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Patel Engineering Ltd
Earnings Call Analysis
Summary
Q1-2025
Patel Engineering's Q1 FY '25 revenue remained flat at INR 1,101 crores, due to low order inflow and early monsoons. Despite this, net profit climbed 25.81% to INR 48.17 crores. The EBITDA margin stayed steady at approximately 15%. The order book stood at INR 17,900 crores, with hydro projects comprising 61%. The company aims to grow its order book to INR 25,000 crores over the next year, expecting revenue growth of about 10% for FY '25. Key achievements included substantial completion of tunnel projects in Jammu & Kashmir and milestones at the Arun III Hydropower Project.
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Ladies and gentlemen, you are connected to the Patel Engineering Limited Q1 FY '25 Results Conference Call hosted by Kirin Advisors. The call will be for 45 minutes only. [Operator Instructions]
Please note that this conference is being recorded. I now hand the conference over to Mr. Jainam Savla from Karen Advisors. Thank you, and over to you, sir.
Thank you. On behalf of Kirin Advisors, I welcome you all to the conference call of Patel Engineering Limited. Our management team, we have Ms. Kavita Shirvaikar, Managing Director; Mr. Rahul Agarwal, Acting Chief Financial Officer; and Mr. Aditya Bajaj, Investor Relations. Now I hand over the call to Mr. Kavita Shirvaikar. Over to you, ma'am.
Thank you. Good evening, everyone, and welcome to Patel Engineering Limited Q1 FY '25 Earnings Call. We have provided the presentation summarizing the company's performance for Q1 FY '25, along with the results on the stock exchange for your convenience. I trust you have had the opportunity to review the same. At the outset, this is the first earnings call without the presence of late Shri Rupen Patel. He will be missed. His sudden demise left us all in shock. It took us some days to grieve and get moving ahead. In his own words, the show has to go on. So Mrs. Janky Patel has taken on the role of Chairperson as a non-Executive Director representing the promoter group.
Additionally, I have now assumed the role of Managing Director of the company. Mr. Patel had long held ambition to make Patel Engineering an indispensable part of India's infra growth. Thus our core team of professionals was groomed over the last decade to run the company in all eventualities. Further, we have made recent appointments of [ Mr. Dimelo ] as a whole time Director.
He is an extensive experience of over 38 years in the infrastructure and real estate industry, including international experience. And Mr. Sankara Rao has been appointed as an independent director. Dr. Rao has 35 years of management and engineering experience and expertise in the infrastructure industry, banking and finance and institutional development.
He has 10 years of board level management experience and so in prestigious government of India, All India Development Financial Institutions like IDBI, IDFC, IFCS and its subsidiaries. Thus the company today has a settled leadership that is well worked in all the business operations. Now coming to the sector outlook, the government's proposed spending of INR 11.11 lakh crores on infrastructure highlights. The importance attached to this industry as well economic engine.
Historically, infrastructure has been a labor intensive industry. [ As we INR 1 crores ] invested the infrastructure sector generated 200 to 350 man years of employment for unskilled semiskilled skilled workforce. This, in turn, synchronized well with the government focus on job creation. Interestingly, the unit projects assessed on promoting firm storage projects is a pivotal step towards a sustainable and resilient in every feature.
This opens a huge opportunity for us as more than 60 gigawatts of pump storage projects are under survey and investigation sales, which have come up for waiting in next year or so. With the general election being over, now the order income for the entire industry is opening up, which was otherwise subdued in the last year.
See, hydropower, there is an immediate opportunity of more than 30,000 megawatts of projects of worth more than INR 1 lakh crores are ready to be tendered. Irrigation, more than INR 70,000 crores has been allocated for Jal Jeevan Mission and another INR 9,000 crores has been allocated for Pradhan Mantri Krishi Sinchai Yojana by the center for FY '25 in the recent budget.
This is apart from state budgets where, again, lose funds have been allocated for spending for aviation projects by almost all the states, more than 2,500 kilometers tunneling are coming over more than 800 projects. More than INR 80,000 crores is allocated for road projects. This total INR 3 lakh crore worth of projects. As part of our company plans to grow the order book, we are on course to bid for nearly INR 50,000 crores worth of these open projects and expect to receive around INR 10,000 crores to INR 12,000 crores worth of projects in the next 1 year.
Now coming to the results updates. I will now walk you through some of the key business developments in this quarter. Firstly, the tunnel T15 and Part T-14 project located in Jammu & Kashmir has been substantially completed. And Indian Railways has conducted trial runs on this stage, marking a major milestone in the Udhampur-Shrinagar-Baramulla rail link project.
The USP project enhances all weather connectivity between the Kashmir valley and the rest of India. The project was awarded to us by Ircon International Ltd with a value of around INR 2,300 crores. [indiscernible] technology was adopted to carry out a tunnel work, a total of around 1,600 skilled and semiskilled workers were involved in the project. Secondly, at our Arun – III Hydropower Project site located in Nepal, we have achieved a final breakthrough of the HRT between Phase IV and Phase V, the final breakthrough was achieved on 4 June 2024 in the presence of Honorable Prime Minister of Nepal, Shri Prachanda.
Moving to the new orders for the quarter. The company declared L1 for an irrigation project worth INR 317 crores in Maharashtra, which would be executed as a joint venture with our share of 35%. Coming to the order book position of the company as on 30 June, the total order book stands at INR 17,900 crores.
Out of that, 61% is from hydro, 21% from irrigation, around 11% from tunneling and rest from other sectors. I will now request Mr. Rahul Agarwal, who has taken over as the acting CFO, to take you through the financial performance of the company for the quarter. Thank you.
Good evening, everyone, and thank you for joining the call. I will now run you through the financial performance of the company for Q1 FY '25. On a consolidated basis, the revenue from operations for Q1 FY '25 is INR 1,101 crores, which is in line with the last year revenue, which was INR 1,118 crores.
This was due to subdued order inflow in last year to date due to recently completed election and the impact of an early monsoon and Q4 projects. However, the company expects to grow around 10%, as guided earlier on a full year basis and expect to get multiple orders as bidding has commenced post completion of elections.
And the company expect the order book to grow around INR 25,000 crores in the next 1 year, which will give a boost to the revenues in FY '26. Our operating EBITDA for the quarter is around 15.3% as compared to 15.2% in the corresponding period last year. The net profit is up by 25.81% at INR 48.17 crore for the quarter as compared to INR 38.29 crores in the corresponding previous period.
On a stand-alone basis, revenue from operations for Q1 FY '25 is at INR 1,082.44 crores as against INR 1,090 crores in Q1 FY '24 and operating EBITDA is at 14.9% as compared to 13.95% in the previous corresponding period. The net profit for the quarter on a stand-alone basis is INR 68 crores as compared to INR 130 crores in the corresponding period -- previous period.
This was due to exceptional income of INR 91 crores in that quarter, mainly due to a sale of a subsidiary. The sector-wise revenue breakup on a stand-alone basis for Q1 FY '25 is as follows. Hydropower 51%; Irrigation, 25%; tunneling 11%, roads and others balance 13%.
Moving on to the debt position. The consolidated gross debt as of 30th June stands at around INR 1,500 crores as against INR 1,955 crores as on June 30, 2023, and the total advances from clients have reduced from INR 831 crores to INR 764 crores. And gross serviceable debt has reduced from INR 2,800 crores from in June '23 to INR 2,248 crores in June '24, a total reduction of INR 530 crores.
Further, we have a cash balance of around INR 350 crores as on June 24, as against a cash balance of INR 20 crores, INR 256 crores as on June 30, 2023. The consolidated debt-to-equity ratio has improved from 0.67 to 0.42 in the last 1 year. In Q1 FY '25, we have raised equity of INR 400 crores through QIB and we have further realized around INR 238 crores from arbitration awards.
The same has enabled the company to reduce the debt and also augment the working capital requirements of the company. And accordingly, the finance cost in Q1 FY '25 has reduced from INR 88 crores to INR 84 crores. The debt breakup is as follows: the working capital debt is around INR 830 crores and term debt is INR 665 crores, which is expected to be repaid in the next 2 to 3 years.
Overall, working capital days have also come down. And on a gross basis, it is 206 days but we -- out of which 104 days, we expect to relate to arbitration and claims, hence net normal working capital is around 102 days. Now I'll hand over back to Ms. Kavita for closing remarks.
This has been an eventful quarter, we had to overcome organization loss in the form of Shri Rupen Patel . His far sightedness held us in a good state. Today, the company has a steady order book, a second team and robust systems and processes to take on any eventuality. That said, we are well poised to take advantage of the opportunities and I think out of the government focus on Infra push. That was the update from our side. Now we shall be happy to answer any further questions if you all may have.
[Operator Instructions] The first question is from the line of Chirag Shah from White Spine Investment Managers Private Limited.
So my first question is -- just to -- while there has been a sentiment side demand for, but if you can just elaborate and help us understand that where was the maximum involved in the company in the various business operations and how things will be going headed? Are you making any changes in the fee structure, whether short term or permanent in nature? That will be the first question.
Kavita here. See, Mr. Patel was the driving force of this organization. As I mentioned, his sudden demise left us all in shock. But he always believed in developing professional team, his vision is in all development of people, like in his word the show has to go on. See I'll tell you one thing a core team of professionals was grown over the last decade to run the company in all eventualities. I have been involved in those quarters in turning around the company as you are aware from loads of high debt and minimal order book of to present position. I have been an active part of taking strategic decisions, running critical projects and resolving project issues among other things, for Mr. Patel was a driving force for us. And like his core team engineers, professionals, financial professionals, all we were actively involves and we were working with him under his guidance. So now I can tell you that the professional team developed by Mr. Patel is capable of taking forward his vision ahead and work together as a team, we will come out more stronger.
Hello.
Yes, Chirag.
So, it will be safe to even, assume that client interaction, client-facing also the team was there and here. So it will not be that bigger sale for us to carry his legacy forward, that is a safe assumption to make.
Yes, Chirag, I was actively involved in project execution and meeting all clients.
Yes. Yes, layout this is just to reassure the investing community about it. So the second question is ...
Chirag, this is business as usual for us company run as it was.
And my second question is on order book. So I presume by Q3, we should start seeing the momentum back from government/central agency, central PFCs site. That is a safe way to look at order book flow momentum.
Yes. So the order building has started both elections in this quarter and order inflows start looking maybe 3 months or something down the line.
Okay. So that's -- so Q3 is a reasonable, so somewhere in Q3 or Q4 is a reasonable assumption. They will start awarding the orders.Then because would be breaking the orders and all those stuff, right? That is a fair assumption, 3 to 6 months' time.
Right.
Right.
Good. And on the immediate basis, would you like to make a comment where -- how many orders have you built, which would come out in the next 12 months? Would you like to comment anything on that side?
So the bidding has just started. We have identified around INR 50,000 crores of work to bid immediately. So that thing will start now.
Okay, great. And lastly, on margins, how should one look at margins. We would be in the similar historical range? Or we can see some uptick on the margin range that we have.
Historical range.
[Operator Instructions] The next question is on the line of Ananya Swaminathan from C-Square Info Solutions Ltd.
I want to know the current order book status. And the bidding in playing at it.
So current order book is around INR 17,900 crores, which includes an L1 of INR 100 crores, and that L1, LO has received recently. So -- and pending pipeline status is around INR 50,000 crores.
Okay, sir. And what about the institution period?
Around 4 years.
Okay. And any other area we are targeting other than hydro?
So we are targeting hydro irrigation, tunneling and we also look at roads at reasonable work we come in.
Okay. And for irrigation margin in order book size would be?
It depends on the project to projects, like it starts from INR 500 crores, INR 2,000 crores, INR 1,000 crores, INR 500 crores.
Okay. And how much are we visible to this?
There is no restriction as such.
Yes, there is no restriction as such. Whatever projects are coming up for bidding, we are able to build. It's only we have to decide which one will go ahead.
The next question is from the line of Prashant Kshirsagar from Unived Corporate Research Private Limited.
Yes. I just wanted to ask you [ 3 ] the questions. One is how many employees you have at the moment with the breakup on the technical side and the non-technical side?
So total employees is around 4,600 of which almost 50% would be more than technical side.
50% would be technical side. Okay. And can you share the number, which is -- which was there on 31st March 2024 and to 31st March 2023 for the same?
So '24, I think is somewhere around same 3 and INR 4,500 crore, and for '23 would be INR 4,200 crores, INR 4,300 crores.
INR 4,200 crores. Okay. Second question is the arbitration about money which is received with the line item it goes to it goes in reducing the other expenses or it goes in the other income part of it?
No. So this is arbitration money received. So that will improve my overall receivable position and all in the balance sheet.
So it doesn't come in the P&L at all.
No, no.
That was just a second one because you don't make any money on this thing because sometimes what happens is you get a profit margin on the cost escalations. So that is not...
No, no. So I see if it is an arbitration award already awarded in our favor and then it is there on the books, then there will be received in the P&L for the same.
So you don't get some extra profit or something on the cost escalations or whichever technical fees you were once improvement or anything?
We receive that we receive when the arbitration award is received.
Okay. So you account for it at that time.
Yes.
Okay. Just to clarify that. And third question was in regard to Subansiri hydroelectric project, have you completed your share of work? Or is it pending still?
So the work is going on, and we expect to command in another 1 year time.
Yes, there are some phases to be completed is being done accordingly.
but project is progressing as per scheduled.
As per scheduled. Okay. And last question is about this irrigation project, which you received recently, you said your partner with someone. Can you share the name of the partner in that?
Sir, It's a local partner [indiscernible] structure some name is -- yes, local partner.
The next question is from the line of Viraj Mahadevia from Mani Group.
Well understood on the order book buildup slowdown given elections, et cetera. But Q1 FY '25 revenue from operations, was that lower or flat based on the monsoon or what is the reason for lack of pickup given that we already had an existing order book?
So see, there are a couple of things in there. One is because there was a minimal order inflow in the last year. So the water or revenue is flat. We had expected a little jump up, but there were some early monsoons at some of the project side. So then this quarter, revenue was flat. But on a full year basis, we still expect to be there around 10%.
Understood. Any plans given the INR 650-odd crore term loan debt, any plans to hive off the noncore assets that you all have highlighted before. Any progress on that in terms of land parcels, et cetera, in client locations to bring that down faster apart from the arbitration money of INR 200-plus crores every year.
See, we are in discussions for various land parcels. So post elections, again, the things will start because still election things were not -- there were no discussions happening. And so let's see, maybe not this year, something next year.
[Operator Instructions] The next question is from the line of Shyam Garg from Ladderup Finance Limited.
My first question is with respect to what is the conversion ratio of orders remain in the past?
So between 20% to 25%.
So if they are looking for INR 67 crores of order then we can expect somewhere around INR 10 crores to INR 2,500 crores of order book that tithes year?
Yes, that's it.
And we remain impact with our revenue and EBITDA margin guidance that has been provided earlier for a 10% to 15% growth in revenue and around 15% EBITDA margin revenue.
Yes. So we still expect around 10% growth in revenue. The EBITDA will be maintained like 14% of what was there.
Okay. And with respect to the arbitration, do we expect this more arbitration awards to be received in this financial year? Or it is up to a level of INR 220 crores and INR 230 crores.
So we will see maybe some collections may happen, but we're not sure whether this year, it may go up to next year.
The next question is from the line of [ Shaily ] from Unity Finance.
So my question is how do you plan to those 2 orders this year after the slowdown in financial year '24?
So there are a lot of orders which were pending in pipeline to be coming up for bidding post election. So now the bidding has started, and we expect a lot of orders to come in, in the next 1 year.
Okay. So with the MD Sudden passing was the plan for leadership going forward?
Ms. Janky Patel has taken over the role of Chairperson representing the promoter group, and I have now assumed the role of Managing Director of the company.
The next question is from the line of Manu Jindal from Thorin Technology.
My very first question is regarding the press release where you've mentioned the consolidated Q1 FY '24 part of INR 38.29 crores, there is in the presentation that as around INR 50.36 crores. Can you just help me out why is there bio divergence as well due to the other income?
Sorry, Summer, your voice broke in between, so we could not hear it. the consolidated PAT for net profit for owners is INR 48 crores in the presentation as well. And...
No, no, no. Sir, my question. My question was, in the press release, it has written that Q1 FY '24 PAT is INR 38.29 crores, whereas in the presentation, Q1 FY '24 part has written at INR 30.26 crores. So why is there ...
Okay. INR 50.26 crores in the presentation is net profit from containing operations. If you -- last year, there were some discontinued operations for a subsidiary, which was sold. So that [ 23 ] negative was there and then net work INR 38 crores.
I get it. I get it. Sir, my second question is regarding the value of noncore assets still remaining with the group and what according to your expectations would be the time line when it would be more data?
So we expect out of the land bank, what we have, we will first started new land parcels of maybe between INR 200 crores to INR 300 crores, and that realization time line is over next 1, 2 years. Apart from this, whatever money we'll get from arbitration awards is extra.
Got it. And sir, regarding the order book which you have mentioned where you have broken down the percentage wise population age. Just wanted to know what is the general for all the order book? What is the general duration of these projects, like if you see the average duration or I don't know, like the metric at tract for the duration of these projects, what is the average duration for these projects?
4 years is what is the book-to-bill ratio right now.
Got it. And the revenue recognition is based on the milestone, like as and when the milestones are achieved in voice to the customer, am I correct?
So it is a percentage completion basis, the revenue group and invoices in projects are on a monthly basis based on the quantity executed as per the contract.
Okay. And sir, regarding the completion stage of below 12%, where your order book is INR 6,613 crores as per the presentation -- What is the order book, which is not even started yet, like below 10%, we know it's INR 6,613 crores. But what is the order book that has not yet been started? Like what is the zero posting market. What is the value of that order book?
Only one pure which was land now the LOAs received where all projects have started, so there is no project to all or anything.
[Operator Instructions] The next question is from the line of Ananya Swaminathan from C-Square Info-Solutions Ltd.
I wanted to know what -- is that planned for long-term debt reduction? And will there be any interest cost saves?
See, interest cost saving is there in this year because of debt reduction happened. And long-term plan is the term that we want to make it mill over the next 2, 3 years. There will be working capital debt based on some additional projects taken some additional working capital that may be taken. But the overall serviceable debt may not increase.
Okay. Okay, sir. And is there any further revision for credit rating? Is it possible?
So it was recently upgraded to A minus from BBB+ post our March results. Next review may happen probably after end of March next year.
Okay. And what your outlook for the sector, how much order we are targeting?
Sorry, I could not hear your question. Can you repeat, please?
What is your outlook for those sectors, specifically, like how much order are we targeting?
Road sector is not a core focus target for us, but we'll still look for projects. And whenever we expect good projection coming...
Road project selectively we will bid for the project.
Okay. Okay. So any other focus area would be [indiscernible]
Focus area would be hydropower projects, which are coming up newly 60 gigawatt of deposits are expected to come out in the next few years. So that is one area which we see that a lot of projects will come. Government budget also has given focus on that. So apart from that, in relation tunneling we are doing anyway. So that will continue to do.
Okay. So what is the expected building in that area.
So right now, whatever INR 50,000 crores we identified is covering everything, then maybe after 6 months, we'll see more new more projects will come.
Okay. And any new projects in Northeast, from Northeast?
Northeast also.
The next question is from the line of Aashka Trivedi from Cadia Securities Private Limited.
Am I audible?
Yes.
So sir, my question is that in the opening comments, you have highlighted on Stores as a huge opportunity. So have you executed any order in this segment in the past?
Yes, we are doing 1 comes to it to sit right now, around 4 from projects have been executed in India, 1 we are doing.
So are we doing it in a partnership or a stand-alone basis?
Standalone.
Standalone, yes.
Okay. And who would be our competitors in this space?
So it is similar to what we have for competition for hydropower.
The next question is from the line of [ Ashwin ] from Cogen.
So we have seen a remarkable increase in our net profit. So can you just highlight some points because as of flat growth, we have really done very good at the bottom line level. Second can you please highlight what has driven such a 35% plus growth at terms of bottom line for the consolidated numbers?
Majority would be the reduction in the finance cost because we have reduced in costs around INR 4 crores, INR 5 crores. So that is one of the major reasons. And when what we see is a little -- this quarter, little EBITDA margin was higher when compared to the previous 1.1%.
Okay. sir, what is the plan for the whole FY '25 towards the debt repayment?
See debt repayment, right now, we have already made the debt repayment for whatever money we have realized from arbitration awards and also we had surplus money from Q1, which has been reduced -- used to reduce the debt, which may be used for working capital when that new projects come in. And going forward, as and when money gets realized from arbitration awards or other noncore assets, we will reduce the debt.
Okay. So what kind of a growth guidance you would like to give for net profit for the year?
Net profit, see, it is turnover and EBITDA is similar. So net profit accordingly got savings in further apart from that interest costs will be card from last year that will directly add to the process.
Okay. And so we have our current order book standing as of June INR 17,00 crores, so what is the time line? When do we expect this sort of go? When you say how much do we expect in terms of the revenue and going forward for the '27 from the current book?
So this is a book-to-bill ratio of 4x. So accordingly, the revenue will be there.
Okay. And sir, lastly is assessment and the minister Mr. Patel's demise tail. But after proportionally, the company has been very successfully handled by you and Kavita ma'am and other professional ties. So what kind of a confidence have you faced anything any problem by applying for any tender servicing many segments at the change in management? Or how is the response?
So tender is based on our company prequalification. So there is no issue as such. We are continuing bidding for the projects.
So there is a positive response for the [indiscernible]
You have to see all staff, senior staff and all they are there for a company for long. So that thing continues. There is no change as such at that location.
So for us, business as usual, we are continue bidding for the project. Our execution at all project sites are also going on as per schedule.
Yes but, see the company has been handled with the for a splash but there are sentiments. So I just wanted to understand any response.
No, you are right, correct. So for bidding, there is no exempt.
And sir, are we planning to materialize anything from the landfill or the asset in which we have to monetize or we will keep it on a hold, again, you see there would be some.
So we'll keep on discussing. We are not in rush to do it. We will keep on discussing as and when we get good offers, we'll go ahead.
The next question is from the line of Snehal Pawar from [ PSB Capital ]
Hello. Am I audible?
Yes.
So my question was, which projects or sector will you prioritize in the upcoming years?
So we would like to maintain a similar mix of hydro contracts would be a maximum portion of the order book, other segments will cover balance 40% to 45%.
Okay. Okay. Sir, one more additional question, sir. new chapter, they have improved margin that we are seeing in this finance is that this quarter? Q1 FY '25.
It's just about the mix of the work.
The next question is from the line of Manu Jindal from Thorin Technology.
Yes. Sir, my other question is regarding the competitive intensity. Like recently, I think, 4 to 5 months ago, there was a news article, which was mentioning that Patel share of hydroelectric energy sector is like 45%, it has jumped from 25% to 45%. Just wanted to know like 45% is a pretty huge market share.
What is it that for Patel engineering employs as a competitive advantage which bigger players are unable to match that kind of help in this market?
So see, we have like the experience factor, which is there for very long. We have been working most of the projects of hydropower projects come in the Northeast, J&K, Himachal, and we have been working there since ages. So we know the terrain well, so we are able to plan well.
And we have that experience a equipment and everything because hydro is again a specialized work.
So we are known for our -- yes, yes, sorry. We are known for our unmatched capabilities in successfully undertaking challenging and time-consuming projects in the hydro segment. We have a team of like technical in strong technical team and capabilities, which differentiates us from rest of the others.
Okay. And ma'am, my last question is about the technology upgrades, which happened in this sector. Like how do we essentially ensure that we are upgrading the technologies? How do we get this knowledge transfer? Is that by resetting other countries? Or how does it exactly happen?
So I see we have a mechanical head. We have a procurement in source, we have a technique technology like who is evaluating and addressing the whatever latest technology available in the market, we try to implement, like recent example, at our crore, we developed and I think assembled over well system for the concreting, mark concrete. So we did on our own. This is first time in India, we did actually.
So these kinds of innovation, research and development, we have a special team allocated [indiscernible] also.
And yes, they go across the world to look at and identify new technologies.
[Operator Instructions] The next question is from the line of Ananya Swaminathan from C-Square info Solutions Ltd.
Yes. I wanted to ask China expanding over Brahmaputra. So do you have any idea what Indian government is doing? Are there any new hydro projects -- is government planning. So that 2% flood or anything?
So there are multiple projects identified in the Northeast. And so they are coming.
Okay. Like apart from Northeast, Himachal or Uttarakhand are there any new upcoming projects from Himachal?
Yes. So Himachal, Northeast, Uttarakhand, J&K, Nepal, these are the main places where upcoming to this will be there.
Thank you. Ladies and gentlemen, as this was the last question, I would now like to hand the conference to the end. I would now like to hand the conference over to Mr. Jainam Savla for closing comments.
Thank you, everyone, for joining the conference call of Patel Engineering Limited. If you have any queries, please write us at research@kirinadvisors.com. Once again, thank you, everyone, for joining the conference call.
On behalf of Karen Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.