Ladies and gentlemen, good day and welcome to the Larsen & Toubro Limited FY 2023 earnings conference call. 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 phone. Please note that this conference is being recorded. I now hand the conference over to Mr. P. Ramakrishnan. Thank you, and over to you, sir. Thank you, Faizan. Good evening, ladies and gentlemen. A very warm welcome to all of you into the Q4 and FY 2023 earnings call of Larsen & Toubro Limited. We will have with us on the call today our whole-time director and group chief financial officer, Mr. Shankar Raman. The earnings presentation was uploaded to the stock exchange at our website around 6:00 P.M. Hope you all had a chance to look at the numbers and the presentation content as well. As per usual practice, instead of going through the entire presentation, I will take you through the key highlights for the quarter in the next 30 minutes or so, and post which myself and Mr. Shankar Raman will take the Q&A. Before I start, a brief disclaimer. The presentation, which we have uploaded on the stock exchange and our website today, including the discussions that we will have in this call, contains or may contain certain forward-looking statements concerning L&T Group's business prospects and profitability, which are subject to several risks and uncertainties, and the actual results could materially differ from those in such forward-looking statements. During FY 2023, the Indian economy continued to display a surprising resilience, despite the continuing geopolitical uncertainties globally. Most of the Indian high-frequency economic indicators are continuing to exhibit, growth momentum. PMIs and industrial activity, power demand, credit growth, investment indicators, mobility indicators, passenger and cargo traffic data, et cetera, are all pointing towards a stable macroeconomic environment. However, the discretionary consumption spends have continued to remain a bit of lackluster. The tax collections for the government have continued to remain strong and the balance sheets of the banks as well as private corporates are healthier. Clearly, most of the Indian macro indicators, be it growth, current account, fiscal deficit, as well as inflation, are relatively better vis-à-vis other countries in the world. Within GCC, one of our primary geographies besides India, we also see many countries building their non-oil economy by investing in areas like water, green energy, at the same time continuing to ramp up their spend on oil and gas investments. These are definitely interesting times where despite the continuing global turmoil, both India and GCC remain relatively stable. Before I get into the details of the financial performance parameters, I would like to share a few important milestones and highlights for the year. For the first time ever, our group order inflows have for the FY 2023 has crossed INR 2 trillion. Secondly, our order book at around INR 4 trillion is obviously at a record high. Our group revenues for the FY 2023 at INR 1.83 trillion has registered a growth of 17% on YoY basis, once again a five-year high. We have reported an NWC to revenue. This excludes financial services segment. The NWC to revenue at 16.1% as on March 23 is again the best reported in the last 5 financial years. Finally, our recurring PAT for the year has crossed the INR 100 billion mark, again an important milestone for our group. A few other important highlights for the year are, we successfully concluded the merger of L&T Infotech and Mindtree in Q3 FY 2023. The combined entity, which is LTIMindtree, with an annualized revenue currently at $4 billion, possesses the capabilities of a tier 1 company and yet retaining the agility of a next-tier firm. Similarly, our technology services company, LTTS, also crossed the revenue run rate of $1 billion during the last quarter. Further, LTTS has successfully absorbed the Smart World & Communication business of the parent. The transaction got completed on April first, 2023. The expertise of Smart World & Communication and the communications business in communications, envisioning and creating smart and safe cities, power and cybersecurity services, and 5G enterprise solutions offer ideal synergies for LTTS in 3 out of its 6 bets they are placing in the future, which are electrical, autonomous and connected vehicles, 5G, medical technologies, digital products and artificial intelligence, digital manufacturing and sustainability. During the year, the commission, the company, commissioned a pilot green hydrogen plant at its Hazira campus, marking its entry into the green hydrogen business. The pilot plant produces 45 kgs of high purity green hydrogen daily. Additionally, the company has entered into a technology license agreement with McPhy Energy, France, for manufacture of pressurized alkaline electrolyzers. The company has also entered into an MoU to develop floating green ammonia projects for industrial scale applications with the Norway-based H2Carrier. With the conclusion of the sale of the mutual fund business and a phased reduction of the wholesale loan assets book, L&T Finance, a listed subsidiary, will also transform into a full-scale, retail-oriented, digitally enabled business. The reality business of the group, in addition to development and monetization of existing land banks, will continue to pursue growth in residential and commercial through multiple formats. During the year, the company entered into an agreement with CapitaLand India for developing 6 million sq ft of prime office space in Mumbai, Chennai and Bengaluru. Finally, the IDPL divestment was also announced during FY 2023. The transaction closure, however, is subject to regulatory approvals and should get concluded in the next one or two quarters. I will now cover the various financial performance parameters for FY 2023. Our group order inflows for FY 2023 at INR 761 billion registered a YoY growth of 3%. Within that, our projects and manufacturing business secured order inflows of INR 611 billion for Q4, around the same levels as that of the Q4 of the previous year. Our Q4 order inflows in the projects and manufacturing portfolio are mainly from infrastructure, hydrocarbon and defense segments. During the current quarter, our share of international orders in the projects and manufacturing portfolio is at 43% vis-a-vis 39% in Q4 of last year. Our share of private orders within the projects and manufacturing portfolio is at 18% for FY 2023 vis-a-vis 22% in the corresponding quarter of the previous year. Coming FY 2023 as a full year, our group order inflows at INR 2,305 billion has registered a strong growth of 19% over the previous year. We had given a guidance in this particular parameter. We had given a guidance of 12%-15% at the start of the year, our actuals has been in higher of 19%. Within this total order inflow, our projects and manufacturing businesses have secured orders of INR 1,722 billion for the year, growing by 19% on a YoY basis. The share of private orders FY 2023 in this portfolio, that is the projects and manufacturing portfolio, is at 27% vis-a-vis 22% in the previous year. The share of international orders is at 28% as against 37% in the previous year. The year witnessed booking of some noteworthy orders in domestic irrigation projects and wastewater project in the water and effluent treatment business. A project in public space, public spaces business in the buildings and factories vertical. A few orders in the hydel and tunnel business, including a lift irrigation project. A strategic order in the heavy civil infrastructure business. Apart from this, a couple of orders in ferrous metal space, some select large orders in the defense business, and a large order in the onshore vertical and multiple orders in the offshore vertical of the hydrocarbon engineering business, were all secured. Moving on to the prospects pipeline FY 2024. We have a total prospects pipeline of INR 9.73 trillion FY 2024, as against INR 8.53 trillion that we had announced at the start FY 2023. This by itself represents an increase in the prospects of almost 14%. The broad breakup of the overall prospects pipeline that I just now mentioned at INR 9.73 trillion. Infrastructure comprises INR 6.5 trillion, hydrocarbon at INR 2.44 trillion, power at INR 0.5 trillion, and high-tech manufacturing at INR 0.29 trillion. Moving on to order book. Our order book is at INR 3.99 trillion as on March 23. As our projects and manufacturing is largely India-centric, 72% of our order book is domestic and 28% is outside India. Of the international order book of INR 1.11 trillion, around 87% is from the Middle East countries, 4% is from Africa, and the remaining 9% from various countries, including Southeast Asia. As is evident from the statistic, GCC CapEx for both infrastructure and hydrocarbon sectors is on an upswing, post the recovery in oil prices. The breakdown of the domestic order book of INR 2.88 trillion, which is 72% of our order book, the breakup is as follows. The share of central government order is 14%, state government 30%, public sector units or state-owned enterprises at 36%, and private sector at 20%. Around 22% of our total order book of INR 3.99 trillion is funded by bilateral and multilateral funding agencies. Around 89% of our order book is from infrastructure and energy. You may refer to the presentation slides for further details. During FY 2023, we have deleted orders of INR 53 billion and INR 103 billion respectively from the order book. As of March 23, our slow moving orders in the order book is around 1%. Coming to revenues. Our group revenues for FY 2023 at INR 583 billion registered a YoY growth of 10%. International revenues constituted 39% of the revenues during the quarter. The IT and TS portfolio continued to report an industry-leading growth in Q4 as well. In the projects and manufacturing businesses, our revenues for FY 2023 were at INR 433 billion, registering a YoY growth of 8%. For the full year, we reported group revenues of INR 1.83 trillion, a growth of 17% largely achieved on the back of a pickup in the execution momentum in the projects and manufacturing businesses and a healthy growth in the IT and technology services business. For revenues, if you may recall, we had given indicated a guidance of 12%-15% growth at the beginning of the year. Moving on to EBITDA margin. Our group level EBITDA margin without other income for FY 2023 is 11.7%, a drop of 60 basis points over FY 2022. This drop of 60 basis points is mainly due to cost pressures in the projects part of the portfolio. FY 2023, this drop is 30 basis points. That is from 11.6% FY 2022 to 11.3% in the current FY 2023. The detailed breakup of the EBITDA margin, business-wise is also given in the annexures to the earnings presentation. You would have noticed that the EBITDA margin in the projects and manufacturing business for FY 2023 is at 9.2% vis-a-vis 10.3% in FY 2023 as a whole is at 8.6% vis-a-vis 9.3% FY 2022. Against the margin guidance of 9.5% that we provided at the start of the year, we have fallen short by 90 basis points, which is, as I said, largely attributed to cost pressures in the EPC projects part of the portfolio. I will cover the details when I talk about the performance of each of the segments. Our recurring PAT for FY 2023 at INR 39.9 billion is up 10% over Q4 of last year, largely in line with the revenue growth during the quarter. Similarly, our recurring PAT for the year at INR 103.7 billion is up 21% FY 2022. The group performance P&L construct, along with the reasons for major variances under the respective function heads, is provided in the earnings presentation. You may kindly go through the same for further details. Coming to working capital. Our NWC to sales ratio has improved from 19.7% in March 2022 to 16.1% in March 2023. We have done substantially better vis-a-vis the guidance of 20%-22% that we gave at the start of the year. Further, the GWC to revenues FY 2023 has dropped sharply to 62.3% as against the GWC to revenue FY 2022 at 73.4%. Our group level collections, excluding the financial services segment for FY 2023, is INR 539 billion vis-a-vis INR 430 billion in FY 2023, our group level collections, excluding financial services segment, is INR 1.7 trillion vis-a-vis INR 1.36 trillion FY 2022, representing an increase of 25%. The improvement in gross working capital is also reflecting in the net working capital. Receipt of customer advances towards the orders received during the year also helped extend the net working capital drop. Our gross debt to equity ratio for FY 2023, the close of FY 2023 is 1.14, as against 1.29 at the end of FY 2022. Our return on equity for FY 2023 is 12.2% vis-a-vis 11% for FY 2022, an improvement of almost 120 basis points. I will now comment on the performance of each of the business segment before we give our final comments on the outlook for the medium term. First would be the infrastructure segment. Coming to order inflows, this segment secured orders of INR 412 billion for Q4 FY 2023, registering a degrowth of 9%. That is primarily due to a high base of the corresponding quarter of the previous year. Full year order inflows in this segment were at INR 1,171 billion, reporting a substantial growth of 25% FY 2022 on receipt of multiple large value orders across all the sub-segments under this particular business. During the current year, buildings and factories benefited from receipt of some prestigious orders in the public space business. The heavy civil infrastructure registered growth on the receipt of a mega infrastructure order, and the water and effluent treatment business also received numerous orders for irrigation and wastewater treatment. The minerals and metals business performed well with the receipt of multiple ferrous orders from a private client. For two years in a row, the power transmission business has continued to benefit from the gigawatt scale renewable opportunities from the GCC region. The decline in order inflow in transportation infrastructure for the year is mainly due to deferral of targeted prospects. Coming to order prospects for this infra segment, for FY 2024, it aggregates to around INR 6.5 trillion, vis-a-vis INR 5.72 trillion as at last year. The breakup of domestic in the total order prospects of INR 6.5 trillion, the share of domestic is INR 5.19 trillion, and the balance international prospects of INR 1.31 trillion. The sub-segment breakup of total order prospects in infrastructure business is as follows: heavy civil infra 21%, water and effluent treatment at 22%, transportation infrastructure at 19%, power transmission and distribution at 18%, buildings and factories 13%, and minerals and metals at 6%. The order book in this segment is INR 2.845 trillion as on March 23. The book bill for infra is around three years. The Q4 revenues at INR 312 billion registered a growth of 5% over the comparable quarter of the previous year, FY 2023 revenues at INR 867 billion registered a strong growth of 20%, largely aided up by the ramp-up of execution of large orders in the portfolio. As a philosophy, we always step up execution when customer collections are flowing at a healthy pace, to essentially strike a healthy balance between P&L and the balance sheet. Our EBITDA margin in this segment for FY 2023 at 7.5% registers a degrowth of 170 basis points over the corresponding quarter of the previous year, whereas the full year EBITDA margin at 7% registers a decline of 120 basis points. Margins for the quarter and the year remain subdued due to job mix of largely government, public sector tender projects under execution, input price pressures, logistics constraints, cost overruns in certain jobs, pending delay in the customer claim settlements. Our client claims will be pursued under the terms of the respective contracts, the settlement of which will happen over time. Moving on to the next segment, which is energy projects, which comprises of hydrocarbon and power. Receipt of multiple domestic and international orders in the hydrocarbon business during the year, improves the order book, whereas deferral of orders continued in thermal power. We have a strong order prospect pipeline of INR 2.94 trillion for this energy segment FY 2024, comprising of hydrocarbon prospects of INR 2.44 trillion and power prospects of INR 0.50 trillion. The order book for this energy segment is at INR 724 billion as on March 2023, with the hydrocarbon engineering order book at INR 670 billion and power at INR 54 billion. The book-to-bill for this segment is around 20 months. The Q4 and FY revenue growth of 18% and 6% respectively is really largely led by the execution momentum in hydrocarbon, whereas lower revenues in power is a function of a depleted order book. The improvement in EBITDA margin in this segment for the quarter and full year is largely a function of execution cost savings in both the segments. Further favorable customer claim settlement in hydrocarbon in Q4 FY 2023 also aided the improvement. We'll now move on to high tech manufacturing segment, which comprises of heavy engineering and the defense engineering businesses. In this quarter, order inflow growth in defense engineering is driven by the government's trust towards indigenization, whereas heavy engineering ordering was impacted due to deferrals. For the full year though, both defense and heavy engineering have benefited from multiple order wins. We have an order prospect pipeline of INR 252 billion for this segment FY 2023. The share of defense against this pipeline is around 78%. The order book for this segment is INR 262 billion as on March 2023. Revenues for Q4 and full year for this segment registered a growth of 21% and 10% respectively, largely attributed to higher progress in the refinery business of heavy engineering and execution ramp-up of select projects in the defense engineering business. Margins variance for the quarter vis-a-vis corresponding quarter of the previous year is largely a function of the job mix in this segment, whereas full year margin variance has some element of execution delays arising out of supply chain issues. While I am on this segment, I would like to mention once more that the defense engineering business of Larsen & Toubro does not manufacture any explosives nor ammunition of any kind, including cluster ammunitions or anti-personnel landmines or nuclear weapons or components for such munitions. The business also does not customize any delivery systems for such munitions. As you are all aware, the merger of LTI and Mindtree merger got concluded on November 15, 2022. The merged entity is uniquely positioned to scale up by competing for large deals and will benefit from cost and revenue synergies on upselling, cross-selling and stitching services together. The revenues for this segment for the quarter at INR 106 billion and the full year at INR 407 billion registers a growth of 21% and 26% respectively over the corresponding period of the previous year, largely reflective of the continuing growth momentum in the sector with a surge in demand for technology-focused offerings. The margin decline in the segment for the quarter is a function of higher staff cost, whereas for the full year, the margin was impacted to a combination of higher employee costs as well as one-time integration expenses due to the merger of the two companies. I will not delve too much on this segment as both the companies in this segment are listed entities and the detailed fact sheets are already available in the public domain. We move on to the financial services segment. Here again, L&T Finance Holdings is listed, and the detailed results and the fact sheet are already available. The highlights for FY 2023 for financial services segment were improved net interest margin and fees, lower credit costs, better asset quality and rundown of the wholesale and expansion of the retail loan book. In fact, as on March 23, the share of retail in the overall book at around INR 80,000 crore is at 75%, 75% of INR 80,000 crore. The strategic deliverables in this business revolve around portfolio reorganization, strong asset quality and improvement in ROA. This business endeavors to be a top-class digitally enabled retail finance company, moving from a product focus to a customer focus approach. Finally, to conclude, sufficient growth capital is available in L&T Finance balance sheet. Moving on to development project segment. This segment currently includes the power development business comprising of the thermal power plant Nabha Power, L&T Uttaranchal Hydropower up to the date of its divestment previous year, August 2021, and Hyderabad Metro. Let me mention here that profit consolidation of L&T IDPL at a PAT level has been discontinued from FY 2023, post signing of the definitive agreement for sale of our entire stake in the company. The investment in this JV is now classified as held for sale. The majority of revenues in the development project segment is contributed by Nabha Power. Improved ridership in Hyderabad Metro and higher PLF in Nabha drive revenue growth for this segment. To give you some statistics on Hyderabad Metro, the average ridership improved from 1,99,000 passengers a day in FY 2022 to 4,08,000 passengers per day in Q4 FY 2023. Our average ridership in Q3 FY 2023 was 3.94 lakh passengers a day. Average ridership for Hyderabad Metro in FY 2023, that is the whole of the year, was at 3.61 lakh as compared to 1.55 lakh in FY 2022. The higher segment margin in Q4 FY 2023 is primarily due to consolidation of Nabha profits, led by increase in the benchmark valuation. The Metro at a PAT level, we have consolidated a loss of INR 13.21 billion in FY 2023 vis-a-vis loss of INR 17.51 billion in FY 2022. The interest cost in the Metro SPV has reduced from INR 14.77 billion FY 2022 to INR 12.73 billion FY 2023, largely reflective of the benefits of refinancing which got concluded in the previous year. Moving on to other segment. This segment comprises realty, industrial world, Smart World & Communication, construction equipment and mining machinery, and rubber processing machinery. The Q4 FY 2023 growth in this segment is mainly in realty, rubber processing machinery, as well as construction equipment and mining machinery. The Q4 FY 2023 margins of this segment is in line with the corresponding period of the previous year. Before I conclude on to the environment outlook, I want to draw your attention to two new slides which we have included in the annexures to the earnings presentation. The first slide is how return ratios have improved in the projects and manufacturing portfolio over the last five years. If you glance through the numbers, you will realize that a combination of revenue growth and a reduced capital intensity in this projects and manufacturing portfolio has offset the margin side and actually resulted in improved return ratios over time. As I say this at the cost of maybe I'm sounding defensive margin, I would like to mention that the delays and disputes on additional claims from clients has created in some sort of a timing mismatch in the books, consequently impacting margins in the shorter term. Hopefully, the benefits will accrue to PNL as and when the claims get processed over time. There is one more slide as part of the annexures to the earnings presentation, which explains the journey of return ratios to group level. In this slide, we have listed out three action points for ourselves as part of our Lakshya 2026 track plan to improve the returns to our shareholders. If you see that it covers the portfolio, the emphasis is on the portfolio reutilization of financial services, at a paced exit are reducing exposure from our development projects portfolio and a higher cash return to shareholders over the period. Coming to the last part of my presentation, which is the outlook. India's economic growth continues to display encouraging resilience despite the continuing global chaos. Prudent fiscal and monetary policy management from the government and RBI respectively has resulted in the partial decoupling of India growth story with the rest of the world. The government's push for growth through larger infrastructure spend is clearly evident from the enhanced budgetary allocations for FY 2023, 2024. PLI incentives, improved business confidence and buy-and-come demand conditions will culminate into revival of private CapEx in the medium term. Going forward, improved tax collections for the government will support its CapEx-led growth aspiration. Further bank balance sheets are healthy, providing opportunities to lend funds to creditworthy projects. With the government's enhanced trust towards manufacturing exports, the country's goods trade deficit should narrow over a period of time. The country is committed to net zero goals, and both the government and the private sector are committed to investments around energy transition. Amidst these various moving parts, the silver lining is that India would come continue to remain one of the fastest growing economies in the world. The last two years has seen the global economy striving to deal with, overlapping crisis, the latest being the liquidity troubles after a series of global bank crisis. While the impact appears to have been contained, these uncertainties continue to undermine the confidence among consumers and businesses to spend, possibly impacting global growth. Government and central banks across the world are attempting to strike a balance between containing cost-plus inflation and pursuing demand-led growth. A combination of China's reopening, a significant easing of the natural gas crisis in Europe, and a resilient U.S. consumer confidence should help the global economy, tide over the current uncertainty overhang. With OPEC and partner country, countries announcing, production cuts, oil prices are likely to remain firm at current levels, aiding the GCC nations to pursue their CapEx plan in oil infrastructure, green energy and other industrial sectors. In this backdrop, the company will focus with cautious optimism on pursuing large project wins, timely execution of its large order book, growth of its services portfolio in the stated glide path, and preservation of liquidity and optimum use of capital and other resources. The company is optimistic about its growth aspirations in the medium term despite this uncertain macro environment, and is committed to creation of sustainable value to all of its stakeholders. Finally, let me comment on our guidance for the next year before we take Q&A. On ordering flows, this is at a consolidated level, that is at a consolidated group level. Our guidance is around 10%-12% band FY 2024. On consolidated revenues, we are providing a guidance of around 12%-15% band in FY 2024. On margins with respect to our projects and manufacturing business, we closed the FY 2023 at 8.6%. It is our endeavor to improve the margins of around 40 to 50 basis points, maybe in and around 9% FY 2024. Having said this, the margin trajectory should be showing a good improvement in the later part of FY 2024. In terms of the projects that will come and cross the margin recognition threshold, we see the later part to be a more profitable second half than the first half. On working capital, we are giving a guidance, a range between. This is again working capital at a group level. The guidance would be between 16%-18% FY 2024. On the sustainability front, the parameters FY 2023 are undergoing audit currently. We will be presenting you the same when we come with our FY 2024 earnings presentation. Thank you, ladies and gentlemen, for the patient hearing. We will now open the floor for questions. Both myself and Mr. Shankar Raman will be taking the questions. Requesting the participants to restrict their questions around the broader aspects of performance and strategy in order to make the best use of the available time. Any bookkeeping questions can be taken up with the investor relations team later on. Over to you, Faizan. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. 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 Mohit Kumar from ICICI Securities. Please go ahead. Yeah. Good evening, sir, and congratulations on a very, very strong order inflow. However, sir, the EBITDA margin has been slightly lower side. My first question is the EBITDA margin for last three years for the core segment is 10.3%, 9.3% and 8.6%. It has been continuously declining. As a result, EBITDA, you know, growth, if you look for the last three years, for the core business, is around 7%-8%. Please pick margins or, you know, to improve FY 2024 materially in the sense some of the losses which you incurred FY 2023 or let's say the COVID period will come back FY 2024 and will improve slightly in the higher side, 50 basis points, 40-50 basis points, look to the lower side. That's the first question. Mohit, Shankar Raman, good evening. Good evening. you know, you have chosen a very interesting three-year period to do your margin profiling. Okay? This has been the most challenging three-year period for EPC companies, as you will know. You know, the margins that we have reported now largely reflect the cost of inputs that have gone into the execution. To a limited extent, we were able to sort of fine-tune the time that is available at our hand to complete the project, waiting for the prices to cool down. But it was not possible across the length and breadth of the project business that we run. We had to actually go ahead, complete the project, make sure that we don't get into the LD zone and complete our obligations. As you know, in project business, the margins are not linear because, A, there are milestones, and B, there are various gaps for margin recognition and contingencies, cost contingencies. C is finally, at the end of the project, there is always a negotiation around any of the scope creep, time cost overrun, et cetera, et cetera. It does take the project completion plus 12 months to actually get the final outcome of a project. While it is true that as the projects are getting more and more complex, competition is increasing, the margins never used to be the same that we used to be because world is getting far more competitive. There's no doubt in my mind that the 10%, 12% margins that we used to comfortably enjoy, is not there for some time. I think we need to learn to operate, efficiently, in a lower margin band. What can be the compensating levers? One is the complexity of the project that we can bid for, where there is a higher engineering overlay, which will give you some competitive advantage and keep the bar, higher. Second is, how to ensure that the time erosion that happens in project execution, improves and to the extent to which we could have pre-bid arrangements with our entire vendor ecosystem so that the margin erosion is just not confined to the EPC player, but the chain bears the cumulative burden but in a more distributed, manner. Third obviously is I think, as we broad base our presence across geographies, we have to make sure that there is sufficient cushions that are available in the various markets that we operate in. The timing mismatch is part and parcel of our business unfortunately, because the cost gets incurred first and then the negotiations happen for final settlement. Except that the cost gets accounted in a lumpy manner and the benefits driven, drip in a phased manner, so you don't even realize the recovery that happens in this. The sustainable lever that we are operating on, and it's very visible even in FY 2023, is how to reduce the capital intensity. I think we should either run a business where the margins are very high, so you can afford to actually be less rigorous on capital allocation. The other scenario where margins are trending lower because of general competitive environment, economic landscape, et cetera, et cetera, and hence get far more efficient in resource deployment. When I talk about resource deployment, it's just not money, but money, men, material, et cetera, et cetera. Also the fact that we increasingly are getting to automate our processes, trying to use digital technology in our, you know, project-related manufacturing equipments, and also have modular fabrication so that we operate on a batch mode rather than on a sequential mode. These are levers that will take some time to seep in into the organization. If we just allow the cost increases to play out, it would have been far sharper fall than what we have managed because of all these compensating levers which have all got at various degrees of maturity. We do believe in the next couple of years, two things will happen. Hopefully, we'll perfect this model of getting less resource-intensive and get more cost competitive and more operationally efficient, reduce the rework time, reduce the downtime, et cetera. B, is the backlog that is actually suffering the higher input costs would have got exhausted by then. According to me, 60% of the backlog that had large cost inflation has got exhausted during the current year. The balance will spread over possibly next year and the following year. My belief, as Mr. Ramakrishnan was mentioning, the subsequent two quarters will continue to see cost pressures and softer margins. As we tide over, turn over that phase and cross the hump, then possibly the margins will begin to look up. 2024, 2025, my assessment is, it'll be a more accurate reflection of a normalized execution. Sorry for the long answer, but it deserved it. Thank you, sir. My second question is, when you look at your green manufacturing portfolio, what are we aiming in FY 2024? What is the capacity we are looking for the electrolyzer? The related question is that, are we getting more and more inquiry for the EPC for the green hydrogen, green ammonia or green manufacturing plant? We are working on a capacity of 1 GW for electrolyzer. As you know, we have tied up with McPhy for technology licensing. The factory is getting set up now. We do believe by the time this financial year runs out, we would have produced a few electrolyzers. Initially it would be a product used in India, but we do believe it has potential to be a global product. We should get the technology right, we should get the costing right, et cetera. Our sense is that FY 2024, end FY 2024, the electrolyzer plant will be up and running, meaning commissioned. We have not exactly chalked out how many units we will produce, et cetera, because that will be a function of marketing and product development. Insofar as EPC is concerned, I think, the world is actually beginning to come to terms with the green hydrogen. It is still not, according to me, widely implemented. It is widely spoken. I think there is enough pressure in the system for people to get more green in their fuel efficiency and fuel usage, et cetera. This trend will begin to pick up. My own sense is it'll take 0 to 3 years for us to see some scaling up happening in this opportunity. At the moment, what we are trying to do is we're trying to stay relevant to the technology and the developments around. We are having conversation. Maybe if the initial movers in this, for example, groups like Reliance have announced plans to manufacture, and given our EPC competence and also our electrolyzer manufacturing capability, if we are able to get some initial orders, maybe couple of INR 1,000 crore could be the initial orders that we could get in this area. 2024, 2025 would be a more appropriate time for us to actually seize this opportunity, Mohit. Understood, sir. Thank you. Best of luck, sir. Thank you. All the best. Thank you. The next question is from the line of Ashish Shah from JM Financial. Please go ahead. Good evening, and thank you for the opportunity. My question is on the guidance. While of course, 12%-15% revenue growth guidance is good guidance, given the fact that we are sitting on a record order book and our working capital cycle is probably at the lowest point in several years, do you think this is a tad conservative and there is a potential to do better? You think given the constraint, this is the correct number to look at? There is a event risk, at the moment, Ashish. There's many states are going for elections. Country will be geared for union election. So far things have been progressing well because, the enablers for project execution has been much better, in terms of environment. We have to be a little guarded in the current year. My own sense is it could be a bit of a truncated year, may not have the full benefit of 12 operating months. I really do not know how many months in the current year and how many months in the next year we'll actually get into some kind of a silent period, so to speak, for large moves, by the government. Secondly, the finance minister is blessed with a high degree of compliance and willing taxpayers. Today, I think the physical conditions look very, very rosy. If the allocations change track because of some political priorities, some of these projects can get little slower. The while the apparent implication of this in order inflow is understandable, the operations in infrastructure, public space, is always fraught with some risks of, you know, access, clearances, multiple agencies, to give progress enabling approvals, et cetera. If the bureaucracy slips into some kind of a political prioritization mode, then some of these could get affected. We also have to see the war seems to be escalating, at least the last 1 week. Whatever normalcy we thought the level of escalation will happen has got completely changed, and it is getting into another pitch of, you know, rivalry and attacks and stuff like that. I do not know how much more supply chain disorientation is going to happen. And, and, we do for our project business, do a fair bit of equipment supplies from international markets. We want to be a little careful here. This is not to say that there's no upside. For example, in the current year we said 12%-15%, but we landed up with about 17%. Our effort would always be to beat margins, but so early in the year we felt that it's better to be a little more sure-footed than adventurous on the guidance. Sure, sir. Got that point. Thank you for that. Just last question on the defense. We have got a pretty good inflow for the fourth quarter. You know, I just want to get some color on this because there were a few programs where we were, in the, you know, frontline. There's a cadet training ships, there's the modular bridges, the Vajra gun orders. I just want to know which of these programs is, has been received and which is, yet to be taken in the inflow. Also in the pipeline, we've again talked about of a fairly good number in terms of prospects for defense. Any broad color on which programs are we, are we eyeing at? That will help, sir. Thank you. There are multiple programs. Some are land-based army systems, and some are naval systems, as you know. Given the confidentiality with which we are bound on FY 2023 wins, I'm not able to call out specifically as to which program is winning. Suffice to say, both the naval programs and the land-based programs are on course. I think the government is getting comfortable with private sector participation. Still early days. I don't think a few orders should make us conclude that it's going to be a up and running volume. We'll have to wait and watch. These are areas where we have capabilities. To that extent, at the moment, let me be a little circumspect in calling out, but all the programs that you mentioned are alive, and these are continuing programs. None of these programs is actually a one order program. Our hope is that we will continue to keep receiving some of these orders going forward because the services requires these quite badly. Yeah, sir. Thank you. Thank you for your responses. Thank you. The next question is from the line of Renu Baid from IIFL Securities. Please go ahead. Yeah. Good evening, sir. My first question is on the cash utilization and the asset divestment. Now with IDPL almost done and hopefully Nabha also closes in fiscal 24, given that you have readjusted the net realizable value there. How are we looking at the overall cash chest of the books for the de-leveraging coming in place? With this reduced networking cycle that we are seeing because of a structural growth or cyclical growth in orders, how are we looking at the overall utilization of these proceeds, any M&A in pipeline, et cetera? Actually, insofar as M&A is concerned, we have so far been scaling up in the IT services. In the core business of engineering, construction, manufacturing, we think we have much of the competencies better than most available. To acquire another company in those core areas, unless it completely changes the competency profile or the threshold mapped for prequalification, I don't think we are thinking in terms of any such major buying. At the moment, the focus is 2. One is to complete the divestments that we are working on. You mentioned about Nabha. As I mentioned to you, possibly in one of the earlier meetings, Nabha is a unique asset. It's a fantastic asset by it, by itself, and it is being put to good use in Punjab. The problem with Nabha is that it has been constructed at a cost which is far higher than the cost at which power capacities are available through NCLT proceedings. To that extent, I think it suffers from some competitive disadvantage when it comes to being sold out in the market. Having said that, what we have done in Nabha is some very good effort in making sure we are closing all the litigations. Significant litigations have been won and money collected against those litigations in the last year. There are one or two which are still left, and we'll continue to endeavor to get them also resolved. If we keep the plant running as well as we are doing now and take all the litigation related discounts out of the equation, we might possibly find interested people for a performing asset. When you buy an asset through the NCLT process, et cetera, you have to incur a fair bit of expenditure to revamp the plant. Many of these plants have remained shut for long, et cetera. Who knows, there might be an interested party who could possibly aggregate his non-green capacity. The fact is we are trying to sell non-green at a time when everybody is talking green. There's going to be a bit of an effort required. At the moment, it is not hurting us in terms of either utilization of the asset or the margin that it is contributing. Whereas, if I look at IDPL, you are right. I think we're almost home. We have to make sure all the various approvals that we need to get, we get in good time, and hopefully we'll close it in the course of this year. The core businesses are expected to generate good cash. We work very hard to make sure that the capital intensity, resource intensity, we have brought it down. Even though we surprised ourselves in getting to 16%, I think it is safer to plan to operate in that 16%-18% band. We have seen that pattern in the past because generally the first two quarters would involve lot of vendor payoffs. Thereafter, customer cash flows get stronger in Q3 and Q4. There could be some ratio movements, but it will be within this band. If the cash flows are good and the debt servicing, I do not think would require a lot of cash, because anyway, the parent company, if you keep aside the Hyderabad Metro and the Nabha Power Plant debt and keep aside the financial services debt, the parent company has very low debt, 0.2 to 1 is the kind of debt equity. I don't think there's substantial debt to be done. There will be some strategic assets that we might have to invest in because of the kind of orders that we are trying to procure. For example, when we got lot of metro work, especially underground, we had to invest a lot in tunnel boring machines. We hardly used to have any now. We are almost having two dozen now. These are expensive equipments. Likewise, Dedicated Freight Corridor program involved a lot of automated track laying equipments. Now, these are large investments. We do think about INR 3,000-4,000 crores worth of assets we might have to invest depending on the type of the projects. I mean, these are actually would be very contingent on the type of projects that we get. Barring this, I do not think there's going to be any significant call on the capital. We have stepped up our dividend, as you've been seeing now, it's almost 40%, in fact 42%-43% of profits earned in the standalone company is being paid. There is a move over the last couple of years to increase the dividend. We have spoken along the way. We said in FY 2026, we'll also try to do some return of cash to shareholders by means other than just the dividend payout. We had attempted for buyback in the past, we were actually pushed back by regulations at that point in time. We have time now in this period, we should be able to one of the objectives, that's covered in one of the slides that we have attached this time to the presentation deck, that one of the ways to deal is to enhance the return of cash to shareholders. That will possibly enable us to keep the cash required to optimal level within the company instead of sitting on extra piles of cash. Sure. One follow-up question, if I can ask. While it's credible the way L&T has managed its net working capital and truly industry leading, on the operating performance side, sorry to harp again, despite having the diversity of project size and scale, at the end of the day, when you've seen commodity uncertainties in supply chain, the operating performance is not very different compared to other mid-cap EPC names. Wouldn't want to take the names here. You know, what are the steps that we are trying to do so that these issues are addressed? We already have quite a bit of risk management processes, commodity hedging in place, unlike most of the other peers. Where do you think has the gap been, because of, which could be the reason for this underperformance on the operating front? See, I think, it's very difficult to compare L&T, given its history, age, maturity, cost structure, et cetera, to various EPC companies which work in the same area. You would be surprised that companies which existed 10 years ago are no more in the picture. Forget about competing with us. They're just not in the picture. We find that practices have been very varied, and I would not like to join forces to pick holes on the accounting practices and recognition practices, et cetera. We do think that EPC business is catching the tiger by the tail. You have to ride it, and you'll have to ride through several cycles. If you happen to be a company which is 80 years old, it does go through these cycles. Our own sense is that the kind of de-risking that we have achieved between geographies, between the various verticals, et cetera, provides us a requirement to keep investing in many of these areas. As I just mentioned a little while ago, I do not know how many companies would have invested in the kind of equipments that we invested on the back of projects, and that's the reason why projects are moving forward. All these are costs. The cost will get recovered only if there is consistently large projects that are being given out. It's only in the last three, four years that we have been seeing some amount of consistency in ordering, order placements, the kind of projects, the complexity, et cetera. I think we are on a cusp of a period where if you continue to see these kind of investments, the wheat will get separated from the chaff. At the moment, we might suffer by comparison, but I think it is more structural rather than, you know, efficiency in execution. Got it. Thanks much, and all the best, sir. Thank you. Thank you. The next question is from the line of Deepika Mundra from J.P. Morgan. Please go ahead. Good evening, sir, and thank you for taking the question. Sir, if you just think back on the FY 2026, strat plan, in terms of the prospect pace, which areas do you see, you know, are surprising you more positively than what you would have thought? Where do you think a greater, you know, push is required, either from government or from private sector, which has been, you know, missing your expectations? No, we are, we are midway, isn't it, Deepika? I mean, 2026, we still have to cross three more years. I think so far we have been on course. If I were to plot what we have achieved in FY 2022, what we have achieved in FY 2023, I think we have been by and large on course. What is going to be important rather than what has surprised us, et cetera, COVID surprised us. I mean, we never ever anticipated the kind of start to our strat plan. What has surprised us is our ability to actually stay the course and despite this disruption. I think, all credit to the organization that we work for, people actually put their shoulder to the ground and made sure that we are not losing our way. As far as government is concerned, the tax buoyancy has surprised us. The confidence that the country has today, in not only defending its own domestic policies, but be able to articulate internationally as to why India is a market that others should participate in. If we are able to carry this forward, that's why I felt that, it's extraordinary diplomacy and branding that India has done. If we're able to carry this forward, we're able to widen the tax coverage, I mean, footprint. Instead of 10% of the country paying the entire tax bills, if we can able to make it to 12%, 13%, 14%, 15%, if we're able to improve that and keep focus on, investments which will generate employment, which will generate connectivity. There is a pattern to the investment on infrastructure if you see, because it is enabling movement of people, movement of goods, et cetera. I do share the central government's vision that a connected country will lead to overall development and more inclusive development than what has been in the past. My sense is that if we are able to keep the political differences at bay and be able to pursue, regardless of which party actually succeeds in 2024, we're able to pursue this and do whatever I just mentioned. I think we would surprise ourselves at our potential. Many of us have been grown up thinking that India is a 4% growth country. Now, in today's time, it's not hard to imagine India at double that rate. I think a lot of work needs to be done, but the hope and optimism has gone. The country has got a lot more confident, and that has rubbed on us also. We also internally feel bit confident. There are lots of battles we'll have to win. As I mentioned, I think we are as we get older and older, we have to make sure that we unlearn and relearn. We have to make sure that the talent that got us here is obviously aging talent. We have to make sure the younger talent is able to take this company forward. We have to adopt new technologies. I think no more are we using the same methods to deliver. The clients are getting smarter and demanding. We have to make sure that we measure up to that as well. There enormous challenges ahead. It's not an easy path, but I think, I guess that's what would make the growth story of the company and maybe the country interesting. Thank you, sir. Just a second question. You know, given that we've seen consistent commodity volatility plus supply chain disruptions, do you see that differentiation in contract negotiations with clients today, both in domestic and in international markets? Do you think some of the bidding practices largely remain same as what you've been following so far? To the discerning there is a difference because people have seen us deliver despite COVID. People have seen us take knock and then hit deliver. To that extent, I think to the, to the discerning, there is a difference between what we have done under the, on the face of adversity, otherwise. If you also look at the other way that, typically the public sector units or the government-sponsored projects are done, end of the day it is L1. I think there is, some, comfort that all these agencies take in having a bid responded to by at least half a dozen people. They make the bid in such a way that more and more people can, sort of, participate. Despite a directive from the government that the bidding should not be. the bid should not be decided just based on L1, and there should be a quality and cost-based consideration, somehow the user departments, especially if it is driven by bureaucracy, is more comfortable with quantitative costs than qualitative assessments of technical capabilities. That has not played out as yet. We still have to be L1 to make sure that we make the cut. That has not changed. Because of the need to have more people participating, if the, if the thresholds do not go up sufficiently, we will have delayed projects. See, infrastructure, if India wants to be very competitive in its services, manufacturing products, goods, et cetera, it has to create infrastructure at a very competitive price. All the inputs that go into infrastructure are anyway generally market-driven, so there's nothing that you can do. What you can do is save time. Make sure that the projects are awarded to companies which are able to execute within time. My own assessment is at least 15%-20% of the cost of infrastructure in the country, we are paying more just because of either unorganized, discoordinated approvals, and all the related, you know, project clearances and the delay, inevitable delay in negotiating after the project is done. The scope gets negotiated, quantity gets negotiated, right of way and all the utility removal gets negotiated. If all of this fall in place, then there's always some public interest group which doesn't like the project. The, you take, we're not involved in that asset, but if you take even the high-speed rail, it came up to the border of Maharashtra and got stuck. Now slowly packages are being done. We have lost two years. Instead of the project getting completed, it's going to take at least three years more than the original. Who's going to pay for that extra time? It's only you and me as taxpayers and country's exchequer will pay. I think in this quest of creating competitive infrastructure, it is very, very important that we back companies which have the requisite capabilities and competencies. That is something that somehow that has not completely changed to our satisfaction at least. Okay. Thank you very much, sir. Thank you. The next question is from the line of Aditya Bhartia from Investec. Please go ahead. Hi. Good evening, sir. My question is again on intra margins, wherein the first time we had those cost overruns on the transportation side, we had spoken about possibility of getting some variations. Just want to know how has our experience been. Is it that we are getting variations and the margins that we are seeing are after accounting for those? Or is it that you're generally seeing that it's taking much longer to get those negotiations done? Aditya, we are realizing the hard way that to get these extra credits from the customer is not as easy as originally one would think. What is the customer's first priority? To get the project completed. What is our requirement? We can't go to the negotiation table without the project being completed. I think first and foremost, I'll have to complete the project, and in the meanwhile, keep filing our interest in whatever negotiation, commercial adjustments that we want to achieve. This typically happens at the end of the project. If it is, let's say a corporation like, let's say for example, I'm saying, IOCL, ONGC, et cetera, they're also worried about the decision, discretionary decision being questioned in the parliament. There often is a process involved to make a conciliation involving a third party independent person. Even assuming it is not a dispute which gets referred to arbitration, even a conciliation to close out on the veracity of the claim and, you know, validity of the claim, et cetera, that process is involved. It does take time to get all of this done. The only good part is, if our reputation is intact and we have delivered to plan, then the chances of consideration is far higher. To my mind, we don't normally recognize the claims ahead of time. We book the costs already for projects completed, only on acknowledgment by client, either in terms of, you know, accepting the liability or receipt of payment, is the margins recognized of that extra claim. It comes in in the subsequent quarters. It depends on when a project is completed. It can easily take another 6 to 12 months after the project is completed during the defect liability period for all these conversations to happen. My sense is what we have lost out in 2022 and 2023 possibly will start creeping into our books from 2024, 2025 onward, which is my assessment. It'll go in for a couple of years. The same couple of years it took to hit us, it'll take the couple of years to get back. Sure, sir. What about the past claims, in respect of some of the transportation projects, have you kind of received some money in respect of that? Some portion has happened. I think I heard my colleague talk about in the context of hydrocarbon, he was saying some claim settlement by customer. These things happen except that they come in sizes which are actually not material. They come in and then get submerged in the overall cycle of margins. Settlements are happening. We would like it to happen faster, but they're happening. Understood, sir. Sir, my next question is on Nabha Power. Should we read you reconsolidating Nabha Power into accounts as an indication that something may be happening soon over there? You are in discussions with certain parties and you're getting a feeling that realizable value is higher than the carrying value? Aditya, this is PR here. If you recall, in the quarter ending September 2020, the board of Larsen & Toubro had decided to say that Nabha Power is looking for suitors. We are looking for prospective buyers. Since then, as a measure of conservatism, we restricted the carrying value, in the both independent and consolidated financial statement, the same value. We actually took in that quarter an impairment hit as well. Mm-hmm. Since then, from October 20 to March 22, we consult because Nabha Power we have not executed a firmed up deal like the way we have done for IDPL, we were continuing to report the revenues and everything. Whatever reports, whatever profit that the company was accruing was getting reversed, which means we are not taking the profits. Since then, for the last one year or so, the company's performance has definitely shown an uptick in terms of very improved PLF of almost 91%. 85%, sorry. For availability factor was 91 for the year. Improved PLF and a lot of cases that was there in between the legal court, most of the cases went into Nabha's favor. Practically speaking, now the company has completely, in terms of operations and in terms of the overall balance sheet, has actually strengthened. If you take by way of the discounted valuations of the future cash flows, definitely the company's value has gone up. When you compare it with what you call comparative benchmarks vis-à-vis, listed companies in this field, that also has gone up. Of course, we take the benchmarks more as a reference point. Since because of the discounted, valuation on the bench, on the back of discounted cash approach has gone up, so to the extent of the profits that the company posted has been taken. I hope I have clarified your- Understood. That's very clear. Thank you so much, sir. Thank you. Yeah. I have a request, since we are now towards the end of this call, maybe, few of you restrict to one question each. One question, please, for each of the people who want to ask. Yeah, go ahead, Sai. The next question is from the line of Sumit Kishore from Axis Capital. Please go ahead. Good evening, Mr. Shankar Raman and PR. My question is again on margins. For a five-year period FY 2021, your core margins were in the range of 10%-10.5%. You have clarified, you know, in your first response to a question regarding the new normal that margins are entering into, and your guidance for this year is 9%. You also mentioned that 60% of the, you know, impacted projects have already been executed, another 40% in next two years. Are you going to move closer or if at all, to your 10%-10.5% trajectory once all these problems are sorted? What is the extent of the, you know, unrecognized claims, where you are reasonably confident, and, you know, which have not really reflected in your margins over last two years? Okay. Sumit, this is PR, I will take that, because I think this is the fifth time or the sixth time the same question is creeping up. Let me try to answer it. Yeah, we have given that today when we have printed 8.6 FY 2023, we are looking at definitely an improvement. We believe that the worst is behind us in terms of the projects that we secured before COVID. The projects that we secured during COVID went into execution at higher material costs. We got, because of COVID, there was a stoppage of work which enabled us to get time extension from the customers, and thereby executing the project. Time extension need not necessarily mean value extension in terms of additional claims. Time extension only protects us to say the customer has no right under terms of the contract to levy any sort of punitive damages. But definitely extended time stay in the project also has its cost implications. A combination of, I would say, time extension leading to cost and also higher material prices that we witnessed in the last year, and to some extent sweeping into the current six months for projects that were bagged prior to COVID and during COVID, is one of the reasons. It's a combined reason I would say that where we are seeing margins at 8.6%. As Mr. Shankar Raman talked about, that this particular project execution trajectory is going to see possibly the end of FY 2024, the mix of these projects hopefully coming to a close. As orders that we have secured during the last later part FY 2022 and in the current year, obviously factors into account, I would say the current material prices and to some extent, the margin trajectory will be definitely protected. All of this getting into execution mode for us to recognize margins is going to happen in the later part FY 2024. At this juncture, it would be not be possible to say in terms of how much of these claims, because as you know, as a EPC contractor, definitely we are putting up the claim. To what extent, once the project is handed over, to what extent it is getting cleared by the client is a question of negotiation and discussions and settlement at a point of time. With this, I would like to reemphasize that, at the overall projects and manufacturing level, what we have printed for 8.6% seems to have bottomed out. We should be seeing an improvement, and that is the reason we are giving a comfort that we do expect an improvement of almost 40-50 basis points over 8.6%. That would happen in the later part FY 2025, hopefully, we should be seeing a major part of the orders that we have secured recently getting into, I would say margin recognition threshold. Hopefully, I think, that should be coming back. In terms of what margins we will see, as you know, we typically guide the margins only for the year. For obvious reasons, it is impossible for us to give a guidance beyond a year considering the varied nature of the projects business. Thanks a lot, PR. Thank you. The next question is from the line of Pulkit Patni from Goldman Sachs. Please go ahead. Sir, thank you for taking my question. Two quick questions. One on the Hyderabad Metro. The ridership improvement has been very significant if you see year on year. Still profitability has improved a little bit on that too because of financing. Any ballpark number where we think we can get a bit of positive on Hyderabad Metro? Despite doing almost 400,000, we are seeing losses are pretty meaningful. That would be question number one. Yeah. In terms of Hyderabad Metro, if I have to really talk about, just to give a construct, today the ridership that we are witnessing in the current quarter on a normal weekday is ranging between 4.4-4.5. During the holidays and weekends, it ranges between 3.5-3.6 or so. For the benefit of all, if I take a construct that the average ridership for FY 2024, the current year, one were to assume 3.6 was the previous year. If you assume at around 400,000. At 3.61 average ridership, the total fare revenue has been in the range of INR 450 odd crores. If you take 400,000 ridership at an average realization of 35 per passenger or per trip, you can assume that the top line should be going around INR 500 odd crores at 400,000. In terms of the interest cost, the total external debt that L&T Metro Rail Corporation SPV has, external debt, is around INR 8,000 crores, comprising of around INR 8,000 crores of short-term NCDs and INR 5,000 crores of medium-term NCDs and INR 5,000 crore of short-term commercial paper. All of this what I spoke now, if you can, since the NCDs and the commercial papers are listed, the entire financials of the metro has actually been filed in the stock exchange. Actually what I gave you is the overall context of the ridership, the fare revenues, what we can assume as ridership for FY 2024, and what kind of EBITDA one can see. Pulkit, Shankar Raman here. You know, there has been a development in terms of fare fixation committee agreeing that the sponsors, namely, L&T, can subject to demand-supply conditions, revise the fares. At the moment, all the projections that we are talking about is based on the fares that we are currently collecting. If things settle down and this work from home, etc., further moves towards work from office, I think, and the general population gets more comfortable with the usage, we do expect that there could be an opportunity along the way to relook at the fares. That will also be another kicker, depending on how much we are able to do this. Got it. Sir, just one quick one on the power JVs. I mean, we've been talking about, you know, potential orders in this segment, and we know that it's been tough. What is the thought process about running these businesses? Could we look at, you know, doing something else on those factories over time? Just your thoughts on this thermal power JVs and their future. It's under discussions because we are also talking to partner, our partner, and we're trying to figure out a way as to what is to be done, because these are good capacities that have got created, and it'll not be appropriate just to scrap it. Of course, the plants can always be used because it's space which we use. To some extent, export of some of these equipment is also possible subject to the JV partner willing to route some of the businesses through us. Right from, you know, the investment being bought over by them to the plant being used for their requirements to we trying to do something else, all of that are getting discussed because I think, we do recognize this energy transition is a major implication in terms of whatever, we have created on ground capacity. Let me share the details only when we progress a little more clearly on one of these various options that we are trying to evaluate. Sure. That's useful, sir. Thank you. Thank you. The next question is from the line of Aditya Mongia from Kotak Securities. Please go ahead. Thank you, everyone for the opportunity. My question was more specific on the working capital situation and the way it is improving. Should we be inquiring from 15% working capital as a proportion of sales number? That the intent of the customer is to make us execute faster. I'm saying so because obviously at the backside there is there were changes that had happened on the procurement side of things that ensured at an incremental order, the payments will be very, very prompt. Has that started to kind of satisfy on a broad-based basis for you? Aditya, if I understood it right, I mean, your question is that, do you expect an improvement revenue if the working capital, the way we are managing it is a little more made more flexible? Is this what you refer to? No, I'm basically trying to assess that obviously I'm trying to assess the possibility of working capital further coming down. Ah. If there is a pure intent from customers to go in that direction. Definitely, I mean, if you see structurally from the Indian economy perspective, since a major part of the order book is oriented towards or exposed to government in some form or the other, and given the fact that the government finances have improved over the last two years or so we have definitely seen a more timely certification of the work done and the payments happening on time. I also like to mention here that the GCC part of the order book is also increasing. Typically in the GCC countries, the client paying on time and certifying the bills on time happens at a faster scale. To the extent of a larger share of the GCC order book coming in also has enabled us to overall improve the working capital at a segment and at a group level. I just want to pitch in one more question, sir, over here. Sir, on the GCC side of things, the comments being made are quite bullish for the near term, and we understand that, let's say, this, the entire territory and hydrocarbon space is becoming a larger proportion of our overall business. Does that kind of worry us at some point of time beyond the next 6 to 12 months that we are so exposed to hydrocarbon, especially that in the Middle East? In the Middle East, our opportunities today, the way we are looking at is a combination of hydrocarbons and infrastructure. When we talk about infrastructure, the opportunities largely center around renewables and power transmission distribution, and obviously opportunities in the non-ferrous sectors that come once in a while discreetly. We do see in the next year, that is FY 2024 and possibly maybe FY 2025 as well, the opportunities from the refinery or the hydrocarbon side continue to be holding good for us in terms of better order prospects and hopefully larger orders as well. Sir, with that, those are my questions. Many thanks for the response. Thank you, Aditya. Thank you. The next question is from the line of Deepak Krishnan from Macquarie Capital. Please go ahead. Thank you for the opportunity. My question is more about the ROE target. How do we reach the 18% from the 12.2% ROE in the next three years, given that, you know, core margins may still see some issues, say, FY 2024? Like, what end margin do we kind of assume when we have the 18% ROE target in mind? Deepak, I guess, I think this we have covered in numerous calls and conversations. The way to see it across is that the, if you see the slide that we have put it as part of our additional slides in the deck. The two major, I think margin erosions are in a question of the development projects, which is the concessions part of the business. Once, that is done, definitely we can see in terms of an improvement of 1.5%- 2%, which means reduced losses or profits from Hyderabad Metro through a combination of restructuring of that company's current position. The prospective of an investor coming in, maybe not now, but maybe definitely after two to three years, once the assistance that has been declared by the local government comes in and we are able to monetize the TOD rights that we are looking at maybe in the current year. Improved performance of Hyderabad Metro, divestment of IDPL hopefully should get completed in the next six months or so. Hopefully, I think with improved performance of Nabha, we should be looking forward to a buyer who can possibly match our price points. With this, the margins, the ROE stack itself will probably improve by 1.5%-2%. The second point is, I would say, the steady growth of our traditional portfolio of projects and manufacturing, which today in the current year is almost 19% odd. If we are able to manage what we are talking about, sort of a mid-teen growth in the overall growth portfolio of the entire group with a better margins, I guess that should add up to another 2% into the ROE. The last 2% would be a combination of, as Mr. Shankar Raman referred to, in terms of higher payouts to shareholders. It is a 12 + 2, + 2, + 2 kind of a strategy. Sure, sir. Maybe just one follow-up. Any update on the cash from the AP government for Hyderabad Metro project? Of course, in their local budget, they have allocated INR 1,000 crore, INR 1,500 crore for last year and in the current year, and as part of disbursement, which will flow into the L&T Metro Rail SPV. Last year, that is till March 2023, we got around INR 100 crore and we have got some token sum in the current year. Hopefully, I think this year we should see a sizable amount of money coming in. Those are my questions. All the best for the future. Thank you, Deepak. Thank you. Ladies and gentlemen, we'll take that as the last question. I now hand the conference over to Mr. P. Ramakrishnan for closing comments. Thank you, and over to you, sir. Thank you, ladies and gentlemen. I hope we have been able to explain the contours of our performance FY 2023. Of course, you would have heard the comments of Mr. Shankar Raman in terms of how we are looking FY 2024 and the near term across segments, across margins, across businesses. With those few words, thank you for the patient listening. In case any one of you have any follow-on questions on the numbers in terms of stack-up, please do not hesitate to call me or my colleague, Harish. We'll be definitely there to help you out. With those, with that, thanks for call. Thanks a lot for joining this long call. Thanks once more. Thank you. Thank you. Ladies and gentlemen, on behalf of Larsen & Toubro Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.