Ladies and gentlemen, good day and welcome to HFCL Q2 and H1 FY 2025 Earnings Conference Call, hosted by ICICI Securities. Before we begin, I would also like to read the disclaimer statements. Statements made during this call may be forward-looking in nature, based on management's current beliefs and expectations. They must be viewed in relation to the risk that HFCL's business faces, that could cause its future results, performance, or achievements to differ significantly from what is expressed or implied by such forward-looking statements. Investors are therefore requested to check the information independently before making any investments or other relations. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing * then 0 on your touch-tone phone. Please note that this conference is being recorded. I now hand over the conference to Mr. Mohit Lohia from ICICI Securities. Thank you, and over to you, sir. Yeah, hi. Thank you, Palak. Hi, good afternoon, everyone. Thank you for joining us today for Q2 and H1 FY 2025 earnings call of HFCL Limited. First of all, I would like to thank management for providing us the opportunity to host this call. From the management side, we have Mr. Mahendra Nahata, Promoter and Managing Director, Mr. V R Jain, Chief Financial Officer, Mr. Manoj Baid, Company Secretary, and Mr. Amit Agarwal, Head of Investor Relations. So, without further delay, I would now hand over the call to Mr. Nahata for opening remarks. Thank you, and over to you, sir. Thank you, Mohit. Good evening, ladies and gentlemen. I'm delighted to welcome you all to HFCL earnings call for the second quarter and half year of financial year 2025. I trust that you got a chance to go through our financial results, press release, and earnings presentations, which are available on the website of the company and also on the website of the stock exchanges. Friends, India's digital infrastructure is advancing rapidly in order to support the country's accelerated development expectations with the deployment of 50 lakh kilometer optical fiber cable, 70% towers to be fiberized and village connectivity. The acceleration in 5G monetization, the initial thrust of 6G globally, Industry 4.0, hybrid scaling of data centers, increasing smartphone adoption, and BharatNet Phase 3 are some growth drivers of the Indian telecom industry. Artificial intelligence and machine learning are reshaping the telecom industry, with GSMA estimating these to be $680 billion opportunity over the next 15 to 20 years. Additionally, implementation of fiber-to-home globally and the PLI Scheme alongside initiatives of promoting semiconductor manufacturing in India will fuel long-term growth and encourage indigenous manufacturing. We recently participated in the annual India Mobile Congress 2024 held in New Delhi, which is a premier exhibition in the telecom space. HFCL launched two revolutionary unlicensed band radio products at this exhibition. These include 1 gigabit per second small form factor unlicensed band radio and 2 Gb per second point-to-multipoint unlicensed band radio, designed to meet the growing data demands of modern networks. With over 5 lakh UBR deployments across India, the U.K., Europe, the Middle East, and Africa, these made-in-India solutions deliver fiber-like speeds at a fraction of the cost of conventional wireless backhauling methods. With power efficiency and significant CapEx and OpEx savings, our new UBRs, paired with Unified Element Management System, represent a leap forward in last-mile connectivity, reaffirming HFCL leadership in 4G and 5G wireless backhauling solutions. With an aim to continue our market leadership in this space, we are making high technical advancements in our new range of products while offering cost-effectiveness to our customers. It gives me great pleasure to inform you that HFCL has successfully deployed one of the world's largest advanced broadband network gateways with control and user-plane separation architecture for BSNL. This enhances network efficiency, delivering superior high-speed data for fiber-to-the-home and enterprise applications, significantly boosting capacity and reliability. Additionally, this deployment will serve as the internet gateway of BharatNet projects, supporting 2.5 lakh gram panchayats. As a trusted BSNL partner, we look forward to further collaborating with BSNL, while HFCL playing a key role in BharatNet Phase 3. India's defense sector holds a lucrative opportunity of $130 billion market over the next decade, amid the escalating demand for defense equipment, technology, and services, offering significant prospects for companies engaged in defense technology development and manufacturing. The quarterly review has been crucial for HFCL in demonstrating its defense capabilities and entering strategic partnerships with global players. One such significant development that underscores HFCL's technical prowess and commitment is that the company has been selected to develop and supply critical subsystems for General Atomics Aeronautical Systems Incorporated of the USA for their advanced unmanned aircraft systems. This partnership marks a milestone in HFCL's journey as it becomes a key contributor to one of the world's most sophisticated unmanned aerial vehicles. Further, in line with the Atmanirbhar Bharat Abhiyan, HFCL has indigenously designed and developed various cutting-edge defense technologies, including electronic fuzes, thermal weapon sights, thermal cores, and ground and coastal surveillance radars for various ranges and applications, high-capacity radios amongst others. The geopolitical situation presents India with new opportunities to expand its role in the global defense industry. With strong R&D capabilities, HFCL is positioned to tap into both domestic and international defense markets. As mentioned in the last call, we have successfully initiated the field trial of our several variants of radars during Q2 and expect to make it commercially available from Q4 FY 2025 onwards. We have also been shortlisted to participate in the tender for modernization of infantry combat vehicles of the Indian Army. The broadband industry is gearing up for 2025, and we anticipate a lot of fiber deployments. We anticipate an acceleration in fiber-to-the-home demand in USA post-elections, and new governments likely focus on Build America, Buy America, and Broadband Equity Access and Deployment programs. To meet these rising demands, we specifically designed and developed a product line for the U.S. market consisting of high-density single-jacket, single-armor, intermittently bonded ribbon cable with 144 to 1,728 fibers, for which we engaged, and that's the ISE Network Innovators Award. HFCL also expanded its award-winning nano-thin product line of loose tube micro cables of 10.6 diameter consisting of 864 fibers. With these innovative cable solutions, HFCL will cater to changing demands for network deployment driven by growth in data centers, metro networks, and FTTX in North America. With the U.K. being another key global market for HFCL, we showcased our comprehensive range of sustainable products. These offerings will enable U.K. operators to connect customers more quickly, cost-effectively, and sustainably. These new additions will further expand HFCL's extensive optical fiber solution portfolio, paving the way for advanced fiber infrastructure and faster broadband rollout in the U.K., targeting Building Digital U.K. initiative. Further, in order to meet the growing global demand and increase revenue through expansion in international markets, HFCL BV, a wholly-owned subsidiary of HFCL Limited in the Netherlands, has established a wholly-owned subsidiary company named HFCL U.K. Limited in the U.K. Incorporating a company in the U.K. will enable the company to cater to the demand in the U.K. for its products and expand its business operations there. This move aligns with the company's strategy to increase revenue from export markets, augmenting its presence and foreseeing growth opportunities. We are targeting a significant increase in export revenue from our optical fiber segment, aiming for up to 70% of revenue to come from international markets in the next three years. Additionally, we plan for 40% to 50% of our telecom segment revenue to be export-driven within the next three years. The European Commission with its verdict given on 11th October 2024, and it exempted us from definitive anti-dumping duties on optical fiber cable, by which we have gained a competitive edge in the European market. We are now focusing on expanding our fiber and telecom business in North America market in a major way. Apart from our cable solution, HFCL has emerged as an end-to-end solution provider by increasing its business and market share for passive connectivity solutions for optical fiber cable networks. On the back of its massive growth potential, HFCL expects to grow passive component business to INR 750 crores in the next two to three years. Moreover, BharatNet presents a significant opportunity for us. BSNL has already floated a tender for approximately INR 65,000 crores for capital expenditure over the next three years, followed by an expected additional INR 40,000 crores for operations and maintenance over 10 years. Funded by the Government of India through the Universal Service Obligation Fund, the BharatNet Phase 3 project aligns with HFCL's core strengths, boosting demand for optical fiber cables, accessories, telecom and networking products, system integration services, and O&M annuity revenue. HFCL's integrated manufacturing capabilities, extensive experience in laying over 2 lakh kilometers of optical fiber cable, and end-to-end solution positions it well to secure a substantial share of this opportunity. HFCL has already submitted bids with a technical evaluation in advanced stage. We expect the fiber market to revive from the first quarter of fiscal 2025-2026. We are seeing signs of recovery as more tenders and inquiries are coming up nationally and internationally. Our total order book now stands at INR 6,151 crores as of quarter two of financial year 2025. Friends, let me now brief you on the key performance metrics for Q2 of FY 2025. Revenue of Q2 FY 2025 is INR 1,094 crores as compared to INR 1,158 crores in Q1 of FY 2025 and INR 1,111 crores in Q2 of FY 2024. EBITDA for the quarter is INR 172 crores as compared to INR 185 crores in quarter one of FY25 and INR 150 crores in quarter two of FY 2024. EBITDA margin stands at 15.71% for quarter two of FY 2025 as compared to 16% of quarter one of FY 2025 and is 13.47% in Q2 of FY 2024. For Q2 of FY 2025, profit after tax stands at INR 73 crores as compared to INR 111 crores for Q1 of FY 2025 and INR 70 crores in quarter two of FY 2024. PAT margin stands at 6.71% in quarter two of FY 2025 as compared to 9.55% in Q1 of FY 2025 and 6.31% of Q2 of FY 2024. Segment revenue for telecom products during the quarter end stood at 46.46% as compared to 61.42% in Q1 of FY 2025 and 42.63% in Q2 of FY 2024. In conclusion, India stands at the brink of transformation with the rapid rise of artificial intelligence and other cutting-edge technologies. This presents a significant opportunity for organizations like ours to innovate and drive this change. We remain committed to R&D and expanding our product portfolio across telecom, defense, optical fiber cable, and passive connectivity solutions to capitalize on future opportunities. Our growth will be powered by a strong order book with robust order pipeline, execution capabilities, capacity expansion, backward integration, customer-based growth, and entry into new markets, all driving revenue growth, margin improvement, and efficient use of working capital. Thank you, ladies and gentlemen, for your continued support. Thank you very much. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Chandan Mishra, an individual investor. Please go ahead, sir. Sir, good evening, sir. Thank you for giving me the opportunity to ask questions, sir. My question is related to, sir, execution of order. As we have seen very less in quarter two compared to last year, whereas we have large orders, that is INR 6,151 crores. First question is, what is completion for this order? And secondly, sir, you have also guided for 25%-30% for the next few years during the last phone call. So what causes this less execution in this quarter, and can we expect this to ramp up in the next quarter? Mr. Mishra, I could not understand your question properly. Would you please repeat them? Sir, my first question is, we have an order book of INR 6,151 crores. What is the completion time for this, sir? Okay. And the second, second question is, sir, during the last phone call, you have guided for 25%-30% for the next few years in revenue. So what causes us this less execution in quarter two, and can we expect this to ramp up in the next quarter? Yeah, Mr. Mishra, the INR 6,151 crores order, out of which roughly about INR 1,500 crores - INR 1,800 crores of order is for O&M, which should continue for the next five or six years. Rest orders, which are roughly about more than INR 4,000 crores, are to be executed in the next, let us say, 12-18 months' time, sir. Sure, sir. As far as growth is concerned, you know, we are very sure about the overall growth of the company. Quarter to quarter, it may differ because of the market situation. For example, fiber optic cable market has been very depressed worldwide since the last about three quarters. So you would see the fiber optic cable revenue of every company in the world has gone down drastically. So we cannot be different than the worldwide situation. So fiber optic cable demand has gone down, and revenue has gone down from that. Now we are seeing that the fiber optic cable market is coming up again in India and abroad. So the growth will come back into the market and the company also. So overall, I really believe, very bullish with the growth opportunities, not only from telecom but also from the defense sector also, for which we have got several products which are under trial, which are getting approved one by one. And once the commercial marketing of these starts, which we expect to start from either the end of this financial year or the beginning of the next financial year, that revenue will also come up. We have a strong belief in the management. The growth of the company would be on track, except sometimes the fiber optic cable situation comes up where the growth of that particular segment goes down. But as I said, this is also coming back now. And from the next quarter onwards, we see the fiber optic cable market is going to come back to the better situation than what it is now. Sir, then can we expect, as per your last phone call, which we have guided, you have guided for 25%-30% growth in revenue. That is except excluding from-- In three years' time frame, we should reach to something like INR 10,000 crores of revenue. And I quite believe that we should be able to do that. As far as the current year is concerned, we are on track of our revenue projection, except in fiber optic cable business, which helps in the downtrend, which was not expected to that level of downtrend in the fiber optic cable market by any company in the world. So as I said, we cannot be different than the other companies in the world. But again, this market is now improving. So as far as our growth is concerned, except fiber optic cable market, which is the market situation worldwide, we are on track to reach to the numbers which we have thought of. Sir, that means this year will be like subdued revenue due to optic cable slowdown? No, I am not saying it would be subdued. In the case of optical fiber cable, it may be subdued. Resting, we are not saying it is going to be subdued. Sure, sir. Thank you. Thank you, sir. The next question is from the line of Manish Ostwal from Nirmal Bang Securities Private Limited. Please go ahead, sir. Yes, thank you for the opportunity. My question on both the BharatNet and the BSNL opportunity in the domestic market as well as the international market. You said your initial remark, the inquiry and pipeline is very, very strong. So first, what is the size of opportunity both with respect to BSNL as well as BharatNet for us in the next two to three years, and how much order we can visibility have on the domestic market? And secondly, international side, we have a lot of capability built over time. And now, when we can see a meaningful order inflow for us to have a sizable revenue from the international market at a consolidated level? Mr. Ostwal, thank you very much. Very good question. Fiber optic cable market, up to last year, it was doing very well. Then all of a sudden, because people had built up stocks, operators, and everybody, and offtake could not take place as much as expected, so finishing of stock was what was going on. Now what has happened, we have started seeing that those stocks have gone and new opportunities have come up, and the operators are coming up with the new tenders, new inquiries. Now, as far as opportunity size is concerned, BharatNet itself presents an opportunity of roughly about the present tender, and then some more tenders are to come from the different state governments, which are implementing the BharatNet Phase 3 by themselves rather than through BSNL. Total demand, I expect, is about going to be 20 lakh fiber kilometers. Now, you more or less, more or less, it may be a little bit less, a little bit more, you multiply it with INR 1,000 per fiber kilometer. That is going to be the opportunity for fiber optic cable in the next three years, just BharatNet alone, BharatNet alone. Apart from that, for the private operators, I see other opportunity on a yearly basis of roughly about, I would say, INR 700 crores-INR 800 crores of private operators' opportunity in the Indian market itself. This is the, as far as Indian market opportunities concerned. Now, coming to international market opportunities, total market opportunity, I am excluding China from this. I am excluding China from this because China fulfills its own demand and it doesn't come out. The total market opportunity is roughly about 350 million fiber kilometers, which has gone down by some 23%, 20%, 30% last year, which is going to come back to roughly about 350 million fiber kilometers. That's going to be the opportunity for the international market. Again, roughly multiplied by INR 1,000 per kilometer of fiber, that's going to be the total market opportunity for fiber optic cable. Now, as far as HFCL is concerned, we are concentrating on the Indian market, where we right now have almost 50% market share. With BharatNet coming and these private operators reviving their fiber optic cable requirement, I believe that should be a strong year for us in the fiber optic cable business, which this year was not so strong for two quarters because of less demand worldwide. As far as international market is concerned, our concentration is in the European market, where we have got good opportunity because we have not been imposed countervailing duty as others have been. Chinese suppliers have been, so we have a competitive edge. And now we are concentrating quite a lot on the U.S. market also. The U.S. market is also coming up with a very big demand for fiber to home that government incentives being given. We are concentrating quite a bit on the U.S. market also. So what we see that starting from the fourth quarter of this financial year, this market of fiber optic cable would pick up significantly and will come back more or less to the old levels which it was. Okay. Secondly, sir, on the margin side, since our product revenue is you indicated the product revenue will increase over the medium term. So current margin, which is H1 number, is 15.86%. So where do you see the medium-term margin settle down or even for the full year of 2025? What is your guidance on the margin side? Manish, your voice was muffled in between. I just please say, what did you say? Margin? What? Your voice was muffled. Can you just bring the microphone near to you? Yeah, yeah. So my question, sir, in the H1 of 2025, we have reported a big margin of 15.86%. The question is, since we are increasing our revenue from product side over the medium term, so that will have an impact on the margin. So where will the margin settle down over the medium term? That's the medium-term question. And the short-term question is, for this particular financial year, what is the margin guidance at a consolidated level? Look, I believe that the margin, as far as this company, the current short-term is concerned, I think it should remain the same as it is there in the first two quarters. It should not change much. On the medium term, again, as the product revenue increases, as we have been trying to increase the product revenue, margin should become a little bit better, a little bit better only. Thank you. And another point, the backward integration, which we are doing, expanding our capacity in fiber, that should also help us in increasing our margin. Right now, we buy a lot of fiber from outside. Once we do backward integration project, which is under implementation, it's complete. That should also help us in enhancing our margin. And I believe we have submitted bids in BharatNet. So when those bids will be out, sir? Any timeline or any indication? Sir, those bids, sir, are being evaluated. And as I understand, as much as we understand from what is happening, they are in the advanced stage of technical evaluation. Technical evaluation, again, this is government. I can only express what I understand or what my best of my opinion is. Technical evaluation should get completed mid-November, sometime mid-November, looks like. It may get delayed by a few days here or there because the government processes, we all understand. And actual bids should be opened thereafter. And if all going well, contracts should be awarded. Sometimes financial evaluation will also take time, sometime beginning of next quarter. Okay, okay. Thank you, sir. Thank you. Thank you, sir. The next question is from the line of Aksh Rampuria from Dron Capital. Please go ahead, sir. Hi. So I just wanted to ask, what are the size of revision for fiber optic cable? And what is the current capacity utilization? What did you say? First of all, what was the size of? What is the size of revision? [audio distortion] Okay. We are asking what are the size of revision of fiber optic cable business. That's what the question is, Rampuria? Yes, yes. The size is that more inquiries are coming, more RFPs are coming from international customers. For local customers also, more inquiries have come, and we have seen them giving higher predictions for their requirement than what we were getting from them in the last quarter or previous quarter before that, so all that indicates once the customers are indicating that their requirement would be so much and so many times more than the last quarter, some of our customers who did not purchase even a single kilometer of fiber cable in the last quarter are now coming up with very reasonably good demands. So all that put together, when customers come up with the predictions that this is going to be our demand in the next two quarters, or when we see that more RFPs or tenders coming from the international customers, that shows that the requirements are there, which was not happening for the last two quarters. Such kind of demand opportunities or tenders or RFPs were not predictions were not coming, which is a very heartening sign, which means now the requirement has come up. And when we go to the international market, talk to the various customers, everybody is saying that, yes, we are now going to start purchasing, going to start purchasing from the next quarter or quarter next to th at. So those things do indicate that the demand is increasing. And sir, what is the current capacity utilization? What is the current price of fiber optic cable right now? Fiber optic cable business, the current capacity situation is about 45%. Which we expect to improve from the next quarter, as I said. What would be the estimate? I cannot say that how much improvement would be there exactly. I think this 45% should easily go up to 80% or so. Okay. Or maybe more also possibly, but I can't commit to that. As I see, it has to be something like that, 80% at least, maybe more. What is the price of fiber optic cable? How do we see going forward? Fiber optic cable, I can tell you, talk to you about the price. In terms of fiber kilometer, kind of a price per fiber kilometer, just let me certain. Yeah. It is at the moment, the realization is about INR 900 per fiber kilometer, to be precise INR 890 per fiber kilometer. Okay. That would be all. [audio distortion] Hello? Mr. Rampuria, are you done with the question? Yes, yes. Okay. Thank you, sir. The next question is from the line of Jinesh Shah from RSPN Ventures. Please go ahead, sir. Yeah. Hello. Is my voice audible? Yeah, you're audible. You're audible. Yeah. Okay. So thanks for the opportunity. So my first question would be regarding the CapEx. Actually, the company was trying to plan to do CapEx of approximately INR 900 crores in the second half of the year. Yes, yes. [audio distortion] Very loud. And it is echoing. Speak a little slowly. Little low voice. A little slow. Yeah, yeah. Sure. My first question was that the company was planning to do CapEx of approximately INR 900 crores in the next couple of years, right, in order to build new capacity in Poland or an extension of OFC. This fund is majorly via debt, right? I just wanted to understand. Sir, your voice is completely unclear. We just can't understand A, B, C, D of this. Operator, can you see how the voice can be made better? It's completely very much echoing. Okay, sir. I'm checking. Is it okay now? It is now okay. Now it is okay. It's okay now. Okay. My first question was that the company was planning to do CapEx of INR 900 crores next two years, I guess. And majorly, it was funded via debt, right? Is the company planning to do much more borrowings in the next half of the financial year? Because I can see that in September balance sheet as well, the borrowings have been increased significantly. And also, if you can share a big idea about the repayment schedule so that in order to reduce working capital pressure, working capital cycle in the future. So CapEx, which we have planned, everything is structured by way of equity, debt, and internal accrual. So our debt-equity ratio is likely to remain in this range of 0.25-0.30. There is not going to be much borrowing. It's quite comfortable. Okay. So whatever you might have raised debt in this first half of the financial year, so that is likely to remain stagnant, right? Yeah, yeah. So there are repayment also. If there are subsequent borrowings, there are repayment also happening. So it is likely to remain in the same range. The entire CapEx is being funded by way of equity, which we have raised in the past, and then some internal accruals, and also by way of debt. Okay. Fine. Thanks a lot. Okay, my second question would be regarding the BharatNet Phase 3 project, which, the announced budget, is approximately INR 65,000 crores. I just wanted the breakup of allocation of the funds, like what amount of funds would be in OFC equipment, EPC services, so that it sums up to almost INR 60,000 crores, INR 65,000 crores. The INR 65,000 crores is the total cost of the CapEx. Now, how much would be cable and how much would be that? I would suspect cable and cable-related activities. When I say 15 lakh fiber kilometers, would be roughly you can say about INR 5,000 crores would be roughly about cable and INR 5,000 crores plus would be cable and cable-related activities. And then equipment would be there. And then services like road digging and those kind of services would be another INR 5,000 crores -INR 7,000 crores. Then the duct will be there on the similar numbers. Equipment would be there around INR 8,000 crores -INR 10,000 crores. This is the way it would be divided. I don't have the exact numbers, but more or less, I'm saying. Okay. Fine. But still, it doesn't add up to like INR 60,000 crores. That is like a huge number if I go with that. Huh? But I'm saying that it still doesn't add up to INR 65,000 crores. It doesn't add up to INR 65,000 crores. It doesn't add up. So there are a number of other services. I've just given you more or less. This is going to be the requirement. Roughly about, but I have to make exact calculations. 15 lakh fiber kilometers multiplied by INR 1,000, how much it is. So out of that, if you can say, what would be the time of HFCL in this overall project? HFCL's expected market share out of INR 65,000 crores? Yeah. You can say that, or opportunity, you can say. No, opportunity means our opportunity comes from two directions. One, the places where we have participated directly in the five different sectors. Second, what we expect as orders for equipment and cable from other winners. Not only what we get from directly, but what other winners who are going to win. They are also going to buy our fiber optic cable, routers, and UBR, and those kind of equipment. So as I have said, we are more or less expecting somewhere between INR 5,000 crores to INR 8,000 crores. That is my best estimate at this point of time. I cannot commit to that because we don't know how the tenders open up or who wins, but reasonably, we are expecting INR 5,000 crores -INR 8,000 crores of opportunity for HFCL. Okay. Fine. Thanks a lot, and one more question from my side. If you can just state that till now, what all the projects that we have already bid for, and also if you can mention the winning ratio of HFCL at this point of time? Look, we have been bidding various projects, and we are winning quite a lot. For example, BSNL, whatever projects we have bid. I think more than 50%-60% we have won. 50%-60% we have won BNG, we have won OTN, we have won UBR. So quite a good success rate is there. Can you quantify the overall amount if you have that number? Overall amount for BSNL has been about INR 800 crores for OTN. UBR was roughly about some INR 200 crores. And this one has been about INR 40 crores. So BSNL has been roughly about INR 1,000 crores plus, something like INR 1,000 crores. And private operators, there is no bid at such. These are all negotiations which take place. So wherever negotiations are there, which are our established customers, we are taking 100% of them, more or less. Internationally, yes. It's a winning ratio could be something like 20%-30%, 20%-25%. Okay. Fair enough. And also, just to mention with the opening commentary that you are participating in the BEAD program that is in the U.S., right? And I have heard that the states have now started with a sub-grant process in order to submit the final proposal by this year itself. So can you just give an estimate about what is the now status of the HFCL? What is the status of HFCL in it? The purchase has not yet started. There are two kinds of opportunities here. One is BEAD, one is non-BEAD. BEAD is going to be roughly about 30% of the opportunity. That 70% is not BEAD. Not everything is going to be under BEAD, something and all that. So the market opportunities comes up overall spread of FTTH in the USA. So non-BEAD also is a very big opportunity. BEAD's program purchase has not yet started, as you rightly said. But apart from BEAD, operators are doing their own work also for many, many areas in fiber optic cable. So non-BEAD opportunities, we have already started receiving inquiries. We are already participating in that. So it's not only BEAD. Non-BEAD opportunities are also quite large. Okay. So I can conclude that the BEAD program, we have just submitted the proposal, but it's not yet out. We have not submitted any proposal because there are no inquiries as yet. Okay. No worries. Okay. Thanks a lot. I never said that we have submitted any proposal. We just said that that kind of demand would come up. Okay. No worries. Thanks a lot for your time. Thank you, sir. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your question to two participants. The next question is from the line of Hardik Vyas from The Economic Times. Please go ahead, sir. Sir, I had a couple of questions. Out of the total product revenue that we have recorded this quarter, I wanted to split between Telco product and. Sorry to interrupt, sir. Mr. Vyas, please use handheld to ask questions. Sir, can you split the contribution of revenues from the telecom products and OFCs for the quarter? It's roughly about 50/ 50. Roughly about 50/ 50. Okay. And as guidance is roughly INR 2,000 crores for telecom products for the current financial year. Are we on track to do that? Because. Yeah. I think we should be able to do that. There shouldn't be any problem. Okay. So the guidance for the OFC business has been lowered, but the telco business remains the same. Telco business remains almost there. But OFC, the world market has gone down significantly. So we are part of the world market. Can't change that. So it's not really guidance. That was our expectation. But the market demand has not picked up as we thought it would pick up. So as a result of that, OFC revenue has gone down considerably. But as I said, I expect this market to pick up from next quarter. That is our best expectation, India and internationally both. In India, once the BharatNet entry is awarded by the end of this financial year, maybe quarter next to that, it should pick up more significantly. But otherwise, also, market is expected to pick up from next quarter. Okay. And so the order inflow in terms of is the execution of Madhya Pradesh and Uttar Pradesh Jal Nigam a part of the turnkey revenue this quarter, or are we expecting? It is a part of it. It's an overall consolidated stuff. How much time do we see till we finish those two orders? I think this should be one. Uttar Pradesh should be finished by end of March. And the other one should go into the middle of next year. Okay. And sir, do we see any new orders from the service business? Last one. No. Because BharatNet is going to be a large order if it comes, sir. Okay. That you said in the last quarter first. Yes. Sir, you are in Economic Times. You know the government orders. You can only give your best expectations. So our best expectation should come up in the next quarter. But government is government. The time may take more or less. Okay. That's all, sir. Thank you so much. Thank you. Thank you, Mr. Vyas. Thank you, sir. The next question is from the line of Sukkant Garg from EQUIBLE RESEARCH PVT LTD. Please go ahead, sir. Sir, my question is merely regarding the top customers. So what is the revenue concentration between the top three or top four customers? Could you please provide that? Top three or four customers who account for, I think, sir, about more than 60% of revenue. And that revenue is from both the telecom and optical fiber cable, or it's majorly from the telecom segment? Telecom and optical fiber cable, yes. Both. Okay. That's all. My most of the questions have been answered. Thank you. And congrats for the numbers. Thank you, sir. The next question is from the line of Nikhil Purohit, Fident Asset Management. Please go ahead, sir. Hi. Am I audible? Yes, yes. Yeah. So I wanted to ask, does the business face any seasonality as such, such as H2 being stronger than H1 or anything like that? Sir, repeat your question. Your voice is again, I think that. Yeah. One second. Is it clearer now? Yes. Very much clearer. Yeah. So does the business face any seasonality as such, H2 being stronger than H1? Seasonality. Yeah. Seasonality, yes. Okay. Seasonality is always there in Q2. If you see the history, more or less, every time you find Q2 has a seasonality because of rains. Because of rains, what happens? As it is, fiber optic cable demand has been lower, but on account of rains, it becomes even lower because the installation and commissioning work of fiber optic cable does not happen at that speed because of rains, waterlogging, and all that. So there is a seasonality element in the EPC business, O&M business, and which also impacts the fiber optic cable business also. So as it is, fiber optic cable market was down. Coupled with the seasonality, this happened even to a greater extent, so Q2, generally, you expect seasonality because of rains. That's more or less my experience last 20 years. I've been watching that. Maybe barring in between a couple of years, some variations may have been there. But more or less, the seasonality is there in quarter two. And if you look at international markets, some of the countries where you have very, very heavy snowfall, you would find the months of December, January, February, there would be less implementation of the network resources because of the very, very high snowfall. Understood. I have two more questions, so can you give the bifurcation for revenue within the products that? Yes, sir. May we request that you return to the question queue for follow-up questions as there are several participants waiting for their turn? Okay. Sure. The next question is from the line of Kriti Tripathi from NVS Brokerage. Please go ahead, ma'am. Yes. Myself, Kriti. So my question was that for the Q2, the profit is around INR 73 crores, and the EPS is around INR 0.52 on a face value of INR 1. Although the top line of the company is growing, the profitability is very reasonable. And even if I make arithmetic estimation based on that, the full year EPS is coming around to be INR 2 or INR 2.5. So given the current price and the PE is going around 55-60 times, and even the correction is there, this is the condition. So where is the investor seeing the appreciation in the value? This is what I wanted to ask. Well, yes. Whether appreciation of the stock market would be there or not, share price, I can't comment on that. These are not for the management to comment. Yeah, but at least EPS figure, how the company is planning to improve on the profitability part and how the management is seeing that this investor return can be rewarded to investors. So this EPS will certainly improve with the increasing revenue as we have planned and have a vision that our revenue should be INR 10,000 crore in three years' time, so definitely, profitability will improve, and EPS will also improve, so whatever endeavors we are taking now for capability build-up or the capacity build-up, it will convert into revenue and this performance from coming year from next financial year onwards. We can only comment about the performance, about the investor's return, market. These are not the issues which we can comment. Okay. Thank you. Thank you, ma'am. The next question is from the line of Aksh Rampuria from Dron Capital. Hi. So then can we expect the revenue coming in from electronic fuzes and the defense business? Yeah. These are under trial at the moment. And I sincerely believe that from the next year onwards, this revenue will start coming up. Okay. And what?-- A lot of inquiries are there for these electronic fuzes. So just this trial should get completed, and then we believe that I expect a reasonably good amount of revenue from that. How do you view the market currently? Market currently, I don't have an estimation of the world market with the geopolitical situation being what it is. But the number of inquiries we are receiving, market should be in lakhs of fuzes. It should be in lakhs of fuzes. We have inquiries worth a few lakhs. A few lakhs of fuzes, not rupees. Okay. So that was all from my side. Thank you, sir. The next question is from the line of Shubham Sethi from Logical Investing. Please go ahead, sir. Hello, sir. Sir, my question is regarding the INR 2,000 crore of telecom and network product basically guidance that was given. So how much is the order book for the networking products, and are we on track to achieve the INR 2,000 crores? I tell you one thing. Right now, the order book would be something like, I think, INR 800 crores or INR 900 crores. Current order book should be there. But telecom products like any equipment or like UBR or Wi-Fi or fiber optic cable, you keep on receiving orders. Not that you always have orders in your hand of a huge quantum. But yes, right now, the orders should be there something in the range of INR 800 crores -INR 900 crores. Okay. Sir, are we on track to achieve the INR 2,000 crores? Out of that, part of the revenue has already happened. INR 800 crores, INR 900 crores, the pending order in our hand. Okay. So sir, overall, I think, how is the traction for our products in the market? Traction is good. Traction is good. For example, 5G products like fixed wireless access, the UBR, unlicensed band radio, they have good traction. Good traction. Traction is no problem. Okay. Thank you, sir. That was the only question I had. Thank you, sir. The next question is from the line of Saket Kapoor from Kapoor & Co. Please go ahead, sir. Mr. Kapoor, please go ahead. Your line is in talk mode. As there is no response, we'll move on to the next question. The next question is from the line of Keval Navin Doshi from OMG. Please go ahead, sir. Hello. Yes. Am I audible? Can you hear me? Can you hear me, sir? Yeah. Okay. My question was, since our focus is now getting more on products, can you just give some idea about in the next three years, which would be the top three or four products on which you would be focusing on, whether it is in telecom or whether it is defense, all the factors put together? Look, both. Telecom as well as defense. In telecom, if you look, 5G has got good demand attraction at this point of time. Out of the INR 900 crore order of the telecom equipment I talked about, there's only one equipment for which we have INR 600 crore order, which is 5G equipment. And we expect to receive more such orders. And again, as we move forward, technology keeps on improving. So we are continuously improving our technologies. And unlicensed band radio, I talked about, we have supplied 5 lakhs of radios in the country. It started with 300 Mbps per second capacity. Today, we are doing 2 Gbps capacity. 6x, 7x enhancement of the capacity. Then earlier, we were doing point-to-point. Now, we are working on point-to-multipoint radios. So focus is always there on telecom products, including fiber optic cable also is a part of telecom, only improving the size of cable, number of fibers, thickness of cable, thickness of fiber. All those kinds of things are improving. So, definitely, telecom has been our core business, and focus on telecom is going to be there. But simultaneously, we are focusing a lot on the defense products also by building our own IPR and also working on participation or collaboration with foreign companies also in the defense electronics field. Both areas we are working. And that is also our focus area to build up our revenue from defense electronics. Okay. So roughly, sir, what kind of if you have to break up in your mind, would you say that out of the turnover from products, 50% could be defense, 50% could be telecom products? I would say it should be two to one. Two from telecom, one from defense. Something like that in some time frame. But these ratios can keep on changing, sir, depending on market situation and all that. Right. And sir, how competitive is our pricing compared to? Pricing is competitive. Unless you have competitive prices, you are not going to get orders. So do we have some advantage because of Make in India for the telecom products? Yes. Definitely. Because of Make in India, you have advantage because once you are manufacturing in India, your cost is low. Your ability to design the products as per the requirement of the customer is there. Your delivery is quick. So those advantages are definitely there. But number of other companies are also manufacturing in India. We are not the only one. And another benefit is the PLI, Production Linked Incentive, that has been announced by the Government of India. We are a recipient of that also. So that is another advantage. And our products would qualify? Yeah. Sure. It has already been approved. Thank you for the question, Keval. Okay. Thank you so much. Thank you for this opportunity. Thank you. Thank you, sir. The next question is from the line of Manoj Duria from Duria Asset Management. Please go ahead, sir. Manoj, your line is in talk mode. Please go ahead. The next question is from the line of Tushar Pandey from individual investor. Please go ahead, sir. Hi, sir. Can you hear me? Yeah. Sure. Hi, sir. Last time around in the con call, it was not a formal guidance, but you mentioned that you kind of expect 25%-30% revenue growth in this year. So can we still see or if you would like to tweak that guidance? Look, it was not a guidance. It's an estimation what we had at that point of time. And that was largely predicated upon our revenue in fiber optic cable becoming about INR 2,000 crores. But we see fiber optic cable market having been not so good. Rather, it has been very sluggish in the current financial year. That revenue has probably will come down. It will not be the INR 2,000 crores. Rest of all, the estimations are more or less on track. Except fiber optic cable, I think we are on track to achieve our numbers. So why I ask this is because you had already mentioned that OFCs were facing a lot of headwinds because of the oversupply. So wouldn't this be already accounted for in the expectations that you mentioned that 25%-30% is achievable? OFC of the current financial year. That was not the situation there. At that time, we had so much orders that we were overflowing with orders, and the capacity utilization was almost 100%. So we had not taken this into account, which happened. All of a sudden, the demand went down, and there were hardly any inquiries. If we had known that, then we would have certainly taken that into account. So at that time, estimation was based upon what was the best situation, what we could force this. Okay. And the second question is, you mentioned that you had already developed. T his is my second question. Please let me ask this. Okay. Go ahead. No problem. Sir, last time around, you mentioned that you had already developed 1764 fibers in one optical fiber cable. And you were planning to develop 3400 fibers in one optical fiber cable. So sir, how is that planning out? Sir, 1764 is already there. We are now starting marketing that. The second one development is going on, which is quite complex. 3,000 fibers in one cable and keeping the diameter low. So that's quite complex. But we are doing it. I think it will take a couple of two to three months more to finalize that. There are any competitors in 3,400 fibers? Yeah. There would be competitors. Absolutely. There would be at least 10 manufacturers in the world who would be doing that. Okay. So Indian competitors I was talking about. Yeah. I think there would be only Sterlite. I don't believe there is anybody more than that. Maybe Birla VTL could be there. Maybe. I'm not aware. Sterlite is. Okay. Thank you so much, sir. And wishing you all the best. Thank you. Thank you, sir. The next question is from the line of Saket Kapoor from Kapoor & Co. Please go ahead, sir. Namaskar, Nahata ji. And thank you for the opportunity. Sir, when we look at our first-half performance, there is an increase in the interest cost outgo and also the employee cost that is not commensurate with the increase in the revenue. So if you could give us some color how are things shaping up with respect to these two line items? And secondly, about the BharatNet part of the story, sir, I think it is taking longer than what anticipated. Or according to you, things are in line, and we can expect the awarding of orders by this quarter, and then a clear picture would emerge. Your thought on that? No, no. BharatNet has taken longer than expectation, definitely. Because tender was to come, I think, two to three months before when it came. And if it had come at that point of time, it could have been possibly decided by now. Possibly. But tender came late. So that process of evaluation is going on, which is going on at a reasonably good speed, looking at the government processes and all that. It's going on at a reasonably good speed. And I believe that, again, my estimation, you never know. Government may delay. Government may do faster. You don't know really. But in my opinion, they should be able to award the contracts in the first quarter of the next calendar year, last quarter of this financial year. Industry should be able to see the orders. But government being government, one has to wait. One cannot be definitive of the time frame. It is also the urgency of the issue said, whether how important it is to get things done and get the order awarded. That is also estimation. Look, I can tell you urgency on the one fact. The Prime Minister himself has announced the program from Red Fort on Independence Day. That itself tells you how important the program is. If the Prime Minister announces from the Red Fort on Independence Day that we'll connect all the villages by fiber optic cable, it's an important project. If the Prime Minister announces it twice. So I believe it is part of what government says in the Pragati review, Pragati programs, which are reviewed by the Prime Minister's office very periodically. It is part of that also, I believe. So it is important. And anyway, connecting villages by fiber optic cable is not an issue only in India. It's worldwide. So India has taken a good lead in that. And it's quite an important program. And more important fact, another important fact, I tell you. Money is available. If money is not available, then it becomes a low priority. If money comes from USOF, USOF is already having money for implementation of this program. And every year, more money comes in by virtue of revenue share by the operators, which is compulsorily given to USOF. So money is not a constraint. And the Prime Minister himself has announced it. So importance is there, definitely, from these two facts you can understand. Right. And on the employee cost and the finance cost, they are trending higher, sir. And they are not commensurate to the revenue growth. [crosstalk] And therefore again also. Saket ji, there is hardly any variation in employee cost. It was INR 88.70 crore in last quarter, which is INR 89.45 crore in the current quarter. And similarly, the finance cost is also it was INR 42.31 crore in the last quarter, which is INR 44.88 crore in this quarter. So there can be some variation because of some LCs getting opened or some bank guarantees. So this is a [Foreign language] small variation that is comparable to a big variation. Sir, I'm looking at the first half, sir. When we look at the first half, first half to first half, INR 87 crore is the finance cost. That was INR 71 crore last year. And similarly, for the employee cost, 173-178. So I was referring to the entire first half in terms of the finance cost rising up. [Foreign language] So this is what we have last year compared to the first half. So that profile was completely different, which has changed from the second half of the last financial year. If you compare Q3, Q4, Q1 of the preceding quarters, it is in alignment. And secondly, see, we are building up the organization for the next journey. So a lot of new hirings are there in various divisions, maybe defense or telecom, optic fiber cable, some international market. So there may be some variations, which will convert into revenue and result in coming quarter. [Foreign language] [Foreign language] Okay. [Foreign language] [Foreign language] O&M is not much. But from the year 2027, it will go up to INR 300 crore -INR 400 crore. Okay, sir. So we have to do a lot of catch-up, sir, with our earnings profile now for the second half. Because as one of the participants did mention, there's a lot of expectation that has been built up with investors. And somehow or the other, because of conditions not in our hands, that expectation is not matching with the performance. So we hope that we can walk the talk going ahead with improved set of earnings going ahead. Thank you. Like I said, except fiber optic cable, nowhere else we will have problems. Fiber optic cable market worldwide, there has been a recession. We cannot be away from that. We have to go with the market. Now, as far as the fiber optic cable market is concerned, I have repeatedly said that I am expecting it to improve from the next quarter. I think we will definitely try our best. Whatever our investors expect from us, we are able to fulfill that. Maybe quarter or two here or there can happen because of market conditions. But overall, I am pretty sure the kind of effort the company is doing will fulfill the expectations of our investors. Thank you, sir. The last question is from the line of Priyanshu from Frontline Capital Services. Please go ahead, sir. Yeah. I am the man of the revenue and the proposal for the FY 2025. Priyanshu, we are not able to hear you properly. Yeah. I will speak again. I am the man of the revenue and the profit guidance for the FY 2025. Mr. Priyanshu, can you use your handsets? Your voice is breaking. Yeah. I'm saying man of the profit and the revenue guidance for FY 2025. I can't give any guidance at this point, Priyanshu. There is no guidance possible. I am only saying that our expectation is that we should do better. Okay. Sure. Thank you. So thank you very much, ladies and gentlemen. Thank you for your participation in this call of today. And I again reiterate that the company is working very hard to see that the growth in revenue and the profitability both by doing more product-led revenue, by doing more and more in the export market, by going to different areas of defense equipment. And I hope that we will have a very because of the market conditions are turning out to be better now from what we have seen in the last two quarters, we expect that telecom sector and defense sector both should do well in the country and internationally. And that should be impacting our company also positively. Thank you very much. Thanks a lot. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.