SJVN Ltd

NSE:SJVN

Earnings Call Analysis

SJVN Q2 FY'24 Earnings and Growth Plans

During Q2 FY'24, SJVN's generation dipped by 3%, leading to a marginal revenue fall of 1.1% with INR 870 crores in revenue from operations, down from INR 880 crores the previous year. Total income nonetheless increased to INR 952.69 crores, due to a rise in other income. The profit before tax improved slightly to INR 555 crores, but profit after tax fell by INR 9.7 crores to INR 441.35 crores. The company detailed substantial growth plans, including adding 10,000 megawatts over three years and having been appointed a Renewable Energy Implementing Agency (REIA) by the government. SJVN aims to tender at least 10 gigawatts annually, with an expected 36,729 million unit generation translating to around INR 260 crores in revenues from a 7 paise per unit commission.

Navigating Headwinds in Revenue and Profit

In the recent quarter, revenue from operations saw a slight dip of 1.1%, coming in at INR 870 crores compared to INR 880 crores in the previous year. The company's total income, however, edged higher to INR 952.69 crores, up from INR 921.26 crores, buoyed by an increase in other income from INR 40.52 crores to INR 81.95 crores. Expenses slightly increased to INR 397 crores from INR 386 crores, leading to a profit before tax (PBT) of INR 555 crores, a modest increase from INR 534 crores. Profit after tax (PAT) fell by approximately INR 9.7 crores to INR 441.35 crores, while the net worth grew to INR 14,280 crores, compared to INR 13,970 crores last year.

Expanding Role in Renewable Energy

The company has been appointed as a Renewable Energy Implementing Agency by the Indian government, joining three other entities. Leveraging this position, the company is tasked with collating energy demands from states, facilitating bids for renewable projects, and signing power purchase agreements. In return, the company will receive a commission of 7 paise per unit of energy supplied. In the competitive tender process, 1,184 megawatts of capacity resulted in the discovery of the lowest price of INR 4.38 per unit for supplying round-the-clock power. The company has been tasked with bidding for 10-12.5 gigawatts of capacity annually, translating into a significant capacity addition of over 100 gigawatts within the next decade.

Promising Revenue Projections from Renewable Energy

For the first year after the tender process completion, the expected revenue is INR 231 crores, and the company anticipates a substantial growth in revenue up to INR 460 crores in the following year, assuming the capacity doubles. Over the next five years, this Renewable Energy Implementing Agency (REIA) mode is projected to generate an additional profit of around INR 4,000 crores as capacities triple and quadruple. With this new business model, the company aims to add another 10,000 megawatts within three years and reach a total capacity of 25 gigawatts by 2030. The model assures power supply for at least 17 hours per day, emphasizing round-the-clock power as a sustainable and efficient energy solution.

Capital Expenditure Forecasts Indicate Growth

The company set its capital expenditure target at INR 10,000 crores for the current year and has already achieved INR 3,800 crores, despite delays in quarter 1 and quarter 2 due to environmental disruptions. Major expenditures are planned for the latter half of the year, particularly quarters 3 and 4. Looking ahead, the company has increased its CapEx target to INR 12,000 crores for the following year, signalling an optimistic outlook towards future project completion and expansion.

Earnings Call Transcript 2024-Q2

[Operator]

Ladies and gentlemen, good day, and welcome to the SJVN Limited Q2 FY '24 Earnings Conference Call hosted by Elara Securities Private Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Rupesh Sankhe from Elara Securities Private Limited. Thank you, and over to you, sir.

[Rupesh Sankhe, analyst]

Yes. Good afternoon, everyone. On behalf of Elara Securities, we welcome you all for the Q2 FY '24 conference call of SJVN. So I take this opportunity to welcome the management of SJVN represented by Mr. NL Sharma, sir, Chairman and Managing Director; Mr. Akhil Singh, Director of Finance. So we'll begin the call with a brief overview by the management, followed by a Q&A session.

Now I will hand over the call to Mr. NL Sharma, sir, for his opening remarks. Over to you, sir.

[Nand Sharma, executive]

Thank you, Rupesh. Good afternoon to all the analysts and the persons present over here. The brief overview, first, I will present the numbers for the Q2 and the half year, followed by some new information to the investors and the analysts, new income stream which we are going to add. So RE implementation against EBIT we have -- that we occurred, 1 of the 4 REIA by the government of India.

So -- but first of all, I will deal with the numbers for the Q2 of FY '24. Because of lesser discharge in the river, particularly for the hydro projects, more than 90% revenue comes from the hydro projects, water discharge in the rivers because of many reasons, less precipitation, then tremendous floods during the Q2 period also, which forced the shutting down of our projects, shutting down of generation because of the high [indiscernible] floods.

So generation was very less. Generation, if we talk of the total generation, total generation in the Q2 was 4,202 million units as compared to 4,327 million units last year. 124 million is less. That is around 3%, close to 3% lesser generation.

Because of this, revenue from operations decreased by about 1.1%. The revenue from operation in the Q2 was INR 870 crores, marginal decrease from INR 880 crores last year. So there was a decrease of INR 10 crore revenue from operation.

Total income also decreased from -- total income increased because of other income increased. Other income last year was INR 40.52 crores. This year, it was INR 81.95 crores. So total income increased marginally by about INR 31 crores. Total income this quarter was 952.69 compared to 921.26 last year.

So -- but expenses also increased by about -- marginally increased our expenses by INR 10 crores. This year, expenses were INR 397 crores compared to INR 386 crores last year.

Profit before tax marginally increased by INR 20.57 crores. Last year, the PBT was INR 534 crores and this year it is 555 crores, increase of INR 20.57 crores.

Profit after tax decreased by about INR 9.7 crores. This year's profit after tax is INR 441.35 crores compared to INR 451 last year. So net worth increased by about INR 318 crores. Net worth this year at the end of quarter 2 is INR 14,280 crores as compared to INR 13,970 crores last year. Book value increased by [ 81% ]. Book value of our share is INR 36.36 compared to INR 35.55 last year.

Generation, I have already told. Plant availability factor of our hydro projects decreased because of the shutting down of project during the flood season. There were unprecedented floods in Himachal Pradesh this year, in the [indiscernible] river also. So there was continuous shutdown of -- for our power projects for 4 days to manage or to save the projects from [ the debits ]. So plant availability factor was 105% as compared to 109% last year. The incentive, total incentives also decreased. It is INR 59.44 crores this year as compared to INR 73.3 crores last year.

Now I will tell about last -- in the last quarter presentation, I have presented that in the coming 3 years, we are going to add about 10,000 megawatts of energy, and portfolio of our installed project will rise to about 12,000 megawatts. So in the coming 3 years, we will be adding capacity to the asset of 10,000 megawatts through our more than 50 projects of hydro, thermal, solar, wind, all these projects. These projects are mostly -- most of the projects are in pipeline. So some of the projects are in construction. As of now, [ 15 ] projects are under construction, and more than 20 projects are in the pipeline.

So these projects will be commissioned in the coming 3 years, and the capacity from the present 2,092 megawatts will increase to 12,000. But the new thing which I would like to share with all the analysts and the investors, that SJVN has been designated today as a Renewal Energy Implementation (sic) [ Implementing ] Agency by government of India.

At present, there are 4 RE implementation agencies. One is SECI. Another is NTPC, then NHPC and recently added the SJVN. So through this REIA, I will short -- call it short name REIA, Renewal Energy Implementation (sic) [ Implementing ] Agency, though REIA, we collect the demand from these states or discoms, and then -- for the renewal energy. Then we invite the bids from developers. The developers [indiscernible] project, then the PPOs are signed between these developers and the discoms or the states. And the SJVN will get 7 paise per unit for this energy which we will supply to the discoms.

So this energy demand or -- which we will be overseeing or we will be coordinating will be in 4 forms. One is pure solar projects, then pure wind projects, then hybrid, solar and wind, then this RTC, round-the-clock power, that wind, solar combined with the battery energy storage system. So we floated the tenders for about a 1,500 megawatt capacity for this RTC, round-the-clock power to the discoms.

So against this 15-megawatt capacity, there are about 9 bidders. Nine bidders participated in it and there was intense competition. The -- few have provided in this minimum [indiscernible] 70% energy. And it was assured that energy will be provided for 70% of the hours. That means out of 24 hours, about 16, 17 hours energy will be supplied through this RE plus battery energy storage system, so RTC.

So for these [indiscernible] capacity, we got the kind of base of about 1,184-megawatt capacity with green [ shoot ] option also. We can increase the allotment also depending upon the requirement from the states or other discoms.

So far, this 1,184 capacity, we could be completed or conclude the tendering process. And the final step are the e-reverse auction and the final -- the lowest price discovered for this RTP was INR 4.38. It is quite reasonable that you are getting energy for at least about 17 hours at the rate of INR 4.38 through different sources, RE plus battery energy storage system.

So this is very innovative, and this was our first attempt. The target which government of India has assigned to us, to bid about 10 gigawatts, 12.5 gigawatts of capacity every year. So that means in the next 5 to 10 years, we'll be adding about more than 100 gigawatt, 130 gigawatt capacity, so this REIA mode.

We have worked out the different models for this. This model was RTC model. We will be shortly floating tenders for the solar, for the wind and for the hybrid also.

So the target which we have kept, that at least 10 gigawatts capacity will be floated at least. We'll be increasing it also. The target is 12.5. But we have worked out some numbers also. Out of 10 gigawatts, 3 gigawatt will be at least this RTC, then 3 gigawatt hybrid, wind and solar, then exclusive build will be 2.5 gigawatt and exclusive solar will be about 1.5 gigawatt. That is 10 gigawatts. And we have worked out the energy generation and the revenue income which we'll be getting as a commission of 7 paise per unit from the discoms also.

So in a year, total generation from this 10 gigawatt will be around 36,700 -- 36,729 [ million units ] will be generated. So -- and total revenue from this will -- this will be about INR 13,000 crores, and 7 paise per unit, we will be getting on INR 260 crores. And the expenditure of this [ power ] establishment itself will be, say, about 10%. So we will be getting about INR 231 crores in the first year.

So this tender, this will be floated, which are -- in the first year will be generating energy after 1.5 or 2 years. So it means in this FY '24 we are quoting, we will get revenue generation and revenue in FY '26.

So from FY '26 onwards, the revenue from this source through REIA mode will be INR 231 crores -- INR 30 crores -- INR 230 crores in the first year, then INR 460 crores in the next year because capacity will be doubled, and the third year capacity will be tripled and in the fourth year as well. So in the first 4, 5 years, by FY '29, FY '30, so additional income, pure income, pure profit which we'll be getting will be around INR 4,000 crores. So in the -- by the -- in the next 5 years, we'll be getting additional profit of around INR 4,000 crores in the next 5 years.

In the first year, it's around INR 230 crores. Next year, we will double. In the third year, we will triple and so on. If we increase the capacity and as the capacity every year sees more capacity addition, net revenue generation, our income will be more.

So this is a new business model which we'll be adding to our existing operations, our existing capacity, our existing portfolio. This is the additional source of income for the company. And we are sure that the target which we have kept, that another 10,000 megawatts in the next 3 years and another 23 megawatts in the next 7 years, so we will reach 25 gigawatt by 2030.

So this is the preliminary submission. So you are open to the question -- we are open to the question now.

[Operator]

[Operator Instructions] The first question is from the line of Apoorva Bahadur from Goldman Sachs.

[Apoorva Bahadur, analyst]

Sir, wanted to understand this REIA business opportunity. What -- or how would the payment security be determined over here? Who will sort of provide the security? Will the liability lie on us?

[Nand Sharma, executive]

Yes, Apoorva. About this REIA, R-E-I-A or we can call it REIA, as I told that government has designated 4 REIA agencies in the country: SECI, NTPC, NHPC and SJVN. We collected the demand or the -- from the states or discoms approach designated agency for the arrangement of energy for them. So these already posted. And the scheme which government of India has approved, that a designated agency, REIA agency will get 7 paise per unit as an arranger or the commission or like that we'll get. So we got demand of about 1,500-megawatt capacity from different discoms, or we are in discussion with them also. So we floated the tender for RTC, round-the-clock power, RE power. So we got a response from many developers, including Tata, ACME, [ ReNew ] and all these other agencies, [indiscernible]. There were 9 bidders in that. And they bid for 1,184-megawatt capacity.

[Akhileshwar Singh, executive]

1,450, this was [indiscernible].

[Nand Sharma, executive]

1,138 car allotment. So when the energy generated and supplied to the discoms, energy distributed by these developers, 4, 5 -- 5 developers are getting the allotment. Five developers are getting the allotment, some 300, some 200 or 100 [indiscernible]. So whatever energy will be supplied to the discoms and the revenue will be realized, and we will get to 7 paise per unit.

[Apoorva Bahadur, analyst]

That, I understand. That's very clear. What I want to understand is that, historically, I think SECI used to be this intermediary. And SECI would provide a payment security as well. So in case the discoms did not pay or there was a delay in payment from the discoms to the renewable developer, SECI would sort of step in and make good the difference for the time period. So I want to understand whether SJVN will also have to perform a similar activity under this in case there's a delay in payment from the discom.

[Nand Sharma, executive]

That debt, SJVN will retain responsibility activity.

[Apoorva Bahadur, analyst]

How will we sort of derisk ourselves in this case? Is there a back-to-back agreement with the discom or is it covered under the tripartite agreement? Or are we creating a payment security fund? How do we intend to do that?

[Nand Sharma, executive]

Yes, we will be creating the payment security fund also, and the agreement will be tripartite.

[Apoorva Bahadur, analyst]

So in case the discom does not pay to the developer, we can directly approach the ministry and ask...

[Nand Sharma, executive]

Yes, yes, yes.

[Apoorva Bahadur, analyst]

Okay. Okay. So that risk of default will not lie on us?

[Nand Sharma, executive]

Yes, that will not.

[Apoorva Bahadur, analyst]

Okay, sir. Understood. Very helpful. Can you also provide the breakup for incentives for the capacity incentive on the UI?

[Nand Sharma, executive]

Yes, I will. Breakup for the quarter for incentive, the capacity incentives. Capacity incentives were to the tune of INR 51.25 crores. So out of this INR 51.25 crores, for Nathpa Jhakri project, INR 29.88 crores; and Rampur project, INR 21.45 crores. So total INR 51.25 crores capacity incentives.

Then UI or DSM, what we call now DSM is INR 8.18 crores. So out of this INR 8.18 crores, INR 3.53 crores from Nathpa Jhakri and INR 4.65 crores from Rampur project. And RET, negligible about INR 0.1 crores.

[Operator]

[Operator Instructions] The next question is from the line of Rupesh Sankhe.

[Rupesh Sankhe, analyst]

A couple of questions, sir. Firstly, sir, we are expecting our capacity to increase from 2,000 megawatts to 12,000 megawatts in the next 2 to 3 years. So what will be the equity once we get the 12,000-megawatt capacity in operation? That will be the first question.

And second question is, sir, what is the status of Arun-3 and Buxar? Are they on a track to -- on the track?

[Nand Sharma, executive]

Yes, Rupesh. Capacity is 2,000 to 12,000 megawatts. You have asked about the equity. Out of this additional 10,000-megawatt capacity, our 4,500-megawatt projects are already under construction. And in most of the projects, we have used equity upfront. More than 90% equity has been used upfront.

So far this capacity, 4,500-megawatt equity has already been [ included ]. But whereas the equity for the rest of the 5,500-megawatt capacity projects, so equity requirement, the total investment will be around, say, INR 35,000 crores. So out of INR 35,000 crores, we'll be requiring about 7,000 -- 20% equity or INR 7,000 crores to INR 8,000 crores equity will be required. So that, we are comfortable for that. So there is no issue of equity arrangement.

You have asked about the status of Arun-3 and Buxar project. You know that hydro projects, problems are there. But our team at site and other locations, they are able to tackle the situation.

In the Arun-3 project, there were [ fires ] in the early season, and the monsoon season also, there were some [ shared power for ] giving of divergent tunnel. Now that the cavity has already been treated, and we are through. Heading has been completed. Now banking -- most of the banking is also complete. So we will be -- we are through that cavity of the divergent tunnel. Now we expect that by mid of December, this divergent tunnel will be back in shape and water will be diverted through that. And we will be able to start completing bulk of the dam also.

On the other fronts, HRT, headrace tunnel, it is about 11.84 kilometers. So we are left with only what 400 or 500 -- 400 meters excavation heading. So there's no issue of HRT.

In powerhouse, actually [indiscernible], we are already in advance stages. So we expect that in the financial year of -- next financial year, we'll be able to commission the project, Arun-3.

And Buxar also, there were some issues of acquisition of additional land for [indiscernible] water corridor. There were some objections regarding compensation from the farmers. So that issue has been raised to the appellate court for announcement of the compensation. And we are almost near to completion of the process, and that land then is hand over -- handed over. So there are little delays also. The first unit, which was expected by the end of this financial year, we'll be able to commission the first unit of Buxar thermal project by next September, October '24.

[Rupesh Sankhe, analyst]

Yes, sir, on the gross stock count, point #7, you have mentioned 3 projects which are under construction, Luhri, Sunni and Dhaulasidh. There is some mutual agreed implementation in spending. So can you throw some light on that and tell me what is that?

[Nand Sharma, executive]

Yes. The MOU was signed in 2019. And there was a condition that implementation agreement will be signed between SJVN and the government of Himachal Pradesh on mutual agreement basis subsequent to the signing of MOU. But because of the reasons, that took some time to come on this mutual agreement stage. And that agreement was mutually agreed by the 2 parties by, what, August 2022, by August '22. So we requested the state government to sign the implementation agreement, but that was the period of transition period, election period were very close. So that could not be signed.

And after the change of the government in December '22, the government put the condition that we need to revise deal terms and condition in terms of free power or GST reimbursement like that. So we requested them that these are the MOU signed way back in 2019. And all the projects were appraised and approved by the competent authority, by government of India up to the [ Chairman's ] committee on economic affairs on those terms and conditions.

If we revise these terms and conditions, the projects will not be viable then. So there is some -- we have -- we are again talking to each other on different matters or settlements are underway. So what we -- work on these projects is going on [indiscernible].

[Operator]

The next question is from the line of Dhruv Muchhal from HDFC.

[Dhruv Muchhal, analyst]

Sir, under the REIA model, you have concluded 1,500 megawatt already, right, sir? One tender is done. Sir, you have received interest from discoms for the whole capacity or you're in works to complete that process?

[Nand Sharma, executive]

We have received consent for INR 1,500 crores -- 1,500-megawatt capacity.

[Dhruv Muchhal, analyst]

So the discoms have -- are ready to sign? We have the discoms who will sign the PPA -- are ready to sign the PPA?

[Nand Sharma, executive]

Yes, ready to sign.

[Dhruv Muchhal, analyst]

Okay. And so you're looking to sign -- you're looking to tie up, say, 10 gigawatt every year if I'm not wrong, if I have it right?

[Nand Sharma, executive]

Yes.

[Dhruv Muchhal, analyst]

How does the process work? Do you go to the discoms first and get interest from them? And then do the tender, or you do the tender and then go to the discom to see if they are keen to buy at that price or not?

[Nand Sharma, executive]

It's both ways. It's both ways. We also approach the discoms or the state government. Our team studied the energy requirement in every state, what is their [ RP ] obligations, the deficit of these -- renewal energy or like that.

So we also approach them. The government also approach us also. Now with the successful conclusion of this tender, now it's a very reasonable rate for INR 0.38 RTP. So now most -- we are getting -- receiving queries from the various discoms or state governments also. They are also keen to tie up power with us. So it's both ways. We contact them or they also contact us.

[Dhruv Muchhal, analyst]

Okay. Okay. And sir, how comfortable -- because 10 gigawatt is a very big number. I mean India as overall has never done more than 10 [ gigawatts ], but we're never able to find PPAs for that. So how confident are you that this 10 gigawatt annually can be done?

[Nand Sharma, executive]

We are very much optimistic because the energy, the capacity addition which has to take place in the new [ system ] depending upon the demand because now we are heading for an era that the energy demand is increasing. On the other hand, other than renewal energy, thermal and hydro, hydro projects takes a lot of time for the construction.

So this model of exclusive solar, exclusive wind or a hybrid solar plus wind or RTC is backed by battery energy storage system. So this is the best model for the state. It's the RTC power. It's the best model for the state. They need not to go to every year that we need power for the data, and we need power for the peaking time, we need power for some industry purposes. They get this assured power round the clock, then they get solution at a single point. So this model which we are going to adopt, so will be very, very catchy and will suit to all the discoms.

[Dhruv Muchhal, analyst]

Okay. So because most of your bids are RTC power, so I'm just wondering and RTC has to be designed for that particular state of demand. For example, 1,500 megawatts, I think, was designed for Punjab and [indiscernible], if I'm not wrong based on their demand requirement.

So you might be working -- before the tender is issued, you have to work with the state. Is that understanding right? And you're very sure that once the tariff -- once the bidding is done, the tariff will be adopted and PPA will be signed. Is that a fair understanding?

[Nand Sharma, executive]

It's a customized model. It's the customized model. Some states are customizing or some states are managing at their -- or planning at their own level. They know that they have this hydro power, they have the thermal power. Now they need only solar power. Or at some places, they don't have that capacity. They ask the agency only for that whole solution just to go for it. They need not to worry for that, and we are responsible to supply power RTC to them. So it depends on the state to state. Some states are planning and managing at their own level. And they are giving requirement exclusively, maybe solar or wind, or some states are giving us requirement for the RTC also.

[Operator]

[Operator Instructions] The next question is from the line of Rupesh Sankhe.

[Rupesh Sankhe, analyst]

Yes. Sir, what is the status of signing PPA for this Naitwar Mori or Arun-3? Why isn't Naitwar near to completion? So what is the status over there, sir?

And the second question is related to water sales, that charges has imposed by government of Himachal Pradesh. It's close to INR 138 crores. So is it going to be recurring or every time you have to pay these charges?

[Nand Sharma, executive]

Yes, Rupesh, regarding the PPA, Naitwar Mori, we are commissioning just in this month by itself. So we are tying up with -- we are in discussion with the different utilities also for the selling of this power.

On the other hand, initially, we are vying for a good option, good option. So if we are not getting a good option, we are free to sell it. We will plan to sell it in the exchange, initially exchange also. So we will wait for the right opportunity of right tariff, right agreement to sell this power. We are in discussion with -- the government of India is also helping us, which are the...

[Akhileshwar Singh, executive]

The J and K.

[Nand Sharma, executive]

J and K, Uttarakhand and other states, they are interested in it, that initially NDMC was also interested. So it is a question of rate, what rate we are getting, will be getting. And we will sign our PPA accordingly for 5 years, 10 years or 15 years. We will not go for long-term PPA. Long-term PPA is 35 years or 40 years. We will go for, say, 5 year, 10 years, 15 years depending on the price what we get. So this is regarding the PPA.

Arun-3 also, we are in discussions with the various parties. We have already signed MOU with PPP then ReNew also for the purchase of power. So other state governments are also interested. But whatever the commercial -- commercially beneficial rate which we'll be getting, we are all for that.

Regarding the water sales, government of Himachal Pradesh has [indiscernible], and that is already some [indiscernible] in the high quote also. So right now, we are not paying it. And this direction that government of India has decided that [indiscernible] we'll wait for the decision of the court also.

So government of India has issued the directions, some clarification with a component to levy the taxes. So the matters in the court, there were 1 or 2 hearings in that. And next hearing is in the month of December now, in the month of December. So we will wait for the decision of the court. Levy is a pass-through item. It is a pass-through item.

[Operator]

The next question is from the line of [ Mohit Surana ] from Monarch Networth Capital Limited.

[Unknown Analyst]

Sir, a couple of questions. Regarding REIA, the PPAs that we enter into, will those be long-term PPAs or just for 2 to 3 years?

And secondly, in the REIA model, is it only renewables that we can supply or it will be a mix of renewables and hydro? And can we supply our own generation under this model?

[Nand Sharma, executive]

First, regarding the PPA, that will be about 25 -- it's for 25 years. It is for the 25 years. And regarding the mix of energy, what we have actually said is that is solar, wind and battery energy storage. These are the 3 components.

[Unknown Analyst]

Okay. Sir, if you can also talk about the CapEx target for this year and next year as well? And how much you have achieved for this year?

[Nand Sharma, executive]

CapEx target this year was INR 10,000 crores. Right now, we have achieved INR 3,800 crores. What the first 2 quarters, quarter 1, there were -- in quarter 2 also some floods and some disruptions in the waterworks also. And most of the capital expenditure which is planned and expected is in the quarter 3 of -- mostly in the quarter 4.

So the module which we are going to procure for the solar projects which are under construction, 1,500 megawatt project, so most of the module will be supplied in the quarter 3 and/or quarter 4. So we are hopeful that this INR 10,000 crores will be achieved.

[Unknown Analyst]

So for the first half, it is INR 3,800 crores, that is what we have spent?

[Nand Sharma, executive]

Can you repeat?

[Unknown Analyst]

So for the first half, we have spent INR 3,800 crores.

[Nand Sharma, executive]

Yes, INR 3,800 crores, yes.

[Unknown Analyst]

And how much is the target for next year?

[Nand Sharma, executive]

Next year will be around INR 12,000 crores.

[Operator]

Ladies and gentlemen, that is the last question. I now hand the conference over to Mr. Rupesh Sankhe for his closing comments.

[Rupesh Sankhe, analyst]

Yes. So we thank NL Sharma, sir, for giving us an opportunity to host this call. We also thank all the investors and the analysts for joining this call. And Happy Diwali to everyone.

[Nand Sharma, executive]

Thank you. Happy Diwali to all.

[Operator]

Thank you. Ladies and gentlemen, on behalf of Elara Securities Private Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you.