Ladies and gentlemen, good day and welcome to the JNK India Q1 FY26 earnings conference call hosted by IIFL Capital Services Limited. 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 star then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Akshit Gangwal from IIFL Capital Services Limited. Thank you. Now over to you, sir. Thank you, Shruti. Good morning, everyone. On behalf of IIFL Capital, I welcome everyone to JNK India's 1Q FY2026 earnings call. We have with us today Mr. Arvind Kamath, Chairperson and Whole Time Director, Mr. Pravin Sathe, Chief Financial Officer, and Ms. Annie Varghese, Senior Manager, Investor Relations. Without further delay, I will now hand over the call to the management for their opening remarks, which will be followed by Q&A. Over to you, sir. Good morning, everyone. I am Arvind Kamath, Chairperson and Whole Time Director of JNK India. Thank you for joining us today for our Q1 FY 2026 earnings call. We appreciate your continued interest and engagement as we begin the new financial year. The first quarter of FY 2026 was centered around project execution. Our teams remained focused on delivering ongoing assignments across domestic and international markets. While the quarter did not see any significant order inflows, operational activities remained steady, with delivery efforts aligned to client milestones. Total revenue for the quarter stood at INR 1,030 million, reflecting a year-on-year growth of 13.5%. As of June 30, 2025, the company's order book stood at INR 9,828 million, comprising 79.4% from heating systems, 12.8% from process plants, and 7.8% from flares, incinerators, and other renewables. Domestic orders accounts for 90.9% of the total order book, ensuring strong revenue visibility going forward. India's refining and petrochemical industry continues to report stable growth, supported by strong domestic demand and expanding infrastructure. At the same time, the country's transition towards renewable energy and green hydrogen is accelerating, creating new opportunities for engineering and technology-led solutions in the energy and industrial sectors as well. Aligned with these developments, the company has entered into a joint venture agreement post the quarter with Mr. Sunil Dhole and Mr. Tushar Wagh, founders of Chemdist Group, to develop green hydrogen and other sustainable fuel technologies and also critical engineered equipment in chemical and pharma industry. JNK India will hold a 51% equity stake in the newly formed entity. This initiative enhances our entry into the emerging green hydrogen segment and also chemical segment, enabling JNK India to expand its offering beyond conventional combustion equipment and into clean energy process infrastructure. This JV will also provide access to international expertise, support technology co-development, and create potential for participating in upcoming green hydrogen projects in India and overseas. Looking ahead, we remain focused on delivering our existing order book with discipline and technical precision. Our integrated capabilities across fire heaters, cracking furnaces, incinerators, flares, and process plants enable us to serve the evolving needs of refining petrochemical, fertilizer, and clean energy sectors. Backed by strong engineering depth and modular manufacturing at Mundra, JNK India is well-placed to support complex energy infrastructure needs both in India and select global markets. I would also like to highlight that in the existing execution of Reliance project at Nagothane, Bechtel has given us a special mention of safety for JNK India team. With this, I would like now to invite our CFO, Mr. Pravin Sathe, to take you through the financial performance for the quarter. Thank you. Good morning, everyone, and thank you, Mr. Kamath. I'm Pravin Sathe, CFO of JNK India. I will now present the financial performance for the Q1 FY 2026. For the quarter ended June 30th, 2025, the company recorded a total revenue of INR 1,030 million, reflecting a year-on-year growth of 13.5%. Operating profit for the quarter was INR 242 million, with an operating margin of 23.5%. The EBITDA stood at INR 72 million, translating to a margin of 7%, compared to 13.4% in Q1 of FY 2025, and 13.8% in Q4 of FY 2025. Profit before tax stood at INR 20 million, with a margin of around 2%, while profit after tax was INR 11 million, representing a margin of 1.1%. The margin compression during the quarter was primarily due to the legacy projects under execution, which impacted the overall profitability. As mentioned in our earlier conversations, we have now transitioned our revenue recognition model to suit the evolving company from a fire heater company to the present-day structure. Earlier, we followed the practice of output method. We adopted the input method in H2 of FY 2025. The projects awarded in FY 2025 were based on the new revenue recognition model. In quarter one FY 2026, the substantial revenue came in from earlier projects and the balance from the new ones. The cost incurred for the earlier projects formed majority of the quarter's operating expenses, whereas the remaining cost attributed to the new projects. This highlights that there are no concerns in the operations and profitability as such, but it's a temporary pain due to some former projects which continue to incur higher costs. Certain projects under execution continue to face delays, which have added to the cost. The impact of higher costs related to the earlier projects is likely to continue in quarter two FY 2026 as well. On the employee cost front, the employee cost net of ESOP expenses in quarter one FY 2025 as compared to the employee cost in quarter one FY 2026, there is an increase of 15.5% year-on-year. We continue to focus on the disciplined execution, cost control, and alignment of internal systems to support the timely delivery. The company remains committed to improving operating margins through the better project planning, engineering, productivity, and the scale benefits across our ongoing order pipeline. Thank you for your attention, and we now welcome your questions. 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 on the line of Kamlesh from Lotus Asset Managers. Please proceed. Yeah, thanks for the opportunity. Sir, I had multiple questions. Firstly, on the revenue guidance and on the EBITDA margin guidance. In last quarter, we had given a guidance of 40%-50% revenue growth and margins of roughly around 12%-13%. Are we sticking with that or has there been any change over there? The guidance for the yearly growth of revenue and the EBITDA margin remains the same. What you have mentioned, we still stick to that. Okay. Sir, any update on the orders, like some order from this one Oman Refinery and Bharat Oman Refinery, Astrel Bharat Oman Refinery, which is now BPCL owned. Any order update on that particular side or from Reliance or any other project? Yeah, Kamlesh. Okay. Regarding the order finalization, in the quarter one, there was one large finalization, which unfortunately didn't come in our way. In quarter two, there are two finalizations are expected any time, including the one which you mentioned, that is BPCL Bina, and there's one more as well. We are just waiting for the order finalization any time. These two orders are to be expected to be finalized any time now. Can you broadly guide us how much would be the size of that, ballpark, not an exact figure? Both these finalization will be actually bid by the JNK Global from Korea based on whatever the criteria in terms of the bid qualification criteria was involved. These two projects roughly could be anywhere between INR 2,000-3,000 crores. Great. Sir, lastly, when we came out with the IPO, your margins and revenue were, let's say, in the boom stage. Now if we see this legacy particular thing, for a size of INR 1,000 crore order book. How can we have such a legacy order book? Because it's surprising that a margin from a level of 15%, 20% dips down to as low as 10%. For a shareholder, how can we guard or protect the shareholders from such a high volatility and when we have such a high precision in the technology and we have such a big upper hand over the technology? How can these things happen, lots of legacy order book, where our margins, let's say, go from double digit to single digit, as low as 4%, 5%? Yeah, Kamlesh. As we said earlier that this legacy order book is likely to get over by the Q2 of FY 2026. We have explained earlier also that due to the output method of revenue recognition we were following, the margins quarter-on-quarter were not stable because it is based on the milestones, and certain milestones have high profit margins and certain have lower profit margins attributable to the project life cycle. In order to iron out these variations, we already adopted the input or cost-based method for the projects that were awarded to us in FY 2025. Going forward, you will see the impact on Q3 and Q4 revenues, that majority of the revenue would come from these new projects, and there will not be any volatility as such on the profit margin side. Going forward, all the orders which we are winning, so their 12, 13% margins, we are factoring in there? Yes. Great, sir. Great. Thanks a lot, sir. Thank you. The next question is on the line of Jainam Doshi from Kriis PMS. Please proceed. Good morning, sir. Just wanted to understand, what would be the execution timeline of the current order book which we have, and what are the sustainable EBITDA margins we are targeting post the completion of the legacy orders which we have? The current order book could get executed up to quarter one of next financial year, that is Q1 of 2027. The EBITDA margin guidance that we had given of somewhere between 13%-15%, that we can consider once these legacy projects are over. Okay. Sir, in the previous con call, you had mentioned that there will be some kind of a spillover effect from Q4 into the Q1 of this year. If you can quantify the amount of that spillover in the current quarter which we have executed. You mean the spillover from the old projects? Yeah, spillover from the Q4 of the earlier years. Yeah. The spillover from the earlier Q4 is the major portion in this Q1, and that is the reason the margin has also been impacted. Okay. If you could quantify? We can get back to you one-on-one for this. Sure, sir. Thanks a lot. Thanks. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is on the line of Paresh Raja from IMAP India. Please proceed. Good morning, Mr. Kamath. Can you hear me? Good morning, Paresh. Yeah. We can hear you. You mentioned about forming a JV with two individuals for hydrogen and other technologies. Could you throw some more light in terms of what is the expected date of commercial production, what is the additional CapEx which is required, and what is the likely revenue in the first year, and what would be the peak revenue, and what is the profitability in this JV? Yes, Paresh. We have entered into the JV agreement about two weeks back. We have signed the JV agreement with Mr. Sunil Dhole and Mr. Tushar Wagh. They were the founders of Chematur Group. Chematur Group is already into engineering and manufacturing of critical equipments like reactors and distillation columns, scrubbers, et cetera, for the chemical and pharma industry. They're also developing green hydrogen technologies and also other sustainable fuel technologies. We as JNK see a large opportunity if we can support them and grow in a bigger way, and that's the basic essence of this JV. In terms of the financial, what you asked, we would be supporting them in terms of the working capital mainly. The extent of- Working capital support could be about INR 50 crores or so in the 1st year. Initial equity is about INR 51 lakhs. Also the initial investment is about INR 10 crores in the company. By way of preference capital? Yeah, this is by way of preference capital. In terms of the revenues, they already have certain order book which will be started in JV from this year itself. In this financial year itself, we would see a certain amount of revenue, which could be about, say, 10%, around 8%-10% of JNK India's revenue. Going forward, in two to three years' time, we look forward to a revenue growth in the new company, the new JV business, which is about 10%-15% of JNK India's revenue. Maybe up to five years, we can look at something like 15%-25% of JNK India's revenue in the new JV business, which is focused mainly on the specialized chemical equipment and the special technologies of green hydrogen and other technologies. They also export to countries like Saudi and other Middle East countries as well. Okay. What is the likely profitability from the projects that we'll do? The likely profitability of EBITDA could be anywhere between 10%-12%. Okay. My second question is pertaining to the orders which get routed through JNK Korea. You mentioned that there's an order finalization which is likely to happen to the tune of maybe INR 2,000 crore, INR 3,000 crore. Would this be completely to JNK India or is it into multiple parts and we may get part of the order? There is. I mean, yeah, just considering the size of the projects, the large size of the projects which is there. It could be one job which is there, which is a smaller one that will be on a complete back-to-back basis, but the other larger job which is under finalization, that would be on a part basis depending on the situation and depending on the process. Though we will be actively and majorly involved in the execution, JNK India would be doing a lot of things as well. Okay. Can we expect the order finalization in the month of August? That would be a bit difficult to say, but we are quite confident that at least out of the two jobs, one job will get finalized in this quarter at least. Okay. Thank you. That's it from my side. Thank you. Thanks, Paresh Thank you. Participants who wish to ask a question may please press star and one at this time. The next question is from the line of Jainam Doshi from CRISIL. Please proceed. Yes, sir. Thank you for the follow-up. One question which I had is, as we mentioned, we might get some part of the bigger order and one of the smaller orders. Do we have the bandwidth in terms of the execution and also the existing CapEx is sufficient, or we would require any further CapEx for it? If you could elude it. About the bandwidth, Mr. Kamath will enlighten, but so far as CapEx is concerned, I would like to inform you that there would not be any additional CapEx required. Just on the bandwidth. Okay. Depending on obviously the size of the project, there could be only bandwidth. What we would require more would be the people and certain softwares, and we are gearing up to that, and I think we will be able to handle it as it comes. Should not be an issue for us. Sure. Thank you. That is from my end. Yeah. Thank you. Participants who wish to ask a question may please press Star and One at this time. The next question is from the line of Kamlesh from Lotus Asset Managers. Please proceed. Mr. Kamlesh, your line has been unmuted. Please proceed with your question. Sir, with regard to the order book, like we had highlighted that it would be INR 2,000-3,000 crore. Would it be our share, JNK India's share, or you are talking about the group's share? Yes, Kamlesh, the INR 2,000 crore-INR 3,000 crore order finalization is on JNK Global. Our share, we will have to derive exactly depending on which project and what will be the exact our activities will be for that particular project. Sir, usually on the past experience basis, how much share we used to get from the JNK Global? See, on a smaller project, it would be, and if the project is not in Korea, then it is 100%. If the project is large and if it also involves lot of BGs or the LCs and the foreign components, then it can range anywhere about 30%-70%. Since it's an Indian project only, domestic project, can we say that it would be around 90%-100%? No. That way it would be difficult to say, Kamlesh, because it also involves a lot of foreign components and certain things. Because of the size of the opportunities which are there, it would not be to that extent. Sir, beyond this, how are we seeing the pipeline of orders going forward, beyond these orders? Beyond these two finalizations in this quarter, there are two more finalizations lined up in the next quarter. Generally, pipeline, as we said in the previous call as well, is quite healthy. There are projects lined up in India and in the exports as well. Where do we see this pipeline of INR 950 odd crore order book to go up to, say by the year-end? It's difficult to guide the exact numbers in terms of the order book. There is a order finalization expected in this financial year, which is about say INR 3,000 crores or so. Out of that, now how much share we will get is what we will have to see. What we have seen in the last couple of years is we've been able to have a healthy order inflow and healthy order backlog as we're going. With the visibility of around one and a half years to two years kind of a revenue. We're quite confident that we should be able to achieve it in this year as well. Sir, lastly, with the given capacities which we have, so how much maximum revenue we can do? Capacities in the terms of, Kamlesh, can you please elaborate? Let's say, the working capital wherewithal which we have and the 5,000 tons of capacity which we had highlighted in our presentation, or the space which we have available. How much maximum or optimization of revenue we can do on a yearly basis? See, Kamlesh, current working capital facilities can be enhanced if we get the orders. We can't say that. There is no static-ness in that. Capacity as such is a flexible term. Okay. Got it. Thanks a lot, sir. Thank you. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Mr. Akshit Gangwal from IIFL Capital. Please proceed. Yeah, hi. Thanks for the opportunity. Just wanted to check on the status of the two big projects, Reliance and HPCL. Are we on track? Last time, I think you had mentioned 3Q, 4Q of this year. Are we on track with those projects? Hi, Akshit. Yeah, the project execution is going on in full swing and both the sites at HPCL and Reliance, we've deployed the necessary manpower at site to ensure that things go on track and go on time. Definitely they would be delivering the revenues in terms of Q3, Q4, and finally, worst case, in the Q1 of next financial year, we'll be able to complete both the projects. Yeah. Understood. Since these projects make up most of your order book, I would assume that and the newer ones as well. These are the ones that will give you the margin jump going from 3Q onwards as well, right? I mean, yeah. Basically, we have changed the accounting methodology to ensure that we don't have that kind of a EBITDA variation or EBITDA depending on the outputs or the deliverables, so that we would see basically a constant EBITDA from Q3 onwards. Right. Since we have the margins for 1Q were quite low, and similarly for 2Q also, from what I gathered from earlier comments is that 2Q will also see some pain. From 3Q onwards, we will need a jump in margins, right, to get to the 13%, 14% guided range. Yeah. That's correct, Akshit. Also, because of the revenues also would be larger, so that will also have a compensating effect because Q1, generally, the revenues are much lower. Right. Understood. Sir, just the jump in the employee costs net of ESOP that you mentioned, about 15.5%. 4Q was a big drop. The reasons mentioned were change in employee remuneration plans, bonuses, and all of those reasons. Why the jump again this quarter? Basically, the increment is given in the first quarter of the financial year. That indicates the jump. Also, we have added more manpower in terms of the execution and also to get up to the new pipeline. These are the two major reasons. What you mentioned about the last quarter of the last financial year, it's because we didn't give incentives for the previous year, considering the overall performance. Understood. going forward, net of these incentives now, since 1Q is done with the incentives and no more ESOPs as well, what can be the expected employee cost range that we can consider? See, we can't predict the range as such right now, because as Mr. Kamlesh said, these two big projects are getting finalized in this quarter. We may have to hire certain critical personnel, depending on the requirement. We can say that the employee cost will be optimally managed and as per the industry standards, the percentage will be within the limits. Understood. Sure. Just one final question on the order pipeline again. You mentioned about INR 3,000 crores of order finalizations expected in FY 2026. Since our current order book should get exhausted by one QFY 2027. What is the expected conversion ratio that you're looking at out of these INR 3,000 crores? I understand you mentioned 1.5x, 2x of revenues. Still, going forward, if we have to build in our numbers based on what the order book could look like, what the execution cycle will be, because the current order book getting executed by one QFY 2027, then beyond that, given the project execution cycles, everything, how should we build our estimates? What could be basis? No orders in the current quarter as well. Going forward are the ones that we'll see the newer ones coming in, right? Yeah, Shashi, historically, our hit rate has been about 25% of whatever has been finalized. Just as I said in the Q1, there was already one last finalization, which we have lost. The balance hit rate we can see. We expect a better hit rate in comparison with that because we've already lost one job in the Q1. In terms of the execution, yes, Q1, but some of the commissioning and et cetera could also spill to Q2 of next year. That's why we are confident that we'll have enough order backlog by the end of this year. Okay, understood. That's it from my side. Thank you so much. Thanks, Shashi. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is on the line of Paresh from IMAP India. Please proceed. Mr. Kamath, who would be the competitor companies who participate in this BPCL bid and also in the Reliance and HPCL bid? HPCL was Thermax and Reliance was Technip. In BPCL, Bina, it is Larsen & Toubro. Practically, there was only one competitor in all these three bids. Okay. Yes. Okay. Thank you. Thank you. As there are no further questions, I would now like to hand the conference over to Mr. Akshit Gangwal for his closing comments. Over to you, sir. Thank you, Shruti. On behalf of IIFL Capital, that concludes the conference. I would like to thank the management for their time and giving us the opportunity to host the call. Thank you everyone for joining us, and you may now disconnect your lines. Okay. Thank you. Thank you, Akshit Gangwal. Thank you, everyone. Thank you, everyone. Thank you. On behalf of IIFL Capital Services Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.