Good day, and welcome to Triveni Turbine Limited Q2 FY23 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. Rishab Barar of CDR India. Thank you, and over to you, Mr. Barar. Thank you. Good day, everyone, and a warm welcome to all of you participating in the Q2 and H1 FY23 earnings conference call of Triveni Turbine Limited. We have with us today on the call Mr. Nikhil Sawhney, Vice Chairman and Managing Director, Mr. Arun Mote, Executive Director, Mr. Sachin Parab, President Global Sales Aftermarket, and Ms. Surabhi Chandna, Investor Relations and Value Creation, along with other members of the senior management team. Before we begin, I would like to mention that some statements made in today's discussion may be forward-looking in nature, and a statement to this effect has been included in the invite which was mailed to everybody earlier. I would also like to emphasize that while this call is open to all invitees, it may not be broadcasted or reproduced in any form or manner. We will start this call with opening remarks from the management, following which we will have an interactive question-and-answer session. I now request Mr. Nikhil Sawhney to share some perspectives with you with regards to the operations and outlook for the business. Over to you, sir. Thank you very much, Rishab. A very good afternoon or good morning, everyone, and welcome to the Q2 H1 FY23 earnings call for Triveni Turbine Limited. It's my great pleasure to address you today, given the record performance that we've had on a number of parameters. Our top line, our EBITDA, our order booking, which all bodes very well for this current year as well as for the year to come. To get into some details, the performance of the company during the quarter under review has been very impressive, with the turnover and profitability growing by 41.9% and 53.8% respectively when comparing to the corresponding quarter of the last year, excluding exceptional income. The company is well on track for a strong multi-year growth trajectory aided by positive momentum in its addressable markets, ably supported by focused business strategy and extremely capable execution. The revenue, as I said, for the second quarter, stood at INR 2.93 billion, which is a growth of 41.9% and is the highest ever on a quarterly basis. The domestic sales showed an increase of 77% to INR 1.64 billion, while the export turnover increased by 93% to INR 1.29 billion, driven by the company's success in international markets in both the below 30 MW and the above 30 MW segment in the post-pandemic time. As a result, the mix of domestic and export sales changed from 56%... ...changed to 56% and 44% export in Q2 FY23 as compared to 68% domestic, 32% export in Q2 FY22. The product segment turnover was INR 2.23 billion during the quarter, an increase of 48%. The aftermarket turnover was INR 700 million during the quarter, a growth of 25% over the previous year. As you could see, aftermarket contributed 24% of total turnover in Q2 FY23 versus 27% in Q2 FY22. EBITDA for the quarter was at INR 664 million, up 39.2% year-on-year, with a margin of 22.7%, which is again another record for quarterly performance. PAT for the quarter was at INR 463 million, an increase of 53.8% year-on-year. As I said, the highest ever quarterly order book was also recorded in this quarter and which was at INR 3.61 billion, registering an increase of 18% over the last year. Our record order booking for the half year of INR 7.19 billion during H1 was an increase of 23.9%. Now our outstanding carry forward order book as of 30th September stands at INR 11.37 billion, an increase of 37.3%, which is again another record for the company. Investments including cash stand at INR 7.83 billion, an increase of 4.3% from 31st March 2022. To talk about more about order booking. On the product side, order booking during the quarter was at INR 2.72 billion, which was higher by 17% when compared with the corresponding period of the previous year. This is the sixth consecutive quarter of the company clocking over INR 2 billion in order booking for the product segment. The aftermarket segment also recorded an 18% increase in its order booking to INR 886 million in this current quarter. At the half year mark, order booking in H1, as I said, stands at a record INR 7.19 billion and growing a healthy 23.9% over last year. Noticeably, export contribution has increased to 39.5%, and order booking for the aftermarket segment has also shown a solid growth of 44.7% over the last year, reaching a record INR 1.9 billion in the first half. This all spells very favorably for the years to come. As I will keep trying to give you confidence in during the later part of my remarks, H2 seems to be even better. We are quite optimistic on all the performance metrics of sales, profitability, order booking, which all spells very well for the years to come. The total outstanding order book, as I've already said, stands at INR 11.37 billion as on the 30th of September, which is increase of 37% when compared to the previous year. The domestic outstanding order book stood at INR 6.46 billion. The export outstanding order book stands at INR 4.91 billion, which contributes 43% of the closing order book. In the product segment from an order booking perspective, we have received a high number of inquiries from the international market. Our growth in international market inquiries have grown by over 50% in this current quarter. At the same time, domestic inquiries, specifically led by a decline in metals and mining segment, the domestic market has declined by about 19% in the current quarter. On an overall basis, the entire inquiry book for Triveni Turbine has grown by over 26% in this current quarter. This is coming from a variety of different segments. Of course, Triveni Turbine is a preeminent supplier of thermal renewable solutions to both independent power producers as well as industry. We continue to maintain both our domestic as well as global leading market positions. In India, of course, we have a dominant market position. Increasingly in the international market, we are making greater headway. Market segments in which orders are arriving from include municipal solid waste incineration, in which we have received orders in the higher than 30-MW category in this current quarter. Which again strengthens our market position as a dominant supplier into this market segment of municipal solid waste incineration globally. This is for an order from West Asia. We have other successes in this sector as well. We've also received orders from Southeast Asia, Europe, and North America in this current quarter, which gives us confidence in terms of the recovery in these markets as they open up. The requirement stems, like I said, not only from thermal renewable solutions, but also from industrial CapEx, which is happening in terms of fixed capital formation in a variety of different industries. They seem to be led by process co-generation and heating requirements for a variety of industries. Also in terms of independent power production based on biomass and other renewable fuels. The company also is performing exceedingly well in its API market segment, and that is a market segment that is growing quite rapidly for us. Our developments in this line place us at the forefront of technology that is being provided to you know to our clients in this market segment. We provide both single stage and multi-stage designs, which are extremely energy efficient and have extremely good payback for our customers. On the aftermarket side, the company continues to grow across its three market segments of refurbishment, spares, and service. In the traditional business of energy enhancement and upgrades, have significantly contributed to both the international and domestic market orders. As I had alluded to in our last quarterly call, we have picked up a significant order in the Southern African Development Community area for servicing of large utility turbines. These are orders which contribute not only a lot to our top line, but also to the capability of the company to then further work with our clients to move up the value chain to get in an increasing number of spares and other higher value, higher margins, order business. This order in specific in the half year contributed to approximately INR 13 odd crores of cost, which was included in other expenses, as you will see. There will be other expenses such as this coming in the future quarters. While the margin level for these orders is lower than our typical aftermarket segment, we as a company, given the growth, operating leverage, mix in export versus domestic, the reduction in material costs, are confident of maintaining margins in the short, medium and long term for the company. Our focus is on growth. As I had alluded to in our previous conference call, about a growth of over 35% odd in this current year and next year, we are quite confident given the stage where our order book lies, to be able to achieve these numbers. If not try to exceed them. Given that fact, given the growth, given the high return metrics of the company, and given the fact that really the company does not have much use of its capital, its cash in bank, the board of directors has decided to do a buyback in this current quarter. Subject to the approval of shareholders, the board has approved a proposal to buyback from equity shareholders of the company up to 5.28571 million equity shares at a price of INR 350 per equity share for an aggregate amount not exceeding INR 190 crores through a tender offer on a proportionate basis in accordance with the provisions of SEBI (Buyback of Securities) Regulations, 2018 and the Companies Act, 2013. This is that we've received from many shareholders, and especially our large and largest mutual fund shareholders in India. We believe that this is a good way to return a chunk of money to all shareholders. The performance of the previous buyback that the company did in February 2019 had a subscription of over 184%, and small shareholders had a subscription of over 2,000% in that buyback. We're quite confident that this will be taken very favorably by shareholders and seen as a means by which the company looks to return capital to shareholders. The promoters will be participating in this buyback as well. Having said that, now our R&D continues to perform exceedingly well. We are focusing on further IP development on all existing product lines in terms of improving blades, blade paths, structural analysis, and other parts of the turbine, while at the same time our developments on future technologies also continues to do very well. We are in the process of piloting certain technologies, and we hope to report soon on some progress in these lines. With that, I'd be happy to open up for questions and answers. I have our colleagues on the line as well to help assist in any questions you may have. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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, to ask a question, you may enter star and one. We will wait for a moment while the question queue assembles. The first question is from the line of Kunal Sheth from B&K Securities. Please go ahead. Yeah. Hi. Good morning, sir. Congratulations on a very strong set of numbers. My first question is pertaining to your export market. While, you know, we have had exceptional performance in the export market, generally, you know, there has been concerns around, you know, what is happening around the world in terms of slowdown in economic growth. If you can share your views about what you're hearing from your end markets, especially in the export side. Okay. You know, you bring up a very important question because there are two factors to the market in which Triveni Turbine operates. As I've been trying to allude over the last several conference calls, Triveni Turbine provides heat and power solutions to industries as well as renewable energy-based power solutions to the IPP industry. Very frankly, when we see demand coming from places like Europe, it is coming from a perspective of energy transition, where you have requirements of energy efficiency stemming from industrial processes such as waste heat recovery or other biomass-based IPP plants. The largest segment of growth in markets such as Europe, which is currently under a huge degree of energy crisis as well as a conflict, stems from diversifying their energy requirements. Needs such as municipal solid waste incineration, as long as the waste exists, provide an extremely good business case for entrepreneurs or businesses to set up these capacities. As you know, there's ample funding from for these type of plants. Globally, otherwise, you have an enormous amount of growth happening in agro industries. Agro and process industries continue to provide growth for us in a variety of different markets, especially Southeast Asia, Central America. The API market, as you know, given the level at which oil and gas prices are at, continues to be quite robust, and we are aiming to increase our order book in this segment gradually over a period of time. It will reflect quite well on our overall order booking. From the perspective of our traditional markets below 30 MW, the international market seems to be doing quite well, and we are very optimistic in the coming quarters to exceed our current performance. The above 30 MW segment also we've had success, and we aim to continue pushing in this market segment, though, of course, it is more lumpy than the below 30 MW segment, as you could imagine, because of the number of turbine orders that actually do come about. The API market segment also continues to grow. A factor which will aid our international growth considerably is our focus on servicing internationally and our aftermarket proposition. I have our President Aftermarket, Sachin Parab, on the line. Sachin, could you give a little bit of indication as to how you see aftermarket growth and especially on the international side? Good morning, everyone. I'm glad to actually bring you up to speed on the deve- This is the operator. We have lost the connection for Mr. Parab. You may continue in the meanwhile. Yeah. Okay. Thank you. I'll get Sachin to answer the question when he gets back. If that answers your question, we can move on to the next question, unless you have We have- Thank you for such an elaborate, you know, outlook. My second question is pertaining to the margins. You made a comment about that you're quite confident about maintaining your margins for this year and current year. But would you believe, there are also drivers, you know, within the business that can help you know, expand margin going ahead, especially that we are also talking about increased focus on services? Yeah, yeah. I think you see the multiple areas where we can improve margins. As I said, operating leverage will allow us to improve margins. The product mix both on the export, domestic as well as aftermarket product will allow us to expand margins. Stability in commodity pricing and the fact that most of our rate contracts will now be renegotiated at lower rates would mean certain margin expansion. Having said that, we also see expenses along the way. We have already expanded our workforce by about 15% compared to last year's same period. We aim to increase that more significantly going forward to cater to our very large growth coming forward. We also aim to invest into R&D and to future-proof ourselves from a technology perspective. At the end of the day, the fact that we're seeing this amount of growth, and we are confident that we have pricing ability in the market. We have to be cognizant that we don't overcharge our customers, because we're playing a longer term game here. We're confident that we could improve our margins, but why constrain growth at this point in time? Let us run with growth. We are quite confident that we can maintain margins at where we're at. We just, I don't think that there's any reason for us to expand margins at this point in time, rather push for greater growth. Sure, sir. Thank you so much, and best of luck for the future quarters. Thank you. Thank you. Thank you. Ladies and gentlemen, I would request you to please limit your questions to two per participant. If you have any further questions, you may join the queue back. We have the next question from the line of Amit Anwani from Prabhudas Lilladher Private Limited. Please go ahead. Hi, sir. Am I audible? Yes. Yes, you are. Yeah. Thanks. Thanks for taking my question. My first question is with respect to exports, and you highlighted that we are seeing a strong pipeline in three or four geographies. If you could just elaborate more, where are we seeing the, you know, larger contribution expected to come? You mentioned about Southeast Asia, Europe, Africa. If you could just elaborate more, on which part and which category, between like, 0-30, 30-100 MW, where we are expecting to receive orders. Actually, the thing is, Triveni Turbine has inquiries from over 110 countries, and it has an installed base in over 75 countries. We're quite diverse as far as this goes. But when we talk about demand coming from areas like Southeast Asia and Europe and North America, these are very large markets. Of course, it will be spread between countries within them. Our focus as a company and our competitiveness and our market proposition is always strongest in the thermal renewable segment. Of course, a considerable amount of our inquiry book and our order book is in this market segment. As you'd imagine, this is a market segment that is also growing in the market because that is ultimately what finds adequate funding and meets resistance from climate change supporters. Very frankly, that contributes a lot. Industrial growth by itself would contribute maybe about 35%, 40% of our growth, excluding API markets. We are reasonably insulated, but we do play very strongly into the energy transition market. In the ranges, of course, our historical market of below 30 MW from a number of turbines is always going to contribute far more significantly than anything above 30 MW. We have made very good headway in this past year since our joint venture with General Electric ended in this market segment. We aim to continue getting orders both domestically and internationally from this market. As I told you, our recent order of municipal solid waste incineration was for an above 30 MW market, and so were our orders earlier in this year for waste heat recovery in the steel sector. We have confidence that it's broad-based. It's in terms of geographies. It's driven around thermal renewable solutions, either directly for grid dispatchable power or for internal heating requirement. Yeah, I think that's what I can give you right now. Thanks. With respect to, sir, inquiries, I think if I heard it right, you mentioned that inquiries have grown by almost 27% for this quarter, but I think there was a decline in inquiries in domestic market. Is it right? Yeah. Our inquiries. As per your slide, you want to. Yeah. Grew by 25%. Internationally, it grew by 58%. This is what gives us confidence in international order bookings in the coming quarters and year. Domestic market inquiries reduced by 19%, and this is pretty much all driven by the eastern belt of mining metals. Any outlook, are we expecting the same in coming quarter? I think so. I mean, the market outlook is still equally robust. The market itself for the half-year in the domestic market was somewhere in excess of 700+ MW. For the below 30-MW category, we didn't have much of any orders above 30 MW. We're confident that the year-on-year growth is there. You know, if we look at order conversions in certain industries, they seem to be very robust, especially in terms of markets such as paper recycling. New markets such as plastic recycling, et cetera, will be picking up as well. You have cement expansions and cement waste heat recovery, which will be coming up quite seriously in the coming quarters. We're very positive on the domestic market. As I told you in our previous conference call as well, the entire market has still a long way to go before it hits its peak for the domestic side. We think that while we have an upswing in fixed capital formation, it is nowhere near any peaks in any manner. We aim to, or we believe that we will continue to see growth in the domestic market in the coming years. For the next two, three years, we should continue to see it. Sure. One last question, sir, on the SADC. You mentioned that it contributed around INR 30 crore to the cost, other expenses, and margins typically here are lower. So, in this large service turbines, are we what could be the market for us? And are we expecting the margins also, you know, to improve here in coming quarters and anything in the pipeline here apart from SADC? Pipeline has orders from there as well, and they will be contributing in this financial year as well as next financial year. I think Sachin is back, so I'll let him speak a little bit more about this. In general, the SADC. What the reason I highlighted the cost for the half year, which formed a part of other expenses, is so that you get an understanding on the published results as to why other expenses went up so considerably. Therefore, we will continue to provide notes to our accounts to give that clarity. These orders, we aim to improve margins. But it's difficult for these particular orders to compare to general aftermarket margins. We think that providing the capability here, the market is really giving us credentials for the global market for us to provide this as a service provider everywhere. The market is extremely large. Sachin, if you're there, can you please provide you. Yeah. The specific question was about the SADC market. The services market in SADC region is huge. I don't have a figure to share with you, but we have a very, very small, rather insignificant market share. The reason why we have entered into this strategic services contract is so that we can build credibility, create a reference, and get into the reckoning in other markets as well. There is a lot of headroom in SADC itself for us to grow in the services region. Purely from a service standpoint of manpower supply, we are aiming to upgrade ourselves in the value chain and get into more of supplies of parts and upgrades, which will actually help us in improving the margins even better. This is just the beginning, the foundation being laid in SADC region for the services. We are confident that the reference we create here will help us get new business in other markets. The market remains extremely large, and you know, as I said, the market share is very small, so tremendous headroom for us to grow. Sachin, why don't you give an indication of the overall aftermarket growth also? This year we have seen good order booking across the spares, services, and refurbishment domains of the aftermarket business. The growth has been driven significantly by efficiency enhancement and upgrade projects. We see that across the markets, more so in the Indian context, where we find that a lot of customers are finding value in getting upgrades done on their turbines. We are seeing good traction across Asia and in Africa for all our revenue streams. The growth this year some of the numbers our Vice Chairman has already mentioned. We are quite hopeful and confident of achieving the same growth numbers in the next year as well. The momentum should continue for the services business. Thank you. Thank you. Thank you. One last, if I may. I'm sorry to interrupt. I would request you to please come back. Okay, sure. Yeah, thanks. Thank you. The next question is from the line of Himanshu Upadhyay from O3 Capital. Please go ahead. Yeah, hi. Good morning, and congrats on good set of numbers. I had a question on our order books is increasing and even for our competitors. Are the pricing also improving in the market? Because some of the peers are European based players, okay. So what is the pricing happening? Are we seeing any improvement in the pricing? You know, the thing is that we come off a extremely volatile raw material base. At which point in time you look at it and orders, but in general, you could say because the market is expanding, margins are expanding. You are right about that general principle. That is positive. That is a positive thing about it. It is an intensely competitive market also at the same time. Okay. We do see in general margins expanding because of the market expanding itself. Also, given the fact that different companies are at different cycles of having absorbed the raw material cost increases or the revision of costs downwards. Okay. One question I had was, see, in turbines, we see that refurbishment happens after a period of time, okay. At what point of time the company decides that it is time to buy a new turbine versus just getting it refurbished, okay? Can you just give some- It depends on requirement. Yeah. You see the product itself is a customized product and used by operators in their own manner. Really the wear and tear is dependent on a lot of inputs from the customer side itself. Primarily among those is the operator use. Especially if this turbine is used in an extraction mode or a back pressure mode where the steam or heat is provided to an industry, the requirements both from a quality of water perspective lead to degradation of different parts there. You have different wear and tear that happens between different customers, both based on industry as well as geography, different by different levels of automation, et cetera. The refurbishment cycle can be as quick as 1 year- 20 years. It is all unique and customized and depends on specific considerations. Our turbines itself are last to build or are designed to build in excess of 40 years, so they can last, they're rugged turbines, so they have no problem. But even in our own technology, we ourselves are developing new blades and new blade parts which improve our efficiency by 3%, 4%, 5%, 6% over the previous generation. You could even validate with our own installed base to improve and replace rotors and change blade parts to improve efficiency with a installed base of maybe 5 years ago even. Okay. One more thing. On that API turbine business, okay, what has been the progress and the path ahead on that product? If you can elaborate on that also? The path ahead is that this is a market segment that's newer to us, and we are building our inquiry book here and our order book. We have received good orders. We continue to believe that we'll receive good orders. The market is quite large, so we think that before we become a significant player there and come into the line of more intense competition, we have a way to go in terms of our order booking here. It will grow at a very fast pace year-over-year, but it won't contribute more than 10% to turnover. We'll let you know when it contributes over 10% of turnover. Right now it's not there. What are the new- Sir, I would request you to please come back in the queue. Okay, thank you. Thank you. The next question is from the line of Alisha Mahawla from Envision Capital. Please go ahead. Hi, sir. Good afternoon. Thank you for taking my question. Firstly I'd like an update on the CapEx that was announced last quarter. I think it was expected to come on stream this quarter. Yeah, I'll have our CEO and Executive Director, Arun, answer that. Yeah. Good afternoon to you. As regards to CapEx, the expansion at our new plant at Sompura is more or less complete and some balance portion would be completed in October month itself. There have been certain other acquisitions as far as land and equipment is concerned. Most of the CapEx is now over. There will be some balance in Q3 that would happen. I would like to tell you that all of it has been put to use. There's no fresh CapEx proposals. Whatever the CapEx we had is all that we're doing. 80% of it is in fixed infrastructure and about 20% is in software and other. Yeah. Other IT-based CapEx. Yeah. This is the CapEx that will come to increase the capacity to 200 turbines-250 turbines, correct? Yes. Yes, ma'am. Yeah. That's what I have said, that it has been already put to the use. Uh, how- You would recall last year we had done over 110 turbines. This year in the first half itself, we have reached a figure around that. The capacity is full. The building of numbers in the current financial year will be twice as compared to the last year. We have further space to expand it with the current infrastructure that we have. As our Vice Chairman has told you earlier, we are looking forward to around 300 turbines that can be built of various types and sizes. Okay. Sure. Will it be possible to quantify how much of our growth this quarter is attributable to the price hike that was taken in this quarter in the last three, four quarters? You know, every order is unique, so this. We don't have any list of standard price, so it's not possible to determine it that way. I think the previous caller had mentioned in terms of margins, and I think that's the only way that you can say that we've seen an expansion in margins. Okay. Sure. You did mention earlier in the call that there is a drop in domestic inquiry. Is this only attributable because of steep inflation in raw material costs or CapEx costs, or is it a general slowdown that now we're witnessing? Are we expecting this to come back in H2? Yeah, I think it'll come back in H2, but I think you have to look at it more, less on a quarterly basis and more on an annual basis. On an annual basis, you'll continue to see growth. Okay. Sure. Thank you. Thank you. The next question is from the line of Chirag Muchhala from Centrum Broking. Please go ahead. Yeah. Thanks for the opportunity. The question is on the SADC order of INR 1 billion that we had won. Anything of that order has been booked in Q2 as inflows? No inflows in that, on in Q2. Okay. Sir, on the similar lines, are we exploring servicing of utility turbines in India as well in the near future? If yes, then what kind of incremental capabilities we will need to build for it? Yeah, those are the capabilities that we already have. India is a very funny market which works on references and prequalification, et cetera. These are things that we will have in place. India is also a very competitive market, so we'll have to see how we enter into it, especially given the fact that we don't like assuming liabilities, especially in these matters. States like [Ceylon] are notorious for lack of transparency in the operation. We'll have to see how we operate in that market. Needless to say, we have the capabilities. We have the capacity as well. We have the knowledge. We have the references now. We just have to see how we approach the market and build customer confidence to be able to execute. Okay. At least from the private sector plans, any immediate plans to also, you know, I mean, start exploring that market or, I mean, probably not something over the next couple of years. Hello, am I audible? Yes, sir, you're audible. Management members, please confirm if you're able to hear us. Yes, we can hear you. To answer your specific question, this is Sachin here. In terms of the private players in the utility segment in India, as our Vice Chairman mentioned, it's a very fragmented and competitive marketplace here. We are going to be very selective in terms of the businesses that we will pursue, where the risk is limited and there's much more transparency in doing business. As far as independent power producers go with utility turbines, we are suppliers of parts, so that's an area which we have been actively exploring. Services will be more in the medium term, but for the short term, we are looking more in terms of suppliers of parts to run the utility turbines for independent power producers in the private sector. I hope that answers your question. Yeah, yeah, sure. Thanks. On the 30 MW-100 MW space, in the last call, it was mentioned that we were successful in a thermal renewable project also, which will be booked in Q2. Has that been booked or that is yet to be booked? No, it's been booked. It's been booked. Okay. Good order, great reference, good technology application. Oh, so this is a different- Very intense competition. This is a different order from the one that you are mentioning from West Asia of the municipal solid waste incineration, right? You know, I don't fully recall what I said last time, but this is what we have booked in this quarter. For the 30 MW-100 MW space, specifically in Q2, you know, how many units have been booked? Can that be, I mean, can that be given out? You know, Nikhil, we want to move away from. I wanted to take a note. I started off our conference call post our joint venture ending to give greater credibility around the orders here. We would like to stay away from giving individual orders until they're material, unless they're material. Regardless, to say that we're getting good market traction here, we get good market participation. Our inquiry levels in this space are going up, our customer references and our regard from customers is going up. Therefore we believe this will definitely add to, and is already adding to our order booking. We'd like to then just look at the turbine market in terms of applications rather than size over a period of time. Okay, sir. Okay. Thanks for your time, sir. Thank you. Thank you. The next question is from the line of Prolin Nandu from Goldfish Capital. Please go ahead. Yeah. Hi, team. Thank you for giving me this opportunity. Just want to understand your after-sales business a little bit better. You mentioned that these are customized turbines and life cycle can depend on the usage. As a thumb rule, let's say if a customer pays INR 100 for a turbine over the life cycle of the entire turbine, what could be the revenue that the customer will have to pay for the replenishment, spare and service element? About three times over a 20-year period. If INR 100 is paid for turbine, INR 300 for. On a non-inflationary basis. Non-inflationary basis. Okay. Yes. That's good enough. Three times, right? Yeah. Okay. Just an addition. I mean, you talked a lot about the international after-sales market. In the 0 MW-30 MW in terms of the turbine that we sell, we have a very high market share. Do we have a similar or a higher market share in after-sales in domestic market in 0 MW-30 MW? My question, what I wanted to understand was that how are we looking at the service or the after-sale element of the turbines of our competitors? Can you help share some strategies to- Yeah, yeah. cater to that market? Actually, it's a very good question you bring up. As you would see that growth markets such as India, Southeast Asia, where the installed base is lower, that means that both Triveni reference sites as well as competitor reference sites are lower. The focus is always obviously going to be in terms of more product sales. In India in specific, because really the expansion in Indian market in terms of captive power generation really only picked up post 2003 Electricity Act. Triveni's market share and installed base is a preeminent market base here. Of course, majority of our market base is catered to by ourselves only. Those customers who don't buy their aftermarket services from us are not buying it from a competitor. They're pretty much fabricating it in a very rudimentary manner. Those are not type of customers that we would like to sell to anyway because there's no price and margin there in any case. On the international side, as you rightly said, the installed base of our competitors is far larger, and our focus would be to incrementally take share from those OEMs who are largely no longer participating in this space, or are very expensive. This is dependent on giving credibility to our customers in terms of having on-the-ground presence and capabilities. To that extent, as we build out our international capabilities and on-the-ground presence, we would see greater degree of customer confidence. We have received numerous orders in this past quarter only from our competitors. From clients for competitor turbines, and these range from utility turbines of 660 MW to combined cycle application turbines of 60+ MW of our competitors. We think that it's very difficult. This is more a question of effort in market and making sure that our presence is there and then continuously selling. We know our capabilities are high and that our cost structure allows us to be extremely competitively priced for the customer. Again, as Sachin has said, that this is a key area of growth for us going forward. Sure. Just a follow-on to that would be, I mean, let's say in some of the international market where you need some people on the ground. Does it mean that initially we will have to probably invest and then it does not make sense to probably compare our after-sales margins that we have done historically because of this investment sales? Maybe in some of these key countries we will have to probably put that feet on street. Would it be slightly margin dilutive, at least in the short term? Is that a right way to look at it? No. Not at all, actually, because we're not a CapEx-heavy company anyway. Sure. Our capabilities are people. People. Very frankly, to expansion into markets is a HR constraint as well as a question. To that extent, like I did start off in my initial remarks, we have a very ambitious and aggressive hiring plan. We are looking for capable managers. We are looking for capable, competent managers at all different levels, business managers, technical and engineering managers, service support staff, supply chain people. We're looking to expand operations and of course keep in mind the fact that we will continuously look to contain employee costs as a percentage of turnover. Great. Thanks a lot for this. Thank you. The next question is from the line of Harshit Patel from Individual investor. Please go ahead. Hi, sir. This is Harshit from Equirus Securities. Good afternoon. Sir, my first question is on Europe, as you have highlighted rightly, that Europe is going for energy security, and that might open up a lot of prospects for us. Sir, could you give us some flavor on the European market as a whole as to how large is the market, what is the structure of the competition over there as to what would be the market share of top three, four large MNC players? Which are the tier two players, and where do we stand in this overall scheme of things? And lastly, on the similar lines, what would be the difference in pricing between these players as to how much premium would the tier one players would be charging, and where are we in this whole structure? That would be my first question. No, no. Thank you. You know, very detailed questions. Unfortunately, I don't think I would be able to give you answers on the pricing levels, but obviously you would understand that a price quoted to a customer and accepted by a customer means that other people were higher or lower to that. We at Triveni don't lose orders based on price. Our biggest issue in the international market is a question of visibility. As we can expand our visibility to the greatest extent, which is an indication through our inquiries, the chances of our success are higher. In general, Europe is going through its energy transition, and its requirements are specifically catered around thermal renewable solutions only or district heating as a matter. Typically, from a competitive viewpoint, Europe has had the largest number of incumbent OEMs, but they also have the largest number of OEMs that have gone out of business or have sold out also. The competitive nature of the market in Europe is the highest. We find that despite the fact that it is a competitive market, you have very healthy margins, I think for all manufacturers. The market, not only in Europe but globally, is dominated by Siemens. Siemens is by far the largest player in all market segments, in all markets, especially if you look at it from a global or regional perspective. They are the dominant player, and the rest would fall below, including us. We are there. Now, what you must keep in mind is the fact that the amount of inquiries that we see from Europe are pretty much the same number of inquiries that we see from Southeast Asia. Southeast Asia provides a different application to those requirements. There's more industrial CapEx and big capital formation happening in Southeast Asia as well as Africa than would be happening in places like Europe. Sure. Understood. Sir, my second question would be on the geographical split of our overall international revenues. If not the exact numbers, but if you can give a broad split as to what is the percentage of international revenues that we are getting from each of these geographies, Europe, Southeast Asia, West Asia, Latin America, and so on and so forth. That would be my last question. Thanks. You know, actually, firstly, I don't have this information on me, but I don't know how material it is to you, given the fact that, like I said, we sell in over 110 different countries. Very frankly, the economic climate between India and Bangladesh and Pakistan is not the same. Getting on a regional basis apart from Europe is not really constructive. Having said that, our order book, like I said, is based on two applications. One is industrial heat and power application, and the other is renewable energy-based power requirements. Now you could tell from areas that wherever the installed capacity or size of economy is larger, that will obviously be larger markets for us. Indonesia is always going to be a larger market than Singapore. You know, that's just obvious. Indonesia is also going to be a larger market for us than Thailand. Thailand is going to be a larger market for us than Vietnam. These are just consequences of markets. Very frankly, we participate in the growth of those markets and their energy transition as well. Right. Understood. Thank you. Thank you, sir, for taking my questions. Thank you. Participants, if you wish to ask any questions, please enter star and one. The next question is a follow-up from Prolin Nandu from Goldfish Capital. Please go ahead. Yes, sir. Thanks again for giving me this opportunity. You mentioned that you are also always upgrading, and there is this whole element of 3%-5%, 3%-6% improvement in yield, and that also is forming a decent part of your order book. For a customer, what could be the breakeven to probably upgrade, right? If there is an improvement of yield, a yield of let's say 5%. Is it like what could be the payback period for that kind of a replacement? It all depends on cost of capital, but as you'd imagine, and cost of capital and the price of your fuel. What we've seen, this has been a large driver of growth for us both on the product as well as aftermarket side, is the fact that raw material or fuel prices, be it biomass, coal, or even notional cost of heat, has gone up considerably in terms of calculation. The paybacks are very quick. I would say that for a 5% efficiency upgrade at 12% cost of capital should give you a payback somewhere in the region of about 3 years-3.5 years. Perfect. Understood. Correct. Correct. Cool. Thanks a lot. Thank you for this. Thank you. The next question is from the line of Khadija Mantri from Sharekhan. Please go ahead. Yeah. Good afternoon, sir. Am I audible? Yes, you are. Yes, you are. First question is that in the results we have had a special mention of some INR 11.4 crore of expenses towards execution and maintenance expenses in the SADC region. Was it a one-off or we are clarifying because we did not book any revenues for this order in Q2? No, no. There was revenue. The expenses of it were not directly incurred by us, and so therefore it's formed a part of other expenses. We had alluded to this in our previous conference call as well as this conference call, as the fact that there will be further revenue coming in this bucket, and to expect that in both, not only this current financial year but the coming financial year as well. Okay. Sir, when you say that better product mix will lead to improvement in margins, what would be the ideal product mix for Triveni Turbine, which can lead to like, you know, 100 basis points-200 basis points improvement in margins from current levels of 19%? I'm talking about operating margins. No. I mean, I think the fact is that it is a dynamic market. Of course, the fact is that we could expand our margins tomorrow to 20% or 25% if necessary. We just have to refuse certain orders. The thing is that the domestic market is always more competitive. Market share, we aim to maintain a good market share, a dominant market share in the Indian market, as per strategy. The fact that we consider it to be to grow the domestic market as well as our international market growing, we believe that in the medium term, we'll have a 50% product both international and domestic revenue share. That is one thing that will stabilize margins. The next part is on the aftermarket versus product mix. I mean, not product, I mean the revenue mix, where currently you have the 24% of turnover for this current quarter, the previous quarter, previous financial year. Oh, sorry, the Q2 of FY 2022 was at 27%. You can see why there's a margin difference because of the average margins that you would get in the aftermarket segment are considerably higher than what would be from the product. What we aim is, again, in the short term, is that we will incrementally grow our percentage aftermarket to sales as well. This will be difficult given the fact that we have an extremely high growth rate on the product side. This is something that we'll have to try, and that will be a challenge for us in the coming quarters, is to maintain the growth rate. Sachin has already spoken about the fact that it's already grown quite considerably from an order booking perspective and then therefore execution. We will aim that this will continue to grow even faster. We should have a higher aftermarket as a percentage of sales figure than the previous year. This all gives us confidence in the fact that ultimately we have a yielding revenue from our aftermarket and something that we think holds us in very good stead for years to come. Okay, sir. Thanks. Thank you. A reminder to the participants, if you wish to ask any questions, please enter star and one. As there are no further questions, I now hand the conference over to management for closing comments. Thank you very much, ladies and gentlemen. We're very pleased with where we've ended up with Q2 FY 2023 as well as H1 FY 2023. We have full confidence that H2 is going to be considerably better than H1. FY 2024 is going to be much better than FY 2023. We look forward to your participating in our growth journey. Both Arun and I thank you for being on this call. Thank you. On behalf of Triveni Turbine Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.