Release Date: November 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- GPT Infraprojects Ltd (BOM:533761, Financial) successfully completed a fundraise through a QIP of INR175 crores, demonstrating strong investor confidence with a demand of 2.5x.
- The company achieved a significant reduction in debt by INR95 crores, improving its financial position and freeing up working capital limits.
- Revenues for Q2 FY25 increased by 27% year-over-year on a stand-alone basis, indicating strong growth in the company's operations.
- The Infrastructure segment, which accounts for 93% of total revenues, continues to perform well with a robust order backlog of INR3,372 crores.
- The company is now eligible to bid for projects above INR1,500 crores, expanding its potential market and growth opportunities.
Negative Points
- The consolidated EBITDA margin fell from 13.8% to 11.5%, primarily due to currency fluctuations in Ghana, impacting overall profitability.
- The order book decreased slightly from INR3,670 crores to INR3,610 crores, indicating a potential slowdown in order inflows.
- The concrete Sleeper segment's year-over-year sales remained flat, with challenges in increasing sales despite expectations.
- Currency translation losses in Ghana due to local currency volatility affected financial results, although these were non-cash losses.
- Despite strong financial performance, the market has not fully recognized the company's growth, as reflected in its stock valuation.
Q & A Highlights
Q: Could you provide an update on the current production status and contribution from the Ghana Factory to the Concrete Sleeper segment?
A: This year, we expect the Concrete Sleeper segment to generate approximately INR140 crores in revenue, up from INR95 crores last year. The Ghana factory is expected to start production in December, with revenue contributions of INR25 to INR30 crores anticipated in Q4. - Atul Tantia, CFO, Executive Director
Q: Following the recent capital raise, could you share insights into the current bid pipeline and any new orders secured?
A: We are actively bidding for large contracts, including those over INR1,000 crores. Post-QIP, we have the capacity to bid for projects up to INR1,500 crores, enhancing our ability to secure more contracts and improve cash flows. - Atul Tantia, CFO, Executive Director
Q: The consolidated order book has decreased. Are we seeing a slowdown in order inflows?
A: The order book decreased due to execution of INR290 crores and new contracts worth INR240 crores. We have secured over INR1,000 crores in new orders this year and aim for INR2,000 crores in total order inflows by year-end. - Atul Tantia, CFO, Executive Director
Q: The consolidated EBITDA margin fell. Is there a chance for recovery?
A: The margin decline is mainly due to currency fluctuations in Ghana. However, with contracts in euros, we expect stabilization once the Ghana factory is operational. The loss is mark-to-market, not cash. - Atul Tantia, CFO, Executive Director
Q: What is the company's long-term vision for revenue growth?
A: We aim to double our revenues to INR2,000 crores by FY27, maintaining an EBITDA margin of around 13%. This growth will be driven by both railway and road infrastructure projects. - Atul Tantia, CFO, Executive Director
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
