aware. So all the buses we deliver to, respect to STU and these are parked in the respective depots in various states, and our service personnel are placed in the depot to take care of the service activities. So that way, we are geared up for any kind of after sales service. So being STU driven now currently, so the retail side thing we will focus in future. As of now, we are focusing on delivering STU orders.
That's great to know. My second question, sir, to you is, as we understand, Fresh Bus has partnered with Olectra for their private electric bus segment. So are we expecting any new orders from Fresh Bus then?
Yes. Definitely, the initial order has been encouraging. They have been doing well. We expect new inquiries coming from not only Fresh Bus, some of the private parties also.
And the next question is from the line of Sidharth, an individual.
Am I audible?
Yes. Mr. Sidharth, you are audible.
My first question is regarding the realization per bus. So if -- like you mentioned that we have sold 376 buses this -- in the 9 months. So if I just [audio gap] average selling price because earlier, like in the previous call, you had mentioned that we sell somewhere around 1.4 [audio gap].
So I think your voice was -- we lost the part of the question.
So what is that price for us?
No, no. I think we are -- I'm not -- we could not hear your question because it was -- we lost your question for a bit. Can you repeat your question, please?
The next question is from the line of Rishab Agnihotri, an individual investor.
Just one quick question on the 3,000 order. The negotiations have been going since like 4 months, right? Now I mean, I think you've been speaking about it since last 2 quarters. Hope -- are you going to sort of get what's the problem? Are you considering like all of our tenders have been sort of coming through from a similar MSRTC and BEST. So can you just throw some highlights on that what's the challenge which has come there?
Obviously, state of Maharashtra is in the forefront in the country. The adoption of e-buses in taking the shape in a very, very good manner. So obviously, BEST is a very large entity, they have about 4,500 fleet, which they want to convert into e-buses. So the financial negotiations are in progress. It is taking more time, but we expect to conclude in the next few weeks.
[Operator Instructions] The next question is from the line of Anil, an individual investor.
On 2nd January this year, we got a very good news from the government of India that they are looking to launch almost 8 lakh buses across India. So we are seeing such kind of optimistic environment around the EV industry, but then why we are, of course, having a pessimistic approach of revamping the capacity of the company. If you look at 8 lakh buses in 6 years to be delivered and we want to be top 5 player, we should be contributing 20% of the industry. And if you see from that perspective, we should be having 30,000, 40,000 buses delivery capacity per year. Last 4 years, we are struggling to bring the capacity from 1,000 buses a year to 10,000 buses a year. Can you please tell me why you are so pessimistic, why you are not so -- you have to be optimistic.
Anil, to clarify, basically any industry it takes time. So as far as the EV segment is concerned, still, we are in the nascent stage. Only about [indiscernible] buses have been delivered or deployed in India. Of course, the government of India has been very, very supportive and been coming up with various initiatives to accelerate the adoption. For your kind information, none of the OEMs in the country has got capacity, they have to build capacities to -- at the same front, we have taken the initiative. We are building up the capacity from -- to start with the 5,000 numbers and in the second phase, which could happen very quickly to 10,000 numbers. Based on the demand, definitely, we would invest into the CapEx.
See, our philosophy has been always to get orders and then invest into CapEx rather than investing into CapEx and then waiting for the orders. If you see historically, that is our philosophy. And definitely, if such kind of numbers are coming up, our management is definitely geared up to increase the capacity.
Yes. So my question is that only because I also understood that it is a story of something somebody is waiting for the patients to first come and then after that, he starts studying the medicine, which is not so practical as far as the new industry is concerned. But why don't you think that instead of going so much conservative, I know that you are coming from an infrastructure success background, maybe applicable there, but in an industry which is driven by technology, and such a huge surge in demand in a short period of time, you should think that balancing it out and come up with an optimistic policy then rather than a pessimistic policy.
Definitely, we are optimistic, noted your point. So please see our performance over the past 8 quarters. So we have been progressing. We are not definitely -- we are progressing. We want to progress more from now, and we are building up the facility, and the pilot production is happening in 2 days from now. And in the new facility, we want to do a minimum of 2,500 numbers next year. Definitely, the -- and depending on the -- definitely the requirements, we are geared up to ramp up the 5,000, very shortly.
Yes. So my request is to think about building the capacity and then looking for the orders rather than trying to first get the order and then building the capacity because there is a huge lag between getting the order and then building the capacity. Second question is, do you see like -- you look at any investor conference call or 2nd January when you were there on CNBC. Most of the questions, sir, around what's your capacity? What's your order on hand and how much buses you have delivered? Can't we ask make it this simple and transparent and you publish this data on your website? Because transparency and simplicity brings the value to the company, look at the value what Olectra is having today.
Any company which is there in EV sector is having more than INR 25,000 crores of valuation, and we are struggling to achieve INR 15,000 crores of valuation, being a top 5 player in the industry right for last 5 years. I feel that you should look at having deals simple, transparent stats available on the website. Can you please assure all of us?
Yes. Anil, just to clarify, of all OEM, Olectra is #1 in terms of performance, in terms of delivering, okay? So I do not know what kind of information you have. So we have, for your kind information, delivered more than 1,600 electric vehicles as on date. And [Indiscernible] more than 20 crore kilometers on Indian roads. We are definitely striving. We are noting your point, we are striving to do better. We want to perform quarter-on-quarter better than previous quarter.
No, my point is -- my point is -- sorry to interrupt you. My point is our performance is excellent. What I'm saying is that because of transparency issue or maybe timely availability of the stats, because of not presenting the strength of the company on a timely basis to the different investors group, our valuation is not what is being reflected today. So my request is that though we are performing in a very excellent manner, but somewhere the common questions like what's my capacity? What's your order on hand, how much you're going to deliver, how much you have delivered? These are the small statistic simple stat. If you make available on website, it will ease people to know the company's strength and progress, which will reflect in the company's valuation as well.
Yes. Just please note, I'll just give a highlight and then our company secretary will also talk about it. We are a listed company, you are aware, and we are bond by these PIT regulations and information, which is price sensitive cannot be put on a website, right? So forward-looking statements, yes, to the extent of what is in public domain, we can publish, right? I'll ask company secretary Mr. Hanuman to explain.
In continuation of what Sharat clarified, Mr. Anil, I would like to say, most of the information, which you are saying that questions in the CNBC or wherever our CMD have been asked, is mostly price sensitive information. We have to be careful while dealing with the price sensitive information. And other part of your question, why can't it be placed in the public domain. If you see, at appropriate time, we have been disclosing all these information, if you say capacity, what is the time line for commencement of this factory. In our shareholder resolution itself, we mentioned it is 12 months. But whenever we're having interaction with the media, obviously, people who are asking when can we expect.
So we are striving to do that -- to meet the timeline or even before that to complete. In that process, there are some issues need to be addressed. So other things -- order book you were asking. Order book also even 40 buses order also, we have been disclosing to the stock exchanges. It is very much available in our website as well as in the stock exchange websites also. Beyond these certain things, which is anticipatory or which are price sensitive information, we are not supposed to place it on website or even we can't mention in the calls also. I think we would have -- you would understand the severity of the price sensitive information-related issues.
Yes, I was requesting for the actual delivery of the buses to be displayed on the website. Just give me 2 minutes more, please.
Actual delivery of buses in this investor call presentation itself at starting -- starting slide itself, you will find every quarter.
Can you do it on a month-on-month basis instead of in the investor call?
Month -- you are asking for month on month investor call?
No, month-on-month actual delivery of buses on the website, so that we can know the progress of the company.
I think actually, because statutorily, quarterly ones we have to give. In between month-on-month placing in the website actually we have to think of because being it is highly price sensitive information, which will have...
Yes, my last question is that like it's a growing company, so Company Secretary and Chief Financial Officer and CMD has a focus on the company's expansion. And so why not we get Chief Investor Relations Officer, who is 100% dedicated for this purpose and make sure that he is communicating with the media or the investors or the government bodies with the sensitive stats on appropriate time. So that will help, I think, in building -- strengthening the company's valuation and also helping us in getting the right investors on place. Do you think that we should go ahead with the Chief Investor Relations Officer at the earliest?
I think our Board will deliberate first -- all these issues have been deliberating and over the appropriate time we will come up with that.
Please look into this, our important aspect. It's very critical for all the investors, whether it's shareholders or government or otherwise investors, like banks and institutions.
Noted. Noted.
Thank you very much to all of you and congratulations, and thank you very much for leading this company with an example and a good show.
The next question is from the line of Sidharth, an individual investor.
Am I audible?
Yes, you're audible, Mr. Sidharth.
Sir, my first question is regarding the payment security fund, which the government is evaluating. So that is different from the existing GCC contracts that we have right now. So can you just shed some more clarity on what exactly the scheme is, the payment security fund, which -- how will this help Olectra or all the bus manufacturing companies?
So this is very, very still in nascent stage, okay? So as far as currently, the business model is the gross cost contract, wherein as per NITI Aayog model, the STU is the end customer, there to [indiscernible] service rather than CapEx. And just reiterating, all of you are aware, but -- so they are paying on a per kilometer basis to the concessioner. So currently, as per the model, there is an escrow mechanism is in place wherein contract to contract about 2 months or 3 months monthly fee is deposited in the escrow account. So that is how the payment is happening. But the new things like the new announcement of PM e Sewa and all these announcements are still in the nascent stage, which is under discussion. Once we get a clarity and it gets firmed up, it will be definitely reflecting in the public domain.
Okay. But sir, will that help Olectra in like getting more orders or having our...
Yes, definitely, it will help.
Okay. And will that reduce our receivables also?
So it's nothing to do with the receivables because as far as Olectra is concerned, we -- our business model is to manufacture, sell the buses to the concessioner. But security...
Okay. But even when we are selling to the SPVs, there is a lag of like 6 months to 1 year after a certain performance guarantee, like there is 30% or 25% receivables which are outstanding and that we'll get it after 6 months or 1 year. Am I correct?
Basically, under FAME II, the subsidy -- subsidy part, the last leg of the subsidy portion was within 180 days. Now basically, as you're aware, the initial stages, even the EV segment is progressing. There were financial constraint, but now all the public financial intuitions including commercial banks and institutions are very, very bullish. They are coming up and sanctioning the financial closures, all our contracts, the financial closures are either completed or in the advanced stage of completion. So we are not forcing -- as far as Olectra is concerned, we are not forcing any issues with regard to the payments.
Okay, sir. Got it. Sir, my second question will be regarding the average selling price per bus. So what would be that number? Because earlier you had mentioned it somewhere around INR 1.4 crores to INR 1.5 crores per bus. But like this 9 months, you have delivered around 376 buses and if I just divide the revenue by this number, I'm getting INR 1.9 crores. So going forward, is it safe to assume that we'll be delivering somewhere INR 2 crore per bus?
No, it all depends on the sales mix. So if you see the sales mix, if it is 9 meters, it will be less as what we have indicated. If it is 12 meters, it is more. So it all depends on the sales mix, which we have done quarter-on-quarter. So the average, as we have mentioned, the selling price will be in the region of INR 1.2 crores to INR 2 crores.
INR 1.2 crores to INR 2 crores, okay.
And also the sales as 3 components, we have 3 segments, you're aware. So we have insulated segment, which we turnover was about INR 100 crores close by. Electric tippers, we introduced the turnover was about INR 50 crores approximately and the rest is electric buses. And apart from that, we have operating income. And of course, the AMC income which we generate for all the buses which we sell because we take care of the after sale service.
Okay. So just to request that, sir, if you can just give the segment-wise in your presentation, the investor presentation, like the 9MM, 12MM, whatever the bus orders we are fulfilled segment-wise, like different capacity buses. If that presentation...
That becomes lot of details like what is the sales composition. So we are at a very high level, given electric buses, insulator and electric tipper. Segment wise it is already there. You're looking into what is the kind of -- how many 12 meters we have sold that also were indicating in terms of numbers. But in terms of, again, revenue split and all become too much of detail.
The next question is from the line of [Hima], an individual investor.
Just a little bit new to your company. So I had few questions regarding the battery. Maybe you have addressed it several times. So when you are scaling up next year, do you make your own batteries or do you procure it from an Indian manufacturer or does it -- import it through BYD? Is that how it is?
Yes. See, currently, none of the Indian companies OEMs -- India, we do not have facilities as of now to manufacture batteries. Currently, we procure from BYD cells and then make into the pack. So all the OEMs, including whether you name Tesla or anybody, they source from China, which is the largest in terms of battery capacities and technologies. But recently, as you are new to the company, I think the Government of India has introduced PLI schemes, wherein a few Indian companies are coming up with their, manufacturing the cells in India. It will take some time. It may take another 3 to 4 years for the Indian company to come up with the technology. So definitely, we are open based on technology and pricing. Definitely, as a company, we are open to explore. But currently, we are having a strategic tie up with BYD, which is world's largest EV company. Accordingly, we are sourcing the battery cells from them.
Okay. So sir, the second question is, do you see the battery prices declining year-over-year? And do you have to pass off those battery prices when you supply the buses? Or is that your margin? How does that work?
Basically...
We have been hearing that the battery prices are going to decline, right? Over the next 3 -- 2, 3 years, every year, it keeps on becoming more efficient and keeps on -- the prices becoming lower and lower.
Yes. See, currently, what is happening is that we expect the battery prices to come down, as you rightly said, in the next 2, 3 years. And see, we follow -- there is no basically open market price because customer-to-customer specification -- based on specifications, we make the bus. So we follow the [Indiscernible] model accordingly. The margins on a very large scale of 5,000 number could be different from what we are doing currently of our 250, 300 numbers.
So it would expand, right? It would have to go better, I guess.
In terms of absolute numbers, it is going to expand. In terms of percentage, it will be definitely not comparable with what we are doing today.
Okay. So you're saying battery prices, whatever you get, you pass it on to the -- its cost plus model. So even if there is an advantage, you will not take -- your company won't get the advantage of that.
Correct. Correct.
Okay. And sir, absolute final one is. As you said, Indian manufacturer is going to take 2, 3 years to build it. Any of these contracts or going forward, do you vision that some of the government or the city buses that you are targeting may make, Make in India mandatory clause from like last [Indiscernible] do you envision that? Like we see that in solar panels -- like after March 31, they have -- some of them are mandated that they have to be all here. They cannot be from outside -- it cannot be imported.
Yes. Currently also, as per the FAME I and FAME II, to avail the subsidy, a minimum localization norms are already prescribed. And our company, we are very proud to inform the shareholders, we complied with the localization norms. And except for battery cells and few components relating to powertrains, every component is localized in India.
Okay. I see. But that can be strengthened going forward, right? Like we can make it more and more...
Yes, it is a continued process. As we see next 3, 4 years, if the battery cells are also manufactured in India, then it becomes almost 100%.
Perfect. You yourself are not undertaking staff at all for battery cell -- I mean, I know you have the BYD relationship, but you are not thinking also at this scale of calling 50,000 that you have that it will be viable to do these batteries, right?
So we are definitely not in the -- we are not going to manufacture batteries, but we are going to assemble in the new plant.
Okay, yes, sure. That's -- most of the people are starting like that only, you're right. But eventually, you will just have to buy, make a partnership as a white label with somebody in India.
Correct.
[Operator Instructions] The next question is from the line of Faisal Hawa, an individual investor.
Just want to ask a straight question. With the kind of orders that we have, do we feel that we will double our sales every 2 years, at least for the next 4 years? That's one. And secondly, sir, why do you feel that people like Ashok Leyland and Tata Motors have been slow onto this bandwagon. And what are the kind of -- knowing them and their deep pocket as well as they are very good corporate executives that they have? I mean, they could build up a strategy and really come out with competition pretty quickly.
Yes. To answer your first question, yes, definitely, we are striving to double our turnover. So we are targeting a big number next year, our 2,500 numbers against about 700 -- 650, 700 numbers this year. So we are going to see a multifold increase in the top line and bottom-line. So...
Definitely, we will double sales every 2 years for next 4 years?
Definitely, that is our target...
For example if our sales is INR 100 crores will become INR 200 crores from INR 200 crore to INR 400 crore in 4 years from today.
That is what we are striving. It was about [INR 1,130 crores] last year. And for the current 9 months, we did about INR 865 crores on a consolidated basis. And coming to the second question on the competitors, we cannot comment on the competition. So what is their strategy. But the point is they have invested huge amounts on the Euro 4 ICE engine technologies having invested so much, obviously, Euro 6. I mean, having invested so much on the infra, maybe their focus has been a little slow on the EV side. But more than that, we cannot comment.
But they could get their act together. And for example, they have very good managerial talent also and I mean that could probably put us at some kind of a competitive risk? Or is it that the market is too big?
Always good competition -- healthy competition is good for any industry and with so much of expected demand. And all the OEMs put together do not have capacities. Everybody -- so everybody has got a pie to pick up.
The next question is from the line of Aalekh Jain from Anuyog Software Solutions.
Am I audible?
Yes, audible.
Okay. First of all, really congratulations for the outstanding numbers for this quarter as well. I have 2, 3 questions. So the first question is from the technology partner perspective. So right now, BYD, which is technology partners. From what I understand, we have the partnership sorted out with BYD till 2025, right? So what about 2025? So do we have any visibility on that?
Yes. See, we are -- see, we are having a very, very strong relationship with BYD. We started journey together in 2015, our relationship and bringing this EV technology in India. So our relationship is being built on mutual trust and progression from both sides. We expect the relationship to continue much beyond 2025.
Okay. Okay. The second question is order side. Order book side of the things look really good, but I'm only concerned about the contracts, which typically look something like this. So we have to supply 5,000 buses, but we also have to maintain them for 14 years, right? And I'm assuming that the revenue that you are getting from those things is included of all those maintenance and the supply of the buses, right? Is that correct?
Basically, what happens is we sell upfront on -- and then we take care of the maintenance. Maintenance billing is separate over and above the sale of buses. So we generate AMC income year-on-year on the number of buses. And as far as the 12 years or 14 years is concerned, we have a very, very strong service team built across India -- pan-India. And as we are getting more orders, so we have been expanding into various states and various depots. So -- and service personnel are placed in various depots, and we ensure more than 90% on road.
Okay. Okay. So I think you mentioned that we have the order book of right now around 8,100 buses, right? So can you just break down the duration in which we have to supply this 8,000-plus buses?
So on a holistic basis, we can say that next 18 to 24 months, we have to deliver.
Next 18 to 24 months? But the capacity...
Yes. One important point to be noted, for example, MSRTC order of 5,150 buses, the STUs required to create depot space for about 160, 170, 180 depots. Okay, so based on that, we will be building the infrastructure, based on that we'll be supplying the buses.
So the numbers are not -- I'm not able to work out in the numbers part, okay, because we have 8,000 buses that we have to supply in 2 years, 24 months is 2 years. And then this comes up roughly on an average, let's say, if you supply 2,000 buses in the next year, we'll have 2 supply 6,000 buses in the next to next year, right?
Yes, you're right. So we have 2 major...
From a capacity point of view, like it looks quite challenging. And at the same time, let's say, there is a room for the new orders that we will have, let's say, in the next 2 years, if you have to deliver some more orders. Then how are we going to work out on the operations part is what I'm really concerned about?
Yes. See, basically, to start with on a single shift basis, we are going to build the capacity to 5,000 numbers. Generally...
This 5,000 is by when? By when we are targeting 5,000?
By next June, July.
By next June, July. So 1.5 years, this 5,000.
No, no, no. This financial year, '25. This financial year will be ready. Next financial year, '25 will be ready with 5,000 capacity. But we are targeting about 2,500 numbers minimum, okay? And balance, we are going to deliver in '25, '26. Of course, new orders are also coming up. We will -- as and when the orders are received or in the anticipation of the orders we can build, we can expand our capacity because on a single shift basis, we can make about 5,000 and expandable to about 10,000 buses in the next 1 year.
Okay. When you look forward to like getting all these orders completed in the next 2 years, of course; one last question that I had is, so this is for the hydrogen buses that we have in partnership with Reliance, right? So by when can we expect to see these hydrogen buses coming around? Is there any rough duration on that?
See this is the new technology. So we are doing the -- currently under trials. Since this is innovative new technology, just want to take more time. We cannot give any concrete time lines as of now. But we are pursuing -- once the trials are completed, then the next steps follow is homologation after successful completion of the trials. So this being a new technology and it's nascent, it's going to take more time.
So again, what time as in like when can we see the buses in 2 years, in 5 years, if you can just give an idea?
Basically, it is a new technology, it's very difficult to come to the conclusion because this entire technology itself is not there at all in the country. Right now, it is in the R&D, process is going on and trials are going down. Maybe appropriate time actually definitely, we'll come back to the shareholders.
[Operator Instructions] And the next question is from the line of Sandeep from Maverick Fintech LLP.
Am I audible?
Yes, yes, you're audible.
Congrats for the good set of numbers. Congrats -- advance congrats for the new facility coming up within 2 days. So my first question is, as you've already told that the new facility you are going to start with the pilot project in the new facility. When is the regular production going to start in the new facility?
Yes. So we are starting the trial production in -- on 2nd February. We expect the trial to get completed in maybe 2 months' time. So hopefully, in March itself, we may deliver some commercial production, if not March, definitely from April.
Okay. So the regular production is going to start from the -- in the next financial year, that is the financial year '25. And it's going for 2,500 buses, this facility is for -- ready for 2,500 buses or it is ready for 5,000 buses?
Basically, we are building the plant in a granular manner. So one of the facility -- partial facility is getting ready. So where we are doing the trial production. And parallelly, we are working on expanding to full capacity. So that is the reason by end of the next financial year, we'll have 5000 numbers. So on an average, we have taken conservatively 2,500 numbers.
So what I make out is that 2,500 capacity is available to Olectra -- new capacities available to Olectra Greentech from April 2024.
Ladies and gentlemen, management line has been disconnected. Please stay connected, I will connect the management line. [Technical Difficulty].
Yes.
Yes, sir, I'm just asking that from the first day of the next financial year '25, the 2,500 facilities available for full production?
Yes.
Okay. And what happened to the original facilities from where the production is going on right now?
Currently, that facility is a lease premises. So we are going to shift everything gradually from the old lease facility to the new facility, which is owned by us.
Okay. And the second and last question from my side is about the capital raising. Is there any proposal for capital raise from the market or the promoters?
Currently the capital raise, we will come back at the appropriate time. Currently, for the new facility, temporarily, we are going for a debt and internal accruals. So on capital base, we are deliberating, we will come back at an appropriate time.
The last question is from the line of Rohit from Caspian Debt.
So I have 2 doubts. One on the side of this equity raise only. I think the last quarter, you kind of said that you were in discussions for some increasing [Indiscernible]. And now you're saying that we are looking for debt only. So can you just elaborate if [Indiscernible] discussions happened or negotiations happened?
I think Mr. Rohit, if you recall in the last annual general meeting, I think in our Chairman's speech as well as in the question-and-answer session we have clarified saying that we have earlier resolution, which we took for the shareholder -- raising of shareholders' fund, it has been expired. And now we are looking for construction of this factory, we were going for -- construction of the same with the internal resources as well as debt. I think same thing was the confirmed with Sharat in the last Q2 earnings call also.
Okay, okay. Sorry, maybe I missed it. Yes, the second question on -- yes, sorry?
Just to clarify. No issues, please.
Yes. So second question was on, again, I think one of the investors kind of raised this already, but I just wanted to get more detail on it. So currently, we only sell the vehicles, right? Sell the buses. And we do not operate it. Because the operation, I think, goes to our group company, Evey Trans if I'm not wrong, which is not our subsidiary currently if I'm not wrong.
Yes. You are right. Except for the initial 2 contracts, which are in Olectra books. We have about 150 buses, which are operating. So for these 150 buses, we are generating operating revenue. Other than that, our business model has been to manufacture, sell and take care of after-sale service.
Okay. So that take care that those maintenance and all that you talked about, even that is applicable to the next 8,000 orders also, wherein we will also maintain, not Evey Trans will do it. Olectra will do it, you're saying?
Correct. As an OEM, we sell and after sales service also is taken care by Olectra and we generate operating AMC income.
So basically, sir, if the vehicle is of, say, an average per vehicle price that you said, INR 1.2 crores or INR 1.5 crores take it. So when we sell it, we'll get that INR 1.5 crores and then plus the maintenance charges of that will collect over the years you're saying?
Over next 12 years, we'll generate AMC income for all the buses which we have sold.
Okay. But that INR 1.5 crores will hit our bank account first -- on the first year itself.
Yes, yes, correct.
Okay. So no relation of Evey Trans now coming into play when we are looking at these order books?
See Evey Trans is an associate company. So the virtue of the holdings -- holding company, so it's an associated company.
Okay. So basically, to execute these order books, Evey Trans is not coming into play at all is what you are saying -- is what I'm actually asking.
I think, Rohit, let's have clarity on this model of operating. Basically, Evey Trans is the one which participates in the tender by taking the technical credentials of the Olectra as an OEM. So we will sell the buses and eventually, Evey Trans is going to supply to the STUs, and they are responsible for operating the buses. In turn back to back, they will have an agreement with Olectra. So in this entire episode Evey Trans is the one which is going to bag orders. I think you have some confusion about this who is going to bag orders.
Exactly. Got it. Yes, I kind of knew that, sir, but it was just that who kind of get that final income is what I was confused of? I think you kind of clarified that.
This model is [Indiscernible] for the GCC, which is STU driven.
Sorry, sir, can you come back? I didn't get it.
This particular model of bidding by Evey Trans and then Olectra supply is relating to STU driven orders.
Got it. Got it. Okay. Okay. But as you said, the final income will be in Olectra's only even the maintenance thing that...
As that was the last question, I would now like to hand the conference over to the management for closing comments.
Thank you very much. We wish all the investors and stakeholders very, very happy, safe and excellent 2024. As we have always committed, we are confident of delivering better results in H2 compared to H1, and we are striving to cover up the shortfalls in Q1. And with the latest order of 5,150 buses from MSRTC and expected orders from the new STU, we hope to have a very, very strong order book, and deliver excellent results in the coming quarters, especially financial year '24, '25 will be a great year. Thank you very much.
Thank you. On behalf of Olectra Greentech, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.