Ladies and gentlemen, good day and welcome to the Q1 and FY 2027 earnings conference call of RailTel Corporation of India Limited, hosted by PL Capital. 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 touch-tone phone. I now hand the conference over to Mr. Vishal Periwal from PL Capital. Thank you, and over to you, Mr. Periwal. Thanks, Danish, and warm welcome to everyone for joining in for the RailTel Corporation Q1 financial year 2027 result discussion. From the RailTel team side, we have Mr. Sanjai Kumar, CMD, sir. Mr. V. Rama Manohara Rao, Director of Finance. Mr. Manoj Tandon, Director of Projects, Operations, and Maintenance. Along with him is Mr. Yashpal Singh Tomar, Director of Network Planning and Marketing. As usual, we'll have a brief from Sanjai Sir on the gone-by result, and then we'll have a Q&A. Thank you, and over to you, sir. Thank you, Vishal. A very good morning to all. It gives me great pleasure to interact with you on the company's performance in the backdrop of Q1 financial results of FY 2027, which were declared by the company on 30th July 2026. The company had a strong start to the financial year 2026/2027, having achieved operating revenue of INR 893 crore in Q1 of FY 2027, as against INR 744 crore in Q1 of FY 2026, registering the year-on-year growth of 20%. The telecom segment contributed INR 361 crore and projects segment contributed INR 532 crore in company's operating turnover. The total revenue for Q1 FY 2026/2027 was INR 910 crore as compared to INR 758 crore in Q1 of FY 2026. The company registered 12% growth in its profit before tax and exceptional items, which is INR 96 crore for the quarter ending 30th June 2026 as compared to INR 86 crore during the same period of previous year. The profit before tax and profit after tax for Q1 FY 2026/2027 was INR 89 and INR 66 crore respectively, which is almost the same as in Q1 of previous year. Orders received during quarter ending 30th June 2026 was to the tune of INR 1,688 crore as against total orders received during quarter ending 30th June 2025 of INR 721 crore. The company has robust order book position of INR 11,747 crore as on date. I'm happy to inform you that the CAG has offered nil comments on the annual financial statements of FY 2025/2026. We remain committed to pursuing growth and creating value for our esteemed investors. We thank our investors for their trust in our company, which we are committed to uphold. Thank you. [Jai Hind]. Thank you. Ladies and gentlemen, we will now begin with a 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. First question comes from the line of Sanjesh with ICICI Securities. Please go ahead. Good morning, sir. Good morning, Sanjesh. Thank you, sir. I just wanted to get the breakup first on the three segments, which is NLD, ISP, and IP-1. This quarter, IP-1 is INR 27 crore. Okay. ISP is INR 112 crore. NLD is INR 134 crore. What was the contribution of railway in the total order book? You are talking of railway segment in the order book? Correct. That is around 23%, 23.5% exactly, if I say. Got it. I want to understand on the Kavach, where are we in terms of the execution for the two orders in and how about this year, how many tenders are we expecting from that segment? Yes, actually, Kavach orders are, I've been repeating this. Kavach orders are long gestation, generally will take 30 - 35 months. There's lot of outdoor work is involved. Outdoor work is in progress in two orders of East Central Railway and WCR, we have initiated our work because this was latest work, which was West Central Railway. Outdoor works in East Central Railway is in advance phase. The approval of RDSO, if we see about it, is underway and is likely to happen any time now, maybe next month. Drawing preparations have also started. Things are going on in the right context, I would say we are there. If you ask about Kavach tenders, we are not seeing many Kavach tenders in this current financial year because the existing Kavach tenders, which are already awarded, are under execution and it is in development, I would say, and many more improvements might come based on experience. Maybe that may be the reason, but we don't really know. Railways to decide when they come out with the new tender. I can't comment exactly on that aspect. The ones we are now doing some outdoor work and drawing and all this, when should we expect revenue recognition to happen for us? I think this year we should book revenue out of Kavach orders. Okay. We should start booking from this year itself. Yeah. Got it. Second, on the telecom side, both NLD and ISP. NLD on a year-over-year basis, we have declined. Last year, same quarter, we were INR 151 crore. This year, we are INR 134 crore in NLD. What's happening in NLD? Why the growth remains to be muted. In fact, this quarter, we have turned negative. Any particular reason you think? What I would say that normally Q1, we are expecting the renewals. Generally, our telecom customers are mostly government. This year, somehow the renewals, those services are continuing. Renewals are expected, and that is why we are seeing that we could not book the revenue. That is the major reason. Otherwise, as I shared with you, even my last call also, that we are doing good in NLD segment. We have got couple of new good customers like Air Force and, I would say, there's one private operator also. Starlink is now our customer. Growth is happening, and there's no worry for any of us regarding this thing. National Knowledge Network is one business segment where the NIC has decentralized the PO ordering. Individual institutes are now in the process of placing orders, but they have requested not to discontinue the services because the services are being used. Those are the major reasons I would say. Otherwise, there's nothing to worry in NLD segment. Once the renewals happen, we start booking the revenue. That's the way to- Yeah, of course. Yes. We don't book it on an accrual basis. Now that they are taking services, we book revenue. No. We book on accrual basis. POs have to be there. Okay. Once the POs are there. We may not. On the ISP segment, RailWire, where are we? Competition intensity high, people moving to FWA. Is that what is capturing the lower growth in ISP for us? ISP, if you see the number, we have grown. Today we are 6.23 lakhs. We have added almost 50,000 subscribers if we see from the previous year at the same time today. Okay. We have added customers, subscribers. Of course, as you said, that segment is very heated. The ARPU is continuously under pressure. We are trying to do some other things, like ITPO is very good subscriber for our business in ISP segment, where we are getting good business every year. Somehow we have to be in the market and then we have to fight with the In broadband segment, yes, there is lot of heat. Are we seeing demand for our cable, considering that there is so much of data center built up happening, which require a lot of terrestrial fiber, and we are very well placed there. Are we seeing the private player coming to us asking for the cable capacity? Are we seeing any sign there or it's largely as of now the government demand what we are looking at? No. Private players, fiber demand is there. They are asking for dark fibers. We, having independent and completely different right of way, our demand will always be there. We are working in that direction, how to invite investment in that kind of scenario because we don't want to put a lot of capital expenditure. Maybe we partner with someone who is sharing best revenue with us, then maybe then we can come out that kind of arrangement. As you have seen in data center also, we have good partnerships. That kind of model we are working out. Of course, demand is there, and they want us to be there. Then by when- Most other players are along the road. Correct. There's a lot of demand for fiber, right? Yes. We have a good ROW, we have presence deeper in the market. That gives an advantage. How do we? Certainly, it will come. It will take time. Of course, the demands are there. They also may not require so fast. Of course, demands have started coming, and we will certainly be there to meet those demands in the due course of time. Got it. From a project perspective, out of this INR 11,000 odd crore of order book we have, how much we intend to book in this year? I think we are expecting somewhere close to minimum, maybe INR 3,000 crore-INR 3,500 crore of project income should be booked in this quarter. We will try certainly for best, but that is where we have certainty. No, sorry, INR 3,000? INR 3,500 maybe. INR 3,500, you mean? Yes, INR 3,500. Yeah. INR 3,500 crore of revenue order in FY 2027. That is our anticipated projected revenue looking. Margin you are looking at to be at 4%-5% range. That's the range. I think margin, if you see, we have improved margins in this quarter. Sequentially. In project business. Yeah. We are continuously on the hunt for looking for better projects, better margin projects. Got it. Kavach will have better margin than this, or Kavach will be in the same range only? No, Kavach will be certainly better than. Better than this, right? Slightly better than. We maintain the outlook what we gave last quarter that we will grow at. Yes. 25% of revenue. Yeah. That guidance. You see, I have always been saying that in a company of small size like RailTel, quarterly results have to be seen with lot of study and many a times our investors may not be. Actually, you have very good understanding. We are very much satisfied with our performance and a small here or there, maybe like expected ECLs, suppose if I say. ECL can easily affect our quarterly results. If you see on overall annual results, we are sure that RailTel is going to do a good performance. No, that certainly does. Small numbers for a small company brings a lot of volatility. Yes. We do appreciate that. Most of the projects are government projects, payment delays, of course, happens. We are sure that those payments are going to come. We made our ECL policy to make it more transparent what way the things are happening. No, I certainly appreciate that, sir. One last question. Last quarter also, there was a sharp jump in the receivables from the telecom segment. Have you started getting that or that kind of an elevated number can remain even for this year? Last quarter, there was Yes. Actually some revisions are happening. Mostly those belong to railway. Some revisions and estimates are happening. Those will come. There is no issue. That was, of course, one-off event. You rightly observed it. Got it, sir. That's very helpful, Sanjai, sir, as usual. Thank you very much for answering all the questions patiently, best of luck for the coming quarters. Thank you. Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and one on their touch-tone telephone. Our next question comes from the line of Bala Murali Krishna with Oman Investment Advisors. Please go ahead. Hi, sir. Good morning. I just joined the call. Maybe I would have missed something about the Kavach part. We are partnered with Quadrant Future Tek for Kavach and the approval for them is still pending. Do you have any idea when we can have some update on that so that we can start recognizing revenue? Let me first clarify that due to Kavach approval, our projects are not getting delayed, point number one. Point number two, your concern is very right. The progress is very good and the final testings are underway and approvals are likely to be there any time. Maybe this month itself, we are expecting. Since these are the latest Kavach entrants, there are many modifications are being included, incorporated in this latest Kavach OEM based on the experience of the previous approved OEMs experiences in the field. That is why some time is of course being taken, but it will happen now. I think earlier we had an indication that even the other OEMs should approach RailTel for this IT integration, and we can get some revenue from that point of view also. Is it happening, sir? Is there any alternative that other OEMs are doing as of now, sir? See, I will not comment on this question right now. Of course, if required, sometime in the future, I will comment on. Right now, we are open. We are never closed. Whosoever gives us best commercials for bidding and participating in the tender, we are open. Okay, sir. Lastly, on the margin front, historically, we have 18%- 19% margins. Since last two years, we are at 15%. Being the project revenue is going ahead of the telecom, the margins are partially down, sir. Do you think this 15% margins range will continue, or is there any possibility in the coming maybe two, three years, four years down the line to get some hike in the margins? See, I always emphasize on this point. We are actually a group of two companies in one company. One is telecom, the other is my project business. We are maintaining our margins between 4%-5% in project. Telecom margins, of course, almost they are already in the range where they used to be. This is simple mathematics. If you club the two margins, you will see the mathematics. If project business, certainly which is growing because of digitalization requirement of our country. IT projects will certainly be there, and telecom requirements will be there. Because of continuous pressure on prices in telecom and telecom becoming something like, I would say, it's like now basic requirement, infrastructural requirement, which earlier not used to be there. When some requirement becomes infrastructure kind of requirement, its growth is always subdued by the pricing pressures. That's why telecom, we will see. One point I want to make it clear here, because we being telecom company, we are getting lot of project businesses. Now we are very much in the data center business, where we have focus in future years, which will certainly be growing. We have lot of expectation from data center business segment. We are on the right course. We are diversifying our businesses wherever we require, and I don't see that there is any challenge for RailTel as a business ongoing concern. I would say that investors need not worry. Okay, sir. Understood. Thanks for a lot of explanation. My question is that, I understood the telecom has a constant margins, project business we are having 5%-6% margin. In future, in the upcoming bid and upcoming, if you take any future projects, do you have any plan to uptake this project margin from 5%-6% to 6%-7% kind of thing? That is the question. Second is, as we were talking about this data centers business segment. What is the contribution as of, and how do you see this one contributing random thing in the coming four, five years? Those are my last two. Thank you, sir. Okay. That's what I tried to explain because See project margin, generally, if you see in the industry, many project organizations, their margins are 2%, 3% or 4%. Very few even operate in 4%-5%. We will strive to remain in this range. Of course, once its share in the overall revenue will increase, there will be pressure. If you see it on overall basis, the margins will be seen as declining. Which is actually not. It is because of some mathematics. Our project business segment is continuously in the same margin range. Our telecom margins are also in the same margin. You club together, it is seen as declining, which is not the truth, if you see the two segments separately. The next question is on your data center. Data center, we have a lot of expectation. Next, maybe 2027 and 2028 financial years, we should be touching around INR 500 crore of revenue from this business segment. We'll certainly be touching this year around INR 300 crore or maybe around that, somewhere more or less in that range. The way the global scenario in cybersecurity, sovereignty, and in Government of India is also thinking in that direction. We are expecting good business in data center segment. I think that is what I want to say in this. Okay, sir. Thanks a lot, sir. Thank you. Okay. Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and one. Our next question comes from the line of Vishal Periwal with PL Capital. Please go ahead. Yes, sir. Thanks for the opportunity. Sir, first is on the, in terms of our profit and loss account. There is an exceptional gain and loss that then we book it. This time though, the numbers are small, but this is pertaining what line item for us? See, these are based on some, I would say, historicity of the debtors. Based on when the aging of debtors increase, we are counting it in ECL. This is only provisional. None of the accounts are doubtful. We get all the payments. Some payment, if it's getting delayed after, say, one year and then two year periodicity, we are bringing it into the ECL account just for the sake of transparency. None of the accounts are doubtful. There's nothing to worry. These are all routines. Payments come and then as our revenues are increasing, naturally the ECL size and the debtor size is also increasing. We are focusing now very concentratedly on the debtors also, so that our ECL position is also improved. Okay. When you say ECL, it is non-cash only, that is fair to understand. Yes. It is non-cash. Okay. Got it, sir. The profit this year, you see, the profit is seen very flat. Yeah not consider ECL, which is actually non-cash, and it's null. We are even growing in profit also. Right. I think the same period last year, it was a gain, and this year it is that loss. That's why, I mean, the profit. No, nothing. It can get reversed. It can get reversed as soon as we receive those payments. Got it, sir. Second, in terms of our project side, what is the international order that is there in the project? Anything color can be provided, how has been the share in complementary opportunities that we are seeing in international sector? International orders, if I talk about, one business we are already executing in Ethiopia, which is around INR 18 crore. It is a small bucket right now. All other orders we have already booked, the revenue is already booked, like supply of some laptops, some cubes are also supplying. Like these cubes, these are the emergency medical kits being supplied by Ministry of External Affairs to various countries in friendly manner in the time, friendly gesture by Honorable Prime Minister, in the time of crisis in those countries. These are very small numbers. We are expecting to enter this market cautiously and slowly. We are working out something in Uzbekistan. We're trying, we're bidding in the tenders also. Uzbekistan, Sri Lanka, we participated, but somehow we didn't get it. Vietnam also, we are trying something. Opportunities we are continuously looking for. Ethiopia, we have now a project office and one project officer, one project director is posted there. The work is started in Ethiopia data center project. Okay. Got it. In terms of data centers, though, you did clarify, I mean, it's looking pretty healthy in terms of revenue booking also, INR 300 crore this year and then moving to INR 500 crore. Operationally, in terms of, I mean, like megawatt wise, what all we are commissioning, any operational aspects can be provided, sir? This year we are expecting by like May 2027, a 10 MW facility should be commissioned in Noida. That was the first target. Maybe even earlier, but maybe one month early than May. Next year we will have this 10 MW. Two edge data centers are already commissioned, Mumbai and Gurgaon. They are small capacity data centers. We are also expanding, but by very marginal capacity of 500 kW in Hyderabad. Noida, we will made operational very small capacity in the same place, because requirement is there. That is also 500 kW. This is all small additions, whatever we can do. We have tie-up with Anant Raj, with Adani, and few other facilities we have visited. Those data centers we are taking from them, and then we are getting empanelment in name of RailTel. Our data center work is the first priority today for us, and we are working very consciously, expeditiously to make our presence in this segment. Okay. Sir, from a business point of view, when we are putting our data centers, we are providing services. When we, say, do a tie-up with Anant Raj and Adani, how the business changes? Will that be we owning the asset? No. They are the passive infrastructures we have taken there. Data center services as such will be ours. They are the passive infrastructure we are taking from them. Okay. I think, yeah, that's all from my side, sir. I'll come back in the queue, sir. Thank you. Ladies and gentlemen, if you wish to ask a question, you may press star and one on your touch-tone telephone. A follow-up question come from the line of Sanjesh with ICICI Securities. Please go ahead. Just to clarify on this data center piece, when you say that you are taking passive infrastructure from some of the passive player, we are actually providing the cloud services, right? We are putting our own server and then we are selling the capacity on the server. We are not actually renting the data center, correct? No, yes, you are right. We are providing the managed and the cloud services. We are not actually providing the data center service there. We are providing managed services, yes. We are providing. That is the right term. That's the right way to put it. Data center, we have our own, and we are taking on lease also from others, like these two players, and then operation becomes ours. Correct. We do the managed services. We set up our own servers, and then we lease it. Yeah. Are we planning to go into the GPUs as well, or we are right now only on the normal- We are in the process. You will see something in news. Okay. We are working very hard in setups. For the AI services, right? Yeah. Yes. AI, also, we have started working. We are working on a project, which is likely to come from Railways on their AI requirement. We are also working in AI. You are rightly and very, this thing, pointed out this fact that AI also we have entered, and we are working on few use cases. Got it. We will be building SLMs or the SLMs will belong to the Railway? See, it is up to the customer. If they want to retain the, these will be certainly SLMs, not the LLMs. It depends. We are in discussion. It would be too premature to say anything, but even if it is there, so because railway use cases will not be usable anywhere else. Indian Railways is a different organization. It is very complex structure. Those use cases may not be used elsewhere. Got it. They will be completely air-gapped. For railway, got it. Yeah. Air-gapped system, not the public cloud, not those kind of things. That's clear. Very helpful, Sanjai. Thank you very much. Thank you. Thank you. Ladies and gentlemen, please note that this is the last intimation regarding the question. Kindly respond in the earliest to avoid any delay. If you wish to ask a question, you may press star and one. Thank you. As there are no further question from the participant, I would like to hand the conference over to the management for the closing remarks. Thank you. Over to you, team. Once again, thank you all investors who have participated in our investors' call. That is all I want to say. Thank you very much. Thank you so much, sir. Ladies and gentlemen, on behalf of PL Capital, thank you for joining us, and you may now disconnect your lines.