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Techno Electric & Engineering Company Ltd
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Ladies and gentlemen, good day, and welcome to the Techno Electric & Engineering Company Limited Q2 FY '21 Earnings Conference Call hosted by Asian Market Securities Limited. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Suraj Sonulkar from Asian Market Securities. Thank you, and over to you, sir.
Thank you, Janice. Good afternoon, everyone. On behalf of Asian Market Security, I would like to welcome you, everyone, for 2Q FY '21 Earnings Conference Call of Techno Electrical & Engineering Company Limited. We have with us today Mr. P.P. Gupta, Chairman and Managing Director of the company; and Mr. Ankit Saraiya, Director of the company, along with their finance and Investor Relations team. We shall start with the opening remarks from the management and -- about the quarter and outlook for the year. And then we shall proceed to Q&A session. Over to you, sir.
Thank you so much, Suraj, and a very good afternoon to all of you and wish you a very happy Dhanteras and Diwali. And welcome, everyone, to discuss our financial results for the quarter ending 30th September 2020, or first half of year 2021. Anything said on this call, which reflects our outlook for the future or that could be construed as a forward-looking statement, must be reviewed in conjunction with the risk that the industry carries and company faces. Half yearly results are not comparable on a year-on-year basis due to heavy impact of COVID-19, during the year starting March 2020, in the quarter. And we lost around 40 potential days in this quarter also and continues -- and still continues to be affected with local lockdowns and quarantine rules of different states. Let me highlight quickly our performance of the second quarter '21. The total revenue Q2 F '21 stands at INR 257 crores compared to INR 263 crores year-on-year. The revenue from EPC business stands at INR 223 crores, up by 9.6% year-on-year. Revenue for the wind segment was INR 33.75 crores. The wind revenue was lower as compared to last year for 2 reasons: the wind season started late, and it spilled over to October. But as of October end, the generation of 200 million is like-to-like. And also, last year, we had included a base payment surcharge of INR 23.51 crores. As per the regulatory order of the local regulator at CERC, namely TNERC in compliance to the terms of the TPS or EPA. EBITDA for the company stood at INR 75.32 crores in this quarter. Operating profit for the EPC segment for this quarter stood at INR 45.67 crores, up by 8% year-on-year. Operating profit margin for the EPC segment for quarter stood at 20.45% compared to 20.77% last year. The operating profit for the wind stood at INR 29.65 crores. Other income was INR 50 crores compared to INR 11 crores last year. It includes profit from sale of investment, namely Jhajjar KT Transmission, to IndiGrid. And we have a total profit out of this transaction, around INR 44 crores comprising INR 16 crores as dividend and INR 28 crores as capital gain. Profit before tax for the quarter was at INR 114 crores compared to INR 97 crores last year, up by 17%. And profit after tax for the quarter was at INR 96 crores compared to INR 90 crores last year, up by 7%. The EPS for Q2 stands at INR 8.67 crores.If we look on half yearly results, the revenue for this first half stands at INR 427 crores. Revenue from EPC is at INR 374 crores compared to INR 407 crores. We have been able to cover most of the ground -- lost ground rather despite lower revenue during the first quarter due to the challenges faced because of the COVID. And revenue from wind segment stands at INR 52.43 crores compared to INR 94 crores last year. Apart from onetime amount, which we received on account of TNERC Order is included. In the first quarter, the wind has started late, around June, which lasted up to October end, but the total power generated is more or less same like last year at 200 million, as of October end. At this stage, by the close of the financial year, we should achieve 230 million, as we did in last year. The tariff was down by around INR 1, but it is under appeal under -- at APTEL and we are hopeful of getting a favorable order.The company has availed the GBI benefits in full as eligible. There has been fall in REC pricing as explained in the last quarter, but we expect this to recover in the remaining part of the year. And trading REC is not happening since July 2020, which is expected to resume from this point onwards. EBITDA for the company stood at INR 119.66 crores. The operating profit for EPC segment is at INR 75 crores compared to INR 81 crores last year. The operating profit margin is at 20.06% compared to 19.93% last year -- year-on-year. The operating profit for wind segment was INR 44.55 crores, and this is at 84.97% compared to 91% last year. Other income for the half year stood at INR 64 crores compared to INR 24 crores last year. The profit before tax for the half year is at INR 160 crores, profit after tax stood at INR 132 crores. EPS for the first half is at INR 11.90 crores, 11.90. The current investment value within cash and cash equivalent as of year end -- as of September end stands at around INR 800 crores. The order intake did stay at -- stands at around INR 300 crores, but additionally, we are L1 at INR 200 crores, which will be converted into orders. And we also have -- we have L1 MoU with Power Grid to the extent of INR 350 crores, but it will be -- the outcome of the same will be subject to Power Grid winning the bid through TBCB route, under competitive bidding, which is scheduled in November, end of this year. We expect a larger business of the distribution segment and pollution control segment in generating plants to continue to be strong over other businesses of transmission. FGD segment, as per the notification of Government of India, all thermal plants needs to limit their NOx and SOx emissions to the acceptable levels. In our perspective, almost SEBs and private sector firms have yet to go ahead with the procurement of these systems. And this is almost about 80 gigawatt yet to be fitted. So we expect a business of -- out of this, around 150 billion in the next 3 years. And we will be targeting out of this business of no more than 5%. The overall plan for the government to implement in FGD system is still 123 gigawatt by 2024, which we expect, if missed, to be extended on request of the impacted entities. In the budget, FM has specified that the old thermal plants will be asked to shut down if their emissions are not as per the acceptable norms. We are bidding for 4 projects in FGD for about 6 gigawatt and hope to win at least 2 of them, during the current year. In the transmission segment, the business is, as usual, it is largely dominated by the evacuation of the renewable power, happening in Gujarat and Rajasthan. There is ongoing TBCB bidding process of 66 gigawatt out of -- which is out of a total target of 175 gigawatt, which is expected to be tendered out by June 2021, in full. Against the bid submission, dates have been extended till November. And so we don't see that the execution of these orders will happen during this year. But we do intend to bid for 4 projects in this category. We are seeing a good interest from large InvIT funds and also infra funds to take bids along with that in a partnership. This will enhance our access to the capital, and this will help us in bidding for more projects in the coming weeks. In the smart meter segment, business is growing strongly. The government's scheme is to install at least 200 million meters by 2024, which may again be extended by another 3, 4 years. In the current budget, Finance Minister of States and Union Territory to replace conventional meters by smart meters or prepaid meters, which will not only improve the health of the DISCOMs by containing T&D losses, but will also give consumers a freedom to choose the supplier and also to know how much power they have consumed or how much -- or they could plan their consumption as per their financial ability to pay. We should mention, especially project in J&K, there is inquiry which is already in the market for about another 6-lakh meters in the state of J&K. And also, there will be good potential in Northeast states. Apart from this, there are also reports in media that the reforms in the electricity sector are overdue. And they may be taken up in the winter session of the parliament. And we are finally hopeful that something happens in the -- under the disguise of Atmanirbhar Bharat scheme, now in implementation due to COVID. The attempt will be by the government to make the sector self-sufficient, free, provide open access to the consumers and also make tariff policy free of cross subsidy so that consumer is benefited usually and has a choice to buy power on competitive rates. The government has also extended subsidy of 1 point -- almost around $1.2 trillion to the DISCOMs to clear out the outstanding bills of the generators and transmitters as of September 2020. We are also hopeful of getting INR 136 crores from REC against tender quotings in this month. Regarding which segment, we are facing the headwinds, the regulatory headwinds in this sector, but DISCOMs are not having any money to play. This has not only impacted the tariff, but also timely payments. We are hopeful to realize our pending payments out of this $1.2 trillion package extending to PFC, REC out of this Atmanirbhar Bharat schemes. These dues outstanding are also part of the CEA website per provision and TANGEDCO has also acknowledged our views of INR 136 crores as of for the starting term. We are equally hopeful of receiving the delayed payment charge for the balance period post COVID and the necessary affirmative regulatory orders issuing our audit pipeline. And for the years up to 2014, we awarded and received Excellence.Additionally, CERC has modified the REC policy, but we have strongly contested in APTEL and are hopeful of getting these orders certified so that old policy continues for the next 2 years to come. So that our assured return out of REC sale is not initiated. In the first quarter of REC, prices has experienced correction due to oversupply by APSDCL of allocation of 44 meg nonsolar REC. But APTEL getting favorable order against our appeal has nullified this issuance. And as far as the supply side, it now stands very modest, which can be easily absorbed by market, as we're able to see the old rates back like last year. As committed in last quarter, we will be -- we are usually focused on recovering our performance of the year '18/'19 and shall be executing at least 50% of the unexecuted order backlog during this year, and we will see the growth in year '21/'22. In the coming years, we see strong power sector reforms with focus on efficiency, stable -- stability and reliable power supply, cost of power and improvement of our financial health in the sectors. The focus will continue to be more on renewable power with related transmission infrastructure as green corridors and we were the first movers in this segment. The transmission infrastructure will be required for 500 gigawatts or above over next 5 to 7 years. Our trust on overseas market is also bearing fruits. We are hopeful of bagging further orders from the markets of Africa and Afghanistan.With this, I will now request participants to open the session for questions and answers.
[Operator Instructions] The first question is from the line of Renjith Sivaram from ICICI Securities. As there's no response from the current participant, we take the next question from the line of [ Ankur ] from HDFC.
So couple of questions. One, just checking on your FY '21 guidance on orders and sales. So I think last quarter, you said you will be doing about INR 1,100-odd crores in the EPC business for FY '21 and close to about INR 1,500 crores to INR 1,600 crores of orders. Is that broadly intact now or any change over there?
Yes, it's perfectly intact in next -- now the full books -- given good season and good atmosphere. And believing, strongly, that COVID is behind us, we should be easily able to add another execution of INR 700 crores or INR 750 crores over the next 2 quarters without any challenge. Somehow, new orders are getting postponed, but we are very hopeful that all this will get decided before March end. So the order book should be there, but we were expecting some execution out of this order book, which seems now difficult. But order book of INR 1,500 crores to INR 1,600 crores is feasible. As I told you, we have, in this quarter, also booked a business of almost INR 200 crores. And we are L1 in another INR 200 crores, which is definite will be converted into order in this month. And additionally, we have MoU with Power Grid for INR 350 crores, where they will be going through TBCB process and -- if they happen to win this year. Generally, very competitive, very strong in the segment. This business will be back to back transfer to us. So INR 750 crores is no issue, unless business of FGD's, we are already a participant in the tenders, where price bid should happen in November, December. And we are very hopeful of getting a business of more or less INR 500 crores to INR 600 crores in this segment also before March end, similarly. And at least one more business in smart meter. So we see no reason why INR 1,500 crores to INR 1,600 crores should not be achieved. But definitely, we are hoping a little more, but conservatively saying INR 1,500 crores to INR 1,600 crores, which seems to be a reality as of today also.
Sure. So just to check, sir, what has been our order inflow in the first half of this year?
Yes, we got 2 orders, one from Sterlite Power for their Karnataka project in Udupi and another is for Ladakh from REC to set up substation in Ladakh area for power augmentation. So this INR 200 crores we have received already.
So sir, in value, how much is that in the first half, total value? I think you said INR 300-odd crores, is it, in your opening comment? Or...
No, I said INR 200 crores in this quarter.
In this quarter. Okay. Okay. Okay. Got it. Okay. Okay. All right. Sir, secondly, on the transmission side, you said there are some of these bids on the TBCB basis, which have been again delayed quite a bit now, I think you've suggested these may open in November. So what is the size of these bids in megawatt, gigawatt, overall? And what would be the opportunity on substations, which we are targeting? I think you said you obviously joined hands with Power Grid for about INR 350-odd crores, I think is what you said, if you could just clarify?
And we are -- as you see, there is another traction now in the market, depending -- looking on our strong drag and performance. And an InvIT and infra funds are directly keeping up with us. So that we also can bid directly as a developer along with them. So that on completion of the project, it will be part with them. So that is another additional opportunity. So we take double benefit out of it, that if Power Grid does not succeed anywhere, maybe we have been also along with them indirectly. So we'll definitely target TBCB which should be completed, to my mind, by no later than December end and this is a final time extension to our mind as even -- and we should be getting business of almost about INR 350 crores out of this. The total business in the bidding is happening for almost about INR 15,000 crores packages. And the power covered is about 50 gigawatts in this category.
Got it. Okay. Sir, secondly, on the FGD pipeline, are you seeing any delays either from NTPC or from state? I mean obviously, from the state and private side, it's already been quite debate, but NTPC, I think was targeting to order out everything this year. Is that broadly on track? And also on the state and private, are you seeing any pickup yet? I believe deadlines, obviously, have been extended by another couple of years. So how are things there?
Yes. You see, so far, we have seen more serious interest from CPSUs, like SCB, DVC or NLC. But we have not found more from the states and private players. I think now that -- now APTEL has already passed the order in August, where they have permitted this CapEx to be passed in the tariff that is a very positive order. And I'm sure all private sectors should pick up from there and they should be strongly in pick up market in next 2, 3 months. So we are -- we, as private sector, owns no less than 60% capacity in thermal power, as you all know, almost 10 gigawatt plus is in private sector or captive power sector. So all that market is used. Time line is always a question in India. We firstly aim that target date of no more than '19-'20 and extended to '24, maybe it will be extended by another 2, 3 years. But the program will definitely happen, that we are sure. However, we'll not relax any more SOx, NOx commitment matching or meeting. With some penalty, they may allow that population for another year or 2. But the government is serious to achieve it, maybe some more capacity goes out of the system. And maybe power reforms also enables more captive capacity to move to the grid with cross subsidies taken out of the system. So many -- reforms can do magic in this sector, let me put it. Many kind of roadblocks are there only because of the stupid regulatory regimes has followed in our country in power. That's why we could not be as efficient as telecom or aviation or autos. There is a good scope of it, let me put it. I think we are at the bottom of it. Anything happening in this sector will be betterment, I think.
Fair point, fair point. And just -- and just one last, yes, sorry.
I would like to invest in this sector...
No. Fair point, sir. Just one last question on the balance sheet and cash flows. I believe the total debtor is close to about INR 600-odd crores of which, I think, about INR 130 crores, INR 140 crores is wind's related. So if I heard you right, you're saying, at least on the wind side, you're hopeful to get the dues by end of November, right?
Absolutely. Yes.
Okay. So then what would be -- sorry, and what would be the number you're looking at by end of the year? Would it be back to around INR 500 crores, INR 550-odd crores number. Is that a number you're looking at on debtors?
No. For what? INR 500 crores for what?
Overall debtors. How would you see that by the end of the year by March? I know the top line will pick up again over the next 2 quarters. But do you think once you receive this money on the wind side...
It should be below INR 500 crores, sir, definitely or maybe even INR 450 crores, because today, INR 200 crores debtors are because of the wind or late payments, surcharge payments. So firstly, we are expecting energy bills payment and followed by late payments, surcharge payments, which has also been issued by the government now and approved by Ministry of Power that any late surcharge up to 1% per month is eligible. So good things are happening slowly, but implementation is starting, no doubt. We have to have patience, as usual. So I think the days ahead are good and better. That's what I'd say.
And last one, sir. I think there is a short-term borrowing there of about INR 46 crores sitting this quarter. Should that also go away? And what was the need for this borrowing?
Yes. Sir, we got this money at a very cheap rate against Afghani's supplies basically exports at 2% of the -- from the banks. So we hope that it's good money. We can make some delta out of it. That it also keeps our debtors manageable because they are against Afghanistan supplies, which we intend completing the whole package of INR 175 crores.As the disbursements are coming in time, they are all through letter of credit, funded by ADB. So there is no risk in respect to that, as such. So additionally, we have also got one more package in Africa from [Toubro] that is funded by L&T bank for $10 million. That again is a good project. So -- but execution may happen in the last quarter of this year, a part of it. Let me share a good news with you. We have commissioned COD, we have achieved for our Kohima project along with KPTL. The project starts commissioned today.
The next question is from the line of Sandeep Tulsiyan from JM Financial.
Sir, just wanted to first reconfirm the order book number. I think I heard a INR 2,300 crores at the end of September, if you could just reconfirm that number for me?
No, sir, the order now is roughly INR 2,120 crores as of September.
INR 2,120 crores. Okay.
There's L1 in another INR 200 crores.
Okay. And this, INR 2,100 crores is excluding all the L1 and the -- including the INR 200 crores that we have booked during the quarter?
Yes, absolutely. And these are the unexecuted or unbilled. We always declare unexecuted orders as unbilled orders. If some order is already partly billed that is taken as executed, not monthly unexecuted category.
Okay. And sir, second question is on the update on the Chinese partners that we had, which you were explaining to us during the last call for assuming that they have offices based out of the U.K. What is happening over there? Are there any restrictions put on future bids that we will make in conjunction with this partner? And also on the J&K smart meter project, as the...
Yes, it has definitely impacted us, partnerships with the Chinese parties. In Transmission, it is not impacting that much because it's a competitive bidding, and everybody is keen to have most of the suppliers and competition in place. But our smart meter partner, we could not retain. We had to change the partners. And we are back to our old suppliers for the outgoing project with L&T and CyanConnode. And we expect to complete this project now in next 1 years successfully. So that project definitely got impacted, firstly, because of COVID and then because of the Ladakh war. Government putting restrictions on use of Chinese equipment, particularly in the sensitive pockets of Jammu and Kashmir. But our relationship with that party is very strong. They have India subsidiary. They are technically highly competent and one of our leading ones. But simultaneously now we are developing partnership with a Korean company, called [indiscernible]. They are very good in these communication solutions. So we'll be able to rearrange our relationships so that we can continue to be competitive and be the healthy part of this business.
Sir, could you repeat the name of the partner, which we have replaced for the existing project? And will it lead to any kind of cost increases since we have switched the partner for us?
No. That is where the good thing happened, that we could, more or less, achieve the domestic suppliers on the same prices, more or less, markets have corrected a lot in the meantime. And they are very nearly in the same level as of Chinese level now.
And what is the name of the partner, sir?
Like, L&T. I said, we have replaced with domestic supplier called L&T on the meter side and company which we are going is CyanConnod. It's the U.K. company.
Okay. And sir, last question is one bookkeeping question. I think this was looking at the other income number. So we have given a breakup that we have INR 16 crores of dividend income and INR 28 crores of profit from sale of this asset. So roughly INR 44 crores comes from there and balance other income is only INR 3 crores. So is there any mark-to-market losses that we have booked because our cash balance was healthy INR 500 crores plus at the end of March, so why the first half other income X of the asset sales gain is so low?
It's not so low, you can say we are now conservative in recognizing the other income. And whatever we received in cash only is taken as income. We are not accounting the accrued income to be part of it. Maybe we'll do it by the last quarter and all which can recede by then. You can also take -- there is -- although, we expect no under recovery of our investments. But if any contingency happens like INR 5 crores, INR 10 crores, the same can be taken care out of this current other income only. So that capital account there is no adjustment required. So we will continue to monitor in March and be conservative in our reporting.
Next question is from the line of Rohit Balakrishnan from VRDDHI Capital.
Am I audible, sir?
Yes, you are very much audible, sir. Welcome.
Sir, just a few questions. So you mentioned to an earlier question that INR 1,500 crores, INR 1,600 crores of order inflow still looks possible. We still have to do a bit of heavy lifting in the second half, but you still think that's possible. Is there any chance that this number can get overshort and we can do much better than this now things are normalizing?
There's no guess so far, because the government is very good in labeling many initiatives. Yesterday, they announced many kind of stimulus. But implementation is very tardy. So I'd not like to bet on any betterment as of today. Maybe by another month or 2, we'll be more reliable. I think we will be able to ship more reliably. As of now, I will maintain that INR 1,500 crores, INR 1,600 crores, definitely, we are very -- feeling comfortable or okay to achieve it.
Okay. Got it. And sir, congratulations on, again the COD for Kohima project. So on the sale of that, we will get clarity in a couple of months, whether the CLP...
Is there or not, we will have the clarity by December end -- before December end, sir. Kalpataru, IndiGrid initiative and definitely...
Right. Right. Right. They were pretty confident that -- in their con call, they mentioned that they are confident that it will go through with the current buyer only, with CLP only. But just, sir, in -- if there is any contingency, do we think that we can sell -- I mean there are other interested parties there, just to get a sense?
Absolutely. Where we saw interest in from [ InvIT, Adony, Atlanty], all are very keen to be part of this asset. At least they want to be part of it. This is very strong asset, let me share with you. Someday, we would like to take you to [indiscernible] in Nagaland and show you that the best of the India substation can be built in such a remote pocket.
Sure, sir. Sir, also, just wanted to understand -- actually, last 2, 3 con calls, there has been a lot going on in [ the wind. ] And I'm sorry. You've explained it well, but somehow I've gotten confused. So REC sales have been -- I think they have been [ stopped ] because the prices have fallen and there's no trading. I think that's going to start from this year -- from this month. But in general, apart from the -- there have been a couple of issues that are there where we have also gone into litigation. So if you can just summarize then in brief, it will be really helpful. I'm actually sorry because you've explained it well, but I have not understood it that well.
So there's very long history of [Palantir on ] board. If you visit us on one-to-one basis, it will be better because explaining on investor conference, we'll be taking away the rights of many others.
Fair enough, sir. I'll reach out to you and maybe over a call...
We have full control of the situation. We understand the nation better than many other businesses. And we'll be able to survive successfully and honorably. But trading has definitely not been happening in July because of certain issues created by [indiscernible] or the floor [indiscernible] supplies. I don't want to name under whose lobbying, but it did have lobbies are working strongly, [maybe] it should be offline. But I can assure you that on the merit of the grounds of the case, we have a very good case after. We are very hopeful of achieving [ a very favorable] order and life will continue as well.
Sure. Sir, just 2 more questions. One, so this -- on this DISCOM release package, we will receive -- have you started receiving money or we have yet to receive?
We are yet to receive, sir. At the moment, the Techno was the last because they were needing certain concessions in the norms given by the government under that scheme, which cabinet cleared only as late as September. So I think by next week, a list of the vendors to use our [ vending ] will be handed over to [indiscernible] And thereafter, we think that we will have gotten, they should be able to pay all of them. The trend will go as sanctioned. The largest payout of INR 1.2 trillion, almost 25% of it, that is INR [30,350] crores. All of you may already read the media reports. Same amount is under discussion now through [indiscernible] office.
Sir, you'll make 1 bullet payment of INR 170-odd crores?
Absolutely, sir. There'll be 2 parts, 2 parts we [indiscernible] .
Okay. So sir, this brings to my last question, sir. So now, right now, we have about INR 800 crores of cash and then another probably EUR 170 million from your end you'll generate also to our business. So more than INR 1,000 crores of cash will be on our balance sheet. This is a great asset in this time. So we have already declared a INR 3 dividend, but just wanted to understand what is our thought process. And sir, one suggestion I had is given the stock price and the valuation and the [ state ] of our business and balance sheet, if you can probably consider buyback because I know buyback is -- we will pay 20% ex tax, but dividend in the hands of shareholders is anyway taxed at marginal rate. So that's for an individual investor or an investor, that difference is not much. So I want to understand, one, what is your thought process on tax? And second question is -- second suggestion sort of is that if you are thinking of distributing or any other things, then maybe we can also consider buybacks given the very low share price, very low valuation that we have.
Yes, absolutely. We are working on various models, including buyback. And post set of this money from [Vendco]. Within a month or 2, we'll come out with a specific solution as to how we want to reward our investors. It will be significant reward as permissible in the form of buybacks or maybe some other form, like convertible debentures or something at 0 cost, something we'll come out with as permissible under the law. So we will -- we have engaged a consultant for this who's working on it. So we'll issue report, and we'll be shortly coming back to you within 2 months with a corporate solution or earlier.
Right. And sir, so I mean -- so you're saying you will -- but we'll still be left with a significant amount of staff. So just want to understand what is the thought process, not immediately, but maybe for the next couple of years, what are we thinking to -- where we see opportunities? Because you've also talked about reforms in the past and that can throw up opportunities as well.
That is what we are eagerly awaiting, sir. So let this -- what Minister is now saying that more or less, he will be [indiscernible]. So we will see the distribution of DISCOMs undergo reforms. They give us an opportunity to be partner with the government in privatization process. Otherwise, also, we are evaluating some value-added opportunities like data centers. It's a power-centric business. At the moment, more and more people in realty are coming in it, likely on [indiscernible] is keen to be part of this segment. So this is another segment [ which is also revenue slice]. But real capability lies with Techno, building it and operating it. So this is another segment under evaluation. We have used a new consultant, which is one of the 4 multinationals to give us a business plan in this segment also. Let's see. The money is -- to have cash in things, sir, it is always very helpful. We will definitely generate healthy and value-added opportunities to deploy it.
Congratulations on very good numbers.
The next question is from the line of Keshav Garg from CCPL.
I just wanted to understand your plans to divest our wind assets. I think since past, over 2 years, we have been trying. And until the case with Tamilnadu State Nextcity Board is going on. So sir, you think that at the same time still go through or we have to wait for the litigation to finish first?
Yes, we are working on the alternative modes of sale of this [ favor] either through third-party mechanisms or maybe becoming an attractive use of this power by creating some facilities there. So we are looking on it seriously. The question is that you get a right asset when you own the business is [indiscernible]. Unless the revenue stream is healthy, then no asset value remains healthy. It's on back-to-back business. So at the moment, this sector is facing some headwinds, unfortunately. We have a [ consumer ] [indiscernible]. So we will be able to fix it by end of this year [indiscernible] And then we'll talk alternatives to how to make the power [ back online ] again. So we have to realize no less than [ INR 5 per unit ] as we have realized for about 7, 8 years. So that is our goal post. So I cannot tell you the exact mechanism which we may succeed, but we will be able to achieve that value and then look on the sale of asset.
Okay, sir. And lastly, sir, I just wanted to repeat what the previous speaker said regarding the share buyback is a more superior and tax effective way. And sir, moreover, sir, even this bonus debentures, it's a one time thing. The cash goes out of the company, and that's the end of it. So the share buyback number of shares [ equities ] come down, ROE and [indiscernible] goes up. So in my humble submission, sir, that's the best option, sir, you are the best person to judge.
Thank you for your suggestion. We'll keep this. We are also seriously considering buyback.
The next question is from the line of Renjith Sivaram from ICICI Securities.
Sir, I'm on the connection or disconnected? Hello?
Yes, Sivaram.
Hello?
Yes. I'm able to hear you.
Okay. Sir, I just wanted to get your outlook regarding the growth for this year. What kind of revenues you are looking at and what will be for next year?
No, for which year, current year or next year?
Current year and next year.
This year, we are, as we have guided, we will definitely achieve a top line of INR 1,100 crores to INR 1,200 crores, as we have been always maintained it. Next year, we'll definitely be growing by no less than 25% [if only the government -- ] given the government life policies and initiatives has implemented, many clients announce more than the increment. But I hope that it will be over by the end of this year. So next year, it should be a lot more healthy for us. No doubt, growth should have happened this year. But because of COVID and the resulted impact of the government [penalties] this will roll over to next year. So we should be able to see a growth of 20%, 25% next year [indiscernible]
Okay. And how much will be the order intake for this year, which we are targeting?
INR 1,500 crores to INR 1,600 crores, sir.
INR 1,600 crores.
INR 1,500 crores to INR 1,600 crores.
Okay. That's great. Sir, just last 2 quarters, our EPC margins have been very good, and we are happy about that. But just wanted to understand is there any particular one-off inside that? Or what will be the -- will it normalize to 15% going forward? What was the start price element in that EPC margin?
Sir, it is -- I was always maintaining that we will be having a margin of no less than 15%, 16% on an annual basis. We are demonstrating it uninterruptedly for the last 10 years despite concerns of investors -- prudent investors like you. And definitely, this quarter is a little better because of our supply [indiscernible] and the rupee depreciation. So it has actually risen a little more.
Okay. So there is no one-off [ purpose ] in that, or EBITDA margin?
Not at all. Only one-offs applying to the bottom line, but not in the margin.
Okay, that's great. And sir, like this part meter now we are collaborating with LND, but in [general we ] generally compete with LND. So how does that work then?
No, LND is no more LND, sir. It is Schneider. So it is Schneider over there. Many things have changed in the market, as we have used relationship with Schneider, they are not into [ present] industry [indiscernible] but they want to pocket more [indiscernible] for us. And secondly, this market will also move to OpEx, CapEx or what order has been set by power from the government. So we think companies like us will have a strong presence at this time.
And how much is our outstanding? Last quarter, we sold outstanding of INR 150 crores from TANGEDCO. Is that share remains or have they paid up something?
They have paid up nothing, sir. That money will be paid in this year -- this month,sorry. So now only they are processing the [indiscernible] and they're handing over to us for [indiscernible] the case.
So what's outstanding currently?
We have a total outstanding of [ energy fees]. Other than [ base] are [ charge fees]. The [indiscernible] alone is about INR 162 crores.
Okay. That is over and above INR 150 crore.
No, no, no, the INR 50 crore -- the exact number is INR 164 crore, plus less than [indiscernible] another INR 150.
Okay, okay. So we are confident that by this quarter, we should get this?
Absolutely, we should get INR 160 crores at least.
Okay. And we are -- regarding the Kohima project, what is the deadline that we are currently working?
Today, we have achieved the CoD sir, And now you've got to add 6 months year after, within which we should get our money. So it should happen. The cash should be relied around first quarter of the next year. But it will be very good. As the process is read by that, there will be more [ happening] on these sites.
Okay. And sir, we had some investments and some bonds. And last quarter, you told we have reduced the bond exposure to INR 30 to INR 40 crores. What is the current exposure to the bonds?
Yes.At the moment, it is no more than INR 200 crores now, which includes INR 40 crores new exposure, and INR 160 crores is old exposure now.
So is there any risk for or risk of any write-off in those investments, please?
No, sir. Not at all. We are very confident to get all the money. We are getting around INR 25 crores, INR 30 crores per quarter, which we got in this quarter also. And that is now -- we have come down to INR 150 crores. We hope that by March and it will be more than INR 100 crores.
Okay. That's good to hear. And sir, we would like a special dividend from you because thereby, we will be giving more money to us rather than the government. So in that aspect, it will be great that it gives a special dividend rather than a buyback.
People have different views. But your view is taken. Okay, sir.
The next question is from the line of Mayank Bhandari from B&K Securities.
I just wanted to understand INR 1,500 crore of -- INR INR 1,500 crore, INR 1,600 crore of order intake in H2 -- sorry, for the full year, what would be the composition of this? Like, you have highlighted INR 500 crores INR 600 crores from TBCB and another INR 500 crores, INR 600 crores from SEB. And what would be the rest?
And INR 200 crore will be smart meters.
And INR 200 crore will be smart meters.
Yes, we have one more order of smart meter, sir.
So the last 2 quarter, you had a steady INR 500 crores from smart meter [indiscernible] And for STATCOM orders?
STATCOM is a part of TBCB now, sir.
Okay. So to this, so you had highlighted like INR 500 crore from TBCB includes STATCOM?
Yes, absolutely.
Okay. And did the 2 FGD orders of about [ INR 750 crores come in ]?
Right, right.
Okay, okay. And sir, just the real question like, what would be the -- see, right now, if I have about INR 1,500 crores of the inflow expecting in FY '21. So I would probably be ending my -- on FY '21 by order book of about INR 2,500 crore or?
Yes, INR 2,500 crores, INR 2,700 crore are approximate.
The next question is from the line of -- will be Rajesh from Manan Capital.
My first question was regarding the wind mill. I agree with your comments about waiting a little bit. But do you have a -- some time line in your mind as to when we like to monetize it by?
Sir, we are, at the moment, as I told you, the wind business is facing some headwinds, and we are busy resolving it. And for instance, regulatory authorities, some orders are awaited at that level, both in terms of the past tariff as well as the REC pricing. So both are [inept] at the moment. So that is what is expectation. And second is that we are also at the waiting the payment from the [centerco] with this out-of-paper scheme of [indiscernible] which is another around INR 150 crore, which we should get in this one. And that late payment charge, we have to collect about INR 50 crores, INR 60 crores. So once we have done with all these headwinds issues and realize these newer price out of the wind power and not skewed down -- not the skewed value as of today, that only asset will have a right value to dispose of it. In the mean time, we are also exporting to get out of the PPA from the TANGEDCO and get it to third-party sale or our own captive power consumption. That is how we are exploring, that how we can make this power more valuable to us and then exit the capacity to some investors.
Right. And sorry to press you on this point. So your sense of timing is, let's say, next 3, 4 quarters? Or do you think it could be longer to resolve all the issues you have just highlighted?
I would trust it would be no more than 4 to 5 quarters.
Four to 5 quarters. Okay. And if I may, I would suggest that you should think about doing a buyback for the simple reason as one of the previous speaker said. Your number of shares will go down, your EPS and return ratios will look better, and obviously, you will, as a promoter, should be able to increase your stake in the business as well. So rather than giving out special dividend, we like this business, and I think it's better to do a buyback.
Thank you so much. We'll keep this in mind, sir.
The next question is from the line of Rohit Balakrishnan from Redi Capital.
Sir, most questions have been answered. Just one small bookkeeping question. I couldn't understand this. Sir, in your other income stand-alone, other income is greater than the consolidated other income. So INR 56 crores versus INR 150 crores for this quarter in stand-alone versus INR 34 crores. And I think in the notes also, you mentioned a dividend from the subsidiary, which is where in stand-alone and not there in consolidated. So I just wanted to understand this, what is the -- I mean just a bookkeeping question.
Bookkeeping on the shelf. As you all know, that a subsidiary whenever makes a profit, you have some reserves in the subsidiary created over time. At the [industries, ] you are required to value your investment in subsidiary of the very market value or book value of that stock. So it is only a difference of the face value versus the book value what is market value, as you have realized. So in case of that stand-alone, it is face value versus market value. In case of subsidiary, it is book value versus market value.
The next question is from the line of [ Vikash Pet from Chupta Business].
I get the feeling from all the institutional investors that they're looking for a buyback or over dividend because of the worry on the lower share prices for a very, very long time. But I think fundamentally, the money is invested into the business, probably that gives a long-term growth and reward for the investor. How are we looking at putting the money in the business apart from the buyback or dividend that you may be considering?
Absolutely. You see, we are also keen to at the moment bidding in TBCB is extremely aggressive between [power grids and money]. So we don't want to get into a space which is beyond viability, long-term viability space, number one. But we will keep scouting good opportunities to invest in this space. We are experienced. We understand the space better. So we are partnering with some kind of funds, intra funds, [indiscernible] funds where we directly develop for them now that they are buying from the secondary market. So that is one way so that we continue to [ top off our line ] and also continue to invest in this market. Additionally, as I shared with you that we are also exploring the opportunity given the power sector reforms, that how we can strongly be part of the DISCOM business because I think that is the last mile relationship between consumers and any distributor like telephone or like aviation. So we want to be part of B2C, not B2B, which remains very different. So if any kind of that relaxation or reform [ in sector efforts ] by way of amendment to electricity has proposed, then it will become a huge opportunity for us to invest going forward. Additionally, we are also evaluating power that [indiscernible]
And I think we have a large number of institutional shareholders. So they are just a diversified in terms of share valuations, and I hope we can do a good buyback or a dividend, so that at least, they are -- their patience will be well rewarded.
Absolutely. We would like to keep -- Although you are the people who create value in the marketplace, and we don't want to be market participants at all in [ any professional -- in any manner. ] Our professional, I understand my business and how to generate best return out of my business. Market valuation is to be created by you people. So I look at you to -- but we can assure you that we will do the justice in using the surplus money for the benefit of investors.
Thank you. Well, ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to the management for their closing comments.
Yes. Thank you all for joining the conference call with us. It has been a pleasure to answer your queries, [indiscernible] with our outlooks. It gives us a very huge satisfaction of your ownership and appreciating the way the company's performing [ ability ] to its investors, shareholders, stakeholders. Still, in case you have any query related to our performance, please drop a mail to us. And if you happen to be this side of India, you are welcome to our office to experience how we really work and do the projects different than others. With this, I would like to close the conference and thank everybody for joining. And again, wish Happy Diwali. Thank you so much.
Thank you. On behalf of Asian Markets Securities, we conclude today's conference. Thank you all for joining. You may now disconnect your lines.