Ladies and gentlemen, good day and welcome to the Triveni Turbine Limited Q3 and 9 months FY23 earnings conference call. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal operator by pressing star and then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Rishabh Dhar of CDR India. Thank you and over to you, sir. Hey, everyone, a warm welcome to all of you participating in the Q3 and nine months FY 23 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. Lalit Agarwal, Chief Financial Officer, Mr. S.N. Prasad, President, Global Sales Products, Mr. Sachin Parab, President, Global Sales Aftermarket, 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 regard to the operations and outlook for the business. Over to you, sir. Thank you very much, Rishabh, and a very good morning to everyone. Welcome to the Q3 nine-month investor call for Triveni Turbine Limited. We're extremely pleased that the company has recorded record turnover, profitability, order booking, and even on the balance sheet multiple factors have been record for the company in its history. We're very excited to have this call with you because not only have we had very good results, but the visibility for results, both not only in Q4 but in the FY 2024 as well, seem to be very robust. With the identified growth avenues in the form of all the three product segments, which is the leadership in the below 30 megawatt category, the newer focus segments of above 30 megawatts space, as well as Drive Turbines, and that coupled with a very robust aftermarket strategy, encompassing spares, service and multi-brand refurbishment, gives us great confidence in achieving newer milestones in the quarters to come, both on operation and as well as on a financial basis. Revenue for the platform operations for Q3 FY 2023 stood at INR 3.26 billion, an increase of 44%. EBITDA for the quarter was at INR 750 million, over 40% with a margin of 73%. PAT for the quarter was at INR 526 million, an increase of 47.3% year-over-year. For the nine months, the results have also been very good with revenues from operations at INR 8.78 billion and EBITDA at INR 1.98 billion. All these numbers have crossed the yearly figures for FY22 already in the nine months of FY23. We've also ended. With this current quarter, we had an order booking of INR 4.2 billion and total order booking in the nine months of INR 11.39 billion, which is an increase of over 26% year-over-year. The outstanding carry-forward order book as on the 31st of December 2022 stands at INR 12.32 billion, an increase of 33.3% year-over-year, which gives you a visibility in terms of the revenue and turnover that the company will have to execute in the coming quarters. On the balance sheet side as well, we have a record situations with investments in excess of INR 8.3 billion, an increase of over 10% from March 31st. We also have further negative working capital in the business as well as extremely high free cash flows, which are higher from a quarterly perspective, a nine monthly perspective than the profit after tax on the respective period. On order booking and order book, the company has achieved, like I said, another quarterly high in total order booking, crossing INR 4 billion. The domestic order booking for the quarter was at INR 2.31 billion, an increase of 181% compared to last year. The export order booking during the quarter was at INR 1.9 billion, lower by 21% as compared to last year's order booking of INR 2.39 billion. It has to be kept in mind that quarter included some exceptional, very large and very prestigious orders from the international market. On the product side, order booking during the quarter breached the INR 3 billion mark and came in at INR 3.06 billion. It is higher by 13% when compared to the corresponding period of the previous year. The product segment turnover was INR 2 billion during the quarter, an increase of over 19% over the previous year. The aftermarket segment registered an order booking of INR 1.15 billion during the quarter, growing handsomely at over 130% when compared to the corresponding period of the previous year. Our aftermarket turnover was INR 1.26 billion during the quarter, a growth of 118% over the previous year. The aftermarket has contributed 39% of total turnover in Q3 FY23 versus 26% in Q3 FY22. The domestic outstanding order book stood at INR 6.92 billion, up 37%. The export outstanding order book stood at INR 5.4 billion as on the 31st of September 2022, up 29% and contributing to 44% of the closing order book. During the quarter under review, the revenue from operations grew by 45% as compared to the previous year, with domestic sales showing an increase of 40% to INR 1.85 billion, while the export turnover increased by 123% to INR 1.41 billion, driven by the company's success in the international markets, especially in the aftermarket segment. As a result, the mix of domestic and export sales has changed to 67% and 43% in Q3 FY23, as compared to 72% domestic and 28% export in Q3 FY22. In the product segment, inquiries increased by 31% year-on-year, we are witnessing higher inquiries, especially from the international markets such as Southeast Asia, Europe, West Asia, and North America. In its entirety, we have seen an increase in the international inquiry base by over 55% in this past quarter, we've seen a decline of 5% in the domestic inquiry book. Amongst industry segments, renewable energy Independent Power Producer segment led to a higher inquiry base, followed by process industries. In the domestic segment, we are seeing good prospects in distillery, pharmaceutical, chemical industries, amongst others, including waste heat recovery from the cement sector as well. The API segment in the domestic market as well as internationally is very robust, we have good visibility in terms of orders coming from this market segment. On the aftermarket side, the company is again witnessing very good growth in the subsegments of spares demand as well as for efficiency improvement and refurbishment with strong inquiry pipelines. Expansion of the portfolio to cater to utility turbines, geothermal, and other rotating equipment is yielding good results, and I'd be happy to discuss more of this as we take the conversation forward over the question and answers. An update on the buyback. The board of directors at their meeting held on 2nd November 2022 approved a proposal to buy back equity shares at the price of INR 350 per equity share for aggregate amount not exceeding INR 190 crore through a tender offer on a proportionate basis. Subsequently, the shareholders of the company approved the buyback through a postal ballot with e-voting on the 11th of December 2022. The tendering period of the buyback has commenced on January 17th, 2023, and will end on the 31st of January 2023. As far as outlook goes, despite the global recession concerns, Triveni Turbine is constructive on the business prospects in the coming years, and our inquiry book suggests the same. On the domestic market, we believe that industrial CapEx growth is expected to continue, and the small decline that we've seen in the inquiry base for this current quarter should be overturned in the coming quarters. We believe that segments such as waste heat recovery and waste to energy will receive further impetus from the government of India as well as state governments. This is for focus in India specifically, but it equally applies to the international markets as well, that there's adequate funding in the space for renewable energy power generation, especially as we see continents such as Europe clamoring for an increased energy transition. Triveni Turbine is also at the forefront of innovating and leading this energy transition by working with premier Indian educational institutions towards developing emerging technologies. We believe these will lead to a variety of different marine industrial applications for cooling, heating, as well as power requirements, including recovery of waste heat. The company's long-term vision is well supported by a growing workforce with a focus on upskilling and reskilling. Higher international presence could increase proximity to customers as well as continued investment in customer-centric innovations through research and development. Our total number of IP files stand in excess of 315. IPs registered are well over 220 now. The company has also added in excess of 94 people in the previous 12 months. We believe that this growth in personnel will continue into the coming year. We're optimistic on the future performance of the company. We believe that with a highly motivated workforce with sales and marketing abilities, engineering excellence, and a strong aftermarket capabilities, the company will continue to improve its market position and maintain its growth momentum in the years to come. Thank you very much. I'm happy to take questions now. Thank you. Thank you very much, sir. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may enter star and one on the 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. Anyone who has a question may enter star and one. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Himanshu Upadhyay from O3 Capital. Please go ahead. Yeah. Hi. Am I audible? Yes, you are. Sure. Congratulations on great. I had a few questions on the aftermarket business, okay? In this quarter, when we see the, means, doubling of aftermarket revenues, okay, was it a one-time order, or it... How should we understand this? Because historically we believe that this aftermarket business, which is around 22%-23%, will slowly, steadily reach 30%. But we see a very handsome jump. What are your thoughts on it? Actually we've been talking about this for the last couple of quarters in our investor calls. If you read the transcripts which are on our website, you'll see what we've been talking about specifically in terms of certain refurbishment service orders that we've taken in our aftermarket segment. As you rightly say, the percentage of aftermarket as a percentage of revenue has hovered in the region. It's gone up incrementally every year from 23 to 24 to 25 to 26. I think last year it was somewhere in the region of 27%, 28%. In this current quarter, it's coming to about 39%. This is driven by. These are not one-time orders. These we believe are large sustainable orders which will increase in value over a period of time. If you look at it in aggregate, the growth in the product side of the business is equally robust. While this quarter may have come in at 39% aftermarket as a percentage of revenue, I think for the yearly number, where you would take it somewhere in the region of around 30%+ would be a little bit more accurate. Having said that, the aftermarket segment is going to grow faster than the product segment. You would see a greater contribution from aftermarket as a percentage of revenue in the years to come. This is supported by the robust margin structure that we have in both product as well as aftermarket side. Let me ask Sachin Parab, who heads this business on the aftermarket side, to give you a little bit more visibility specifically on the refurbishment side of the business. Sachin? Yeah. Good morning, everyone. Yes, we've had a good quarter. In terms of the sales for the quarter, the percentage of the total seems unusually high. As our VC has mentioned, in the range of 30% of the gross sales of the company is what aftermarket sales will be typically. The business is consistent. The orders are consistent. The percentage this quarter, the third quarter, is slightly on the higher side. This is not really the percentage which we are looking at in the long term. Gradually, the percentage will go up, but it will hover around 30% or slightly after that. One more thing. You said that aftermarket will grow at a faster pace than product. Generally in capital goods, what we see is product grows better in up cycle and refurbishment and all those things happen more in the down cycles. Yeah. Aftermarket is lagging. Can you elaborate what is the reason for that? Yeah. Thank you. Yes, yes. As we tried to explain over the past couple of quarters, we have three distinct product segments which are growing in different ways. The first is our historical market of below 30 megawatts segment, which will grow given our market share based on the market size movements. We see the market size expanding year-over-year, which is evidenced by our inquiry book. That's. I agree with you, it's not gonna grow at very high numbers. The second market is the market in which we don't have a very high presence, but we have ambitions to increase our market share, which is above 30 megawatts base, where we will see good growth in as far as turbine is concerned and equally with Drive Turbines. All of this combined, as you can see from our order book, the product order book grew over 20% year-over-year. While the aftermarket order book grew by over 130%. The aftermarket is comprised of three distinct segments, which is spares for your own existing turbine base, services for your own existing turbine base, and then refurbishment, which is what we call both parts as well as service for third-party turbines. The first two will grow based on the growth of your own existing installed base. They will grow at the same rate of growth of your product growth. The refurbishment, given the fact that we have a strategy to have a more localized presence in international markets and have their own independent growth strategies to cater to third-party turbines before the population of turbines pick up in any specific geography, has gone very well, good, has borne out very well for us. We see that market segment, which provides not only parts for service to third-party turbine users, and this stretches across the spectrum of turbine users, be it from utility turbines to applications such as geothermal, has borne out very well for us. It's all based on localized presence. That is a strategy which we have elaborated on in the past, where we aim to increase our international presence going forward and therefore capture markets like this, which we will do opportunistically. One last question, then I'll join back into the queue. See, we acquired one company for aftermarket business. Which was basically a team of people who were present in aftermarkets. We said that if that strategy goes well, we'll look at more this type of acquisitions. Okay. What have been our learnings from this? What is our thought process currently, on growing the business or through inorganic... Yeah, I don't. Well, inorganic is a very strong word because we spent about INR 68 crores to acquire the stake that we did. It's not entirely capital. It's not. It's basically a quick acquisition of talent, which is what we did through that route. Our strategy. Our learnings from it are many. It's also very difficult to elaborate on this call. Suffice to say that we're very optimistic on the fact that we need to have a localized presence. The route to that localized presence being organic or inorganic, I think it is more in our strategy to attempt to do things organically. If small, again, I must repeat, small inorganic opportunities exist, we will definitely evaluate them. Sachin, would you like to elaborate on certain geographies that you're considering? Sorry, Sachin's line has just got disconnected. We will try to reconnect. Okay, no problem. I think that Triveni Turbine is looking at multiple different geographies, be it Southeast Asia, Europe, as well as North America and South America, to move on this strategy. We'll come out with the correct disclosures once the board has approved, has allowed us to disclose that. Having said that, we are actively contemplating our growth strategy internationally on the same lines or similar lines, of having an increased international presence in within the quarters to come. Thank you. I'll join the follow-up on this, Harish. Thank you. Thank you. Before we take the next question, we'd like to request participants to please limit their questions to three per party. Time permitting, you may come back in the queue for a follow-up question. We'll take our next question from the line of Kunal from B&K Securities. Please go ahead. Yeah, hi. Thank you for the opportunity, and congratulations on the great set of numbers. My first question is pertaining to the domestic market. While you would value the fact that there is some slowdown on the inquiry pipeline in the domestic market, any sense that you're getting in terms of why this is happening, in terms of is it more transitionary? What is basically causing this slowdown? Any sense that you're getting when you talk to your clients? actually it's still quite robust. I think this is more of a quarterly phenomena where you've seen. We know that. We register an inquiry when it comes as a formal request. The conversation that you're having in the market seems to be very robust. That. But for us, inquiry is a critical matter where very frankly a request for proposal has been raised, so that level of seriousness is much higher as well as the fact that people are looking for raising funding. So the bankability of the project, et cetera, requires a lot of these RFPs to be in place. The conversation that we're having with our customers or potential customers is as robust, if not more. We see a variety of different sectors adding to not only the inquiry book, but also have contributed to the order book from the domestic market perspective. You have segments which have been very strong for us, such as municipal solid waste incineration in the global market, really haven't contributed so much on the Indian side. We saw that contribute quite well in this current last quarter. We saw cement waste heat recovery continuing its momentum. We saw a certain process for generation from chemicals and other side also being quite robust. You have a lot of government expenditure coming up from fertilizer, petroleum, petrochemicals, et cetera, in certain... both the coming quarters as coming quarter as well as the coming year. We're quite optimistic of government CapEx also, which will be leading to higher fixed capital formation in the PSUs. We think it's transitory in nature, and we'll see, I think next year a much higher number than we did in this current year. Sure. Thank you. My second question is pertaining to exports, especially on the Europe side. You know, with energy costs increasing significantly in Europe, have we seen any change in, you know, discussions with customer in terms of their thought process? Basically, you know, cooling of energy costs in Europe, how does it impact our business? No, actually it's the opposite. The fact is that given the uncertainty in energy costs that they're facing, they're trying to speed up their energy transition. What that means is to become energy independent as well as become more decentralized and localized in terms of energy generation, especially towards a decarbonized form of generation. That fits directly into our product basket. As you know, the fact is that we provide from the renewable energy power generation space, we provide solutions in only two industries, which is biomass-based IPPs and municipal solid waste incineration. Both of those are dependent on the waste that's available. When the waste is available, it does get used. It's a question of ensuring that we are present in front of those customers to be able to win those orders. Okay, great. Thank you so much. The order does constitute about 20% of our inquiry book. It's very pertinent to our execution strategy. Got it. Sure. Thank you so much, and best of luck for the future. Thank you. Thank you. Our next question is from the line of Harshit Patel from Equirus Securities. Please go ahead. Hi, sir. thank you very much for the opportunity. Sir, my first question is, for our greater than 30 megawatt segment, could you highlight what has been our order intake in the first nine months of 2023? I remember we had received an order in the municipal waste incineration category in West Asia in the last quarter. Have there been any follow-up orders from that point onward? No, you're right. This is a segment that we're very actively pushing. If we look at it, this current quarter didn't see any order booking, but we're very optimistic in the coming quarters we'll get good traction in this space. The follow-on orders, et cetera, they don't exist, and they weren't any other any follow-up orders. Both from the domestic market, which really hasn't had many orders in the above 30 megawatt category as well as international, the market is something that we see will expand a little bit in the coming year, we'll be participating more aggressively in that space. In general, the fact is that technologically we are quite confident on our product range all the way up to the maximum 100 odd megawatts. We're going to stop differentiating between below 30 megawatts and above 30 megawatts from next year onwards and just talk about the industrial heat and power market as well as the renewable energy market. The reason to provide distinction between the below 30 and above 30 was to give confidence to analysts and investors about the growth of the business. The company seems to be growing exceedingly well in all its different growth avenues. As we've seen the record profitability and turnover in Q3, we hope to better that in Q4 and in the quarters to come in FY 2024. We're looking at a very robust growth of the business and, it will be split amongst all its different component categories. Right. Understood, sir. My second question is on the SADC region where we have done a small acquisition. Earlier you had highlighted that the total order value with the current customer could be as high as INR 1 billion over the years. We had also booked a small order worth INR 190 million in the first quarter. However, in the second quarter, you had mentioned that there was some incremental order from that customer. What was the situation in the third quarter? What is the cumulative order intake that we have booked from that particular utility level customer? I think somewhere in the region in this current nine months is somewhere in the region of about INR 60 odd crores. Am I wrong? Is Sachin are you online? Yes. Yes, similar numbers as you indicated, sir. Yeah, you know, I would encourage you to not look at individual orders because that's not really reflective. We don't have a concentration of customers in both the aftermarket and product categories. Our attempt has always been to diversify both geographically between customers and between market segments and industries. Very frankly, getting repeat orders is what's important to us because that is a sign and of confidence in our execution and the quality of our execution. Really, getting repeat orders for the sake of building our order book is really not how we benchmark it. We would use our success in the SADC region with other customers in the region, with other countries and with other aspects. We're optimistic and that, and that joint venture and our presence there has aided in providing that visibility. Sure. Just a bookkeeping question on the same line. You have started highlighting the kind of subcontracting costs that you incur as part of the other expenses. Does the subcontracting cost only on account of the SADC region or that is generally spread across the globe in your aftermarket? I think it is difficult to answer that, but it is the reason that we needed to highlight it is, as it was highlighted in the note to accounts. As you can see, that was for the SADC region only as what is expressed in that note, because it was material enough for us to disclose. In either case, the fact is that, you know, this is a competitive space in a competitive world. To provide excessive information, even on calls like this, leads to a degree of disclosure which I... my colleagues on the marketing side would not appreciate. Understood, sir. Just a last small question from my side. You have highlighted that you have added 90 odd employees in the past one year. That's a pretty significant ramp-up. Do we see a further ramp-up from here or the employee strength will kind of stabilize at the current levels, in your opinion? No, no. We would see a similar number of people joining within the next 12 months as well. Arun, can you provide some visibility on the employee recruitment strategy and how we're approaching it? Yes. As you know, the volume of the sales has increased and we need people for manufacturing and in other activities of the company also. These 90 people have been added across the board from senior level to the trainee level. We expect a similar number to be added in the current year. This will also ensure that our employee expenditure as% of sales is not likely to be more. In fact, it will be well within control and there will be a productivity increase also. There is no reason to worry about the extra manpower that we will be adding. There is an attrition in the last 1 year which was more, and we expect the attrition to continue. That's the way the industry is poised for today. To add on to that, the fact is that we've. In terms of specific competencies that we try to add, it's been more on internationalization front, more on execution capabilities as well as on technology. Of course, like, you know, everything has to go along. We believe that employee cost as a% of turnover will come down in the coming years. Despite the fact that we need to add more capabilities and more technical capabilities, while the employee cost for turnover is going to come down, the revenue per employee is gonna go up, and that's a, that's a sign of productivity. We're very hopeful that what is basically our frontline in terms of people will be adding productively to our order booking as well as execution. Understood, sir. Thank you very much for answering my questions. Thank you. Thank you. Next question is from the line of Amit Anwani from Prabhudas Lilladher. Please go ahead. Hi, sir. Thanks. Good question. My first question is about aftermarkets. As we see, obviously this quarter it has been contributing very strongly. What I can see, previous quarters it has been contributing to the average of about INR 70-80 crore, and you highlighted that at least INR 40-50 crore extra has been booked for this quarter. I think, wanted to ask, is this because of SADC contribution largely? No, that is a one-off. The segment itself is doing in a very robust manner. That has an aftermarket, specifically refurbishment. Now, refurbishment for us comprises of a variety of different services. You have what I would call slightly lower value-added services such as overhaul and higher value-added services such as efficiency upgradation. It depends on customer to customer geography as to how we're able to instill confidence in a customer to be able to avail for them to buy some of these services. Obviously, the greatest confidence that a customer gets is by having a local presence. Therefore, given the fact that we have partly through this acquisition, partly through having employees based in the Southern African region, we do have a critical mass to be able to get orders. That as a strategy has worked well for us, and de-risk in a market which is reasonably low in terms of profit liability. As we look to expand the model out, you'll see this coming from everywhere. On specifically on the aftermarket side, yes, in the current quarter, you did have the SADC contribute well. Very frankly, if you look at it from a perspective of profitability as well as focus, it is very widespread amongst all the different customers and geographies that we cater to. Right. I also wanted to understand within exports, how much would be products and aftermarkets? Any key geographies which is significantly contributing to export. Obviously, you have highlighted 45 geographies. If any percentage range you can... No. You know, we don't give percentage ranges because that ends up giving you the turbine value only. Having said that, we've seen good orders from South America and Africa in this quarter, then coupled with the regular and routine orders that we have picked up from North America and Southeast Asia and Europe. The ones that we would highlight in the larger range, which are closer to 130 megawatts, were from these regions. In a very competitive environment, we've performed very well. I. Essentially what we've seen over the course of the past year is that the market has expanded. With that expansion, as well as commodity prices coming down, the booking margins have actually expanded, and so we're looking quite optimistically in the years to come. It doesn't mean that it'll all translate down to our bottom line. We have more expenses that we'll incur in terms of our internationalization. As a company overall, we're very comfortable with our margin profile as well as what we forecast even for the year to come. Right. My last question is if you can highlight, if possible for you, the megawatt-wise addressable market for you between 0-30 and 30+. Any sense on market share, retaining, losing, retaining, any absolute changes. If you can highlight on the capacity expansion which you mentioned last year. Thank you. Yeah. On the megawatt-wise, market share, I think you may take it offline and discuss with Surabhi. We've maintained our domestic market share. Our international market share has gone up as you can see from our order booking. This is in variety of different segments that you have to look at. In general, the performance is based on the fact that in certain market segments we haven't had a great degree of market share to begin with, such as specifically in the higher range of megawatts as well as in the API turbines. As we capture more orders there, of course our market share will increase. How to break it down directly in terms of market share is a little difficult. We internally benchmark it based on the inquiries that we have. The success rate that we have on our inquiries, especially in the international market is what is the way that we would judge it. Of course, that is not the entire market. As you would understand, we at times we don't have visibility into a lot of these product segments. The last question was on CapEx. CapEx wise, everything is on track. We will be as we come into the new financial year of FY 2024, we will spend a little bit more money on balancing, because as you would imagine, over the course of the last year, we a year before last, we may have manufactured in excess of 120 odd turbines. This year we will, we may take that up to 160 odd turbines, and next year it will be in excess of 200+, or well above 200. Our booking, of course, will be in the higher range of the, of nearly like 250-280 turbines. We do have some execution-based CapEx that needs to be done. A majority of our CapEx is going to go into R&D, into new software and skills and capabilities, new programs that we will be launching along with educational institutions, both in India as well as internationally, as well as a certainly of internationalization of more service centers, et cetera. That is where our CapEx is going to be focused on. A little bit of balancing will have to happen. In that sense, our entire CapEx is quite reasonable. I think when we had expanded our bay, it cost us about INR 35 odd crores. There may be some resultant CapEx and follow on CapEx of INR 2, INR 3, INR 4 crores and another INR 5, INR 7 crores on the fixed assets that may have to be created. We will provide more visibility into this as we get into the new year. Thank you. Thank you. Our next question is from the line of Chirag Muchhala from Centrum Broking. Please go ahead. Yes, thanks for the opportunity and congrats for very good set of numbers. Sir, we have seen very strong ramp up in our order inflow for FY23, you know, where we will more or less end the year in excess of INR 1,500 crore order inflow. You know, over the medium term of like the next 2-3 years based on the inquiry pipeline and key trends across India's industries and the regions that you operate in, on this base also, do you feel that a reasonably high growth rate of 15%-20% is possible, sir, over the medium term of 2-3 years? Most definitely. The fact is that you see, one is that, we obviously try to aim to beat your order booking number for this current financial year. That's why we're providing so much visibility on the inquiry book and the growth in order booking also. That gives you an idea as to how we see the years to come. As you understand, our product execution profile is usually in the range of about nine months for eight to nine months for smaller turbines and about 12 months for larger turbines. And services is pretty much always within three to six months. You have a lot of book and bill within a current financial year. That provides us visibility for the for sustaining growth. You know, the main question is how are we going to be able to sustain the growth? While FY 2024 is pretty much locked in the bag with high growth, this is despite the fact that we will have book and bill in the 1st quarter of FY 2024 as well. Going forward to FY 2025, 2026, we do have good visibility of sustaining growth in those years. Good to hear that, sir. On the Sompura plant, expansion. You know, that was supposed to be over in Q3. Any update on that and what should be our total turbine capacity now? Arun, are you online? Yes. Yes. The Sompura expansion is more or less complete. We have already started using that bay. Partially the capacity is being used. In another one month it will be complete in all respects, so the full capacity will be added. We are looking at a capacity between 250-300 turbines, depending on the size, and also there will be a flexibility. We are quite comfortable in meeting the higher demand that may come in the years to come. Okay. sir, this 250-300 is total of both the plants or only Sompura? Of both the plants. Both the plants put together. Okay, sir. Sir, lastly, on the API turbines. Sir, you mentioned in your opening remarks that the government focus on fertilizers and chemical is also healthy. You know, sir, in API turbines, I think you're also qualification in the domestic market, Indian market. Any addressable market opportunity for us that you can highlight specifically for API turbine in domestic market? Yeah. You know, we refrain from talking about individual customers, and I'll ask Prasad to comment a little bit about this. The API market segment has two requirements. One is for power generation and the other is for drive. As long as you keep that in mind, power generation is much like industrial power generation, where the turbine would be coupled with the generator. The drive turbines are those that would drive the equipment. For the domestic market, Prasad, can you provide a little bit of visibility as to which segments are giving you inquiries or potential order booking in the quarters to come? As you rightly mentioned, the API market is divided into power generation as well as the Drive Turbines. We have been approved by major OEs and the EPCs and TCP consultants for both. Pipeline wise, yes, sir, there is a strong growth in API inquiry pipeline which may be addressed across the board for the API supply device line. Going forward, yes, we can see some orders which are in advanced stage of discussion. Even power generation, to sign orders with API. We are quite optimistic and bullish on this segment going forward. Sir, any approximate, you know, market share even in megawatt terms? Because API is a more stable market, because this market is again one is those markets. Is in case market as a place for total lifetime. Actually, market size estimations wise, probably those things may be offline, we can share it with you. Otherwise, today our market share is quite miniscule in that, and there's a huge growth opportunity. Sir, last question with regards to that is that, currently these are serviced by like Siemens or any other MNCs within India. Many of it or these are largely imported? This is a mix of even imported as well as the India-based. Again, based on the type of inquiry requirement or specification. Some of the specifications India-based competition there. Some specification they also include. This is a multinational competition. This is a mix. Okay. Thank you for answering my question. Thank you. Our next question is from the line of Ravi Swaminathan from Spark Capital. Please go ahead. Thanks for taking my question, and congrats on a good set of numbers. Just to continue with the earlier participant's question. Can you explain globally what is the size of the market? What is our opportunity there so we can do a thorough thought process? Yeah. So thank you for your wishes first, Ravi. you know, from the API market segment, there is no real data. The data is in an inquiry book. Again, like I'm saying. When we look at market share, we look at versus the inquiries that we have. There's no third-party data out there which says how many turbines are being ordered or we know in post fact there's some data that's available in terms of how much is placed. At the point of time of bidding, it's really difficult. When we look at the API, our market share, the API segment, like Prasad said, is quite miniscule. When we had said last year we would get 30-odd orders and this year we'd get 70 orders odd, and growth for us may be doubling in this market segment, it's still miniscule in terms of market, it's single-digit market share globally. Very frankly, there's a long way for us to go in terms of being a significant player here. Got it, sir. Usually the turbine size is on the lower single digit, like three megawatts, five megawatts, one megawatt? It will range from 1.5 megawatts to 5 megawatts, but it will be in the lower range of 1.5-3 megawatts somewhere there. They're driving equipment, so they drive equipment such as fans, pumps, blowers, compressors, et cetera. They'll be both API 611 and 612 compliant. Sure, sir. Got it, sir. Thank you. The next question is from the line of Nikhil Agrawal from VT Capital. Please go ahead. Good morning, sir, and thank you for the opportunity, and congrats on a great set of numbers. A couple of questions. Like, coming to your other expenses, do you expect this item one way going forward, or was it just a one-time for the nine months arrangement? No. See, the other expenses and the disclosure that we made was on the subcontracting charge and other expense. The reason that we did it is because it wasn't really necessary for us to provide the disclosure, but we thought it would be helpful for investors to see, because from a quarterly perspective, there's a big jump over the previous year. Mm-hmm. It's for that reason that we highlighted. It's just to provide visibility and a little bit of clarity. I think we're focusing a little bit too much on it because the fact is it's more routine. As we look at it going forward, these are charges which have negligible or very low liability for the company in terms of continuing costs. They will be incurred as and when revenue falls. To that extent, we will have the profitability in those quarters as well. What's important for us is that as overall as a company, we aim to expand our, or maintain our margins. We've always said that we would have PBT margins in excess of 20% as a company. We think that in the environment going forward, regardless of what type of refurbishment contracts we take, the team has performed very well in giving visibility that should at least be maintained. We have commodity prices coming down. We have an increased internationalization of our product mix in terms of sales, as well as an expanded market, and so therefore a more easing of margins in order booking. Overall, I think that we're in a very comfortable position as a company. We've tried to provide visibility in numeric terms, and I think we're gonna beat all of those numbers that we had given you. Okay. Great. I mean, you, we should expect other expenses to be within this range. On the gross profit, on the gross margin side, we expect margins to inch up going forward. Ultimately the PBT margins will be met. We have good confidence that there are a lot of reasons that it may inch up, but very frankly, we also want to be spending money on adding capabilities where we see future growth so that we can sustain our growth. Triveni Turbine came off the last seven, eight years with very, very low growth. While we are facing this growth at this point in time, we want to double down on it to ensure that we can sustain it. Very frankly, margins is not a big pressure for us. Yes, sir. Great. sir, you maintained your guidance of PBT of 20%. Any revision on the revenue front? Any, like you maintained 25%. Any upward revision or anything? Well, I mean, you know what our nine months results are. That is with you and we're Yes. We're seeing Q4 being better than any quarter of this year. It gives you an idea that we're quite optimistic. Okay. Okay, great. Thank you, sir. All the best. Thank you. Thank you. Our next question is from the line of Alisha Mahawala from Envision Capital. Please go ahead. Hi, sir. Good morning. Thank you for taking my question. First, I just wanted to understand, in your opening comments you mentioned that there is some sort of softness or decline seen on domestic inquiries. Similar comments were made in the previous quarter also. Are we now seeing some sort of slowdown in the domestic side? You know, you had such a large ramp up of the inquiry book in the quarters before that when you see 5%, 5% decline in consecutive quarters, it's, I mean, it is a point to be noted. I agree with you, but it's not entirely material. Prasad, when we're talking of, can you give some visibility as to are we looking at inquiries from the domestic market? Yes, sir. Yes, domestic market even on the inquiry size, we are seeing a pickup and decline. The way orders getting finalized or the leads what getting generated, yes, we are seeing still there's an uptick in that. When it comes to inquiry registration, means RSPOs and leads and all, we have seen a little slowdown on that around 5%. Also basically from a particular industry segment, then we see in the domestic also five, six industry segments. In one industry segment there is a little slowdown we're seeing, really we're not worrying on that by seeing the leads what we are getting and finalization based on what it is saying. Can you help us know which segment or which industry is it that is probably taking slightly longer? Is this just delaying decision making maybe because there's been price hikes kicking or in general there has been a lot of commodity inflation? Is this just that maybe some of the demand is now okay or definitely pushed back? No, no. This is a market segment that you all know about. It's a mature space and very frankly it is a large contributor towards power generation. If you look at from aggregate capacity perspective, the country needs to add ample capacity going forward. This is a question of moving from quarter to quarter because they match their cash flows based on commodity price. I mean, it's something that will come back in the coming quarters and years. This demand is not going away. It has to get completed at some point. Okay. Understood. With respect to what the earlier partner was asking, the supplementary expenses are sitting in the other expenses, which means the gross profit has expanded quite, which is a very healthy expansion. Nine months is almost at 36%, significantly above the 30% that we were doing. Is this almost a steady considering the product mix that we have now, the improvement we're witnessing, slightly skew towards explore aftermarket or what will be a more sustainable number? No, very right. I mean, the way we measure it the other way around by saying material cost as a percentage of turnover, which is just the inverse of gross margin. Historically, we've had a material cost somewhere in the region of 50%-53% and right now somewhere in the region of about 55%-56%. We see it coming down in the quarters to come and the years to come driven by two factors. One is we have a better product mix from aftermarket and product. We also have a better turnover mix from international and domestic, as well as general commodity price easing and higher margins, so, on product. All of it point towards a good operating cost. Other expenses may go on with other selling and other expenses that we may need to have. We will incur more expenses on R&D like I've already said. Those will have to be then factored in. We've taken all that into consideration and are still optimistic on full factors such as gross margin, et cetera. Do you think the 50%-56% material cost is what could be expected? No, it should come down. It should come down. Okay, great. Thank you. Thank you. Our next question is from the line of Krishna Kansara, an individual investor. Please go ahead. Hi, good. Sorry to interrupt. Krishna, we're not able to hear you clearly. Can you switch to handset mode and speak, please? Can you hear me now? No, I can't hear you. Sorry. Hello. Can you hear me now? Yes, please. Come in. Yeah. Sir, you mentioned that you saw a decline of 5% in the domestic inquiry book. How do you measure it? Is it a sequential decline or is this YoY? YoY. Okay. Okay. Do you think that this will marginally reduce going forward? I'm sorry. Could you repeat yourself? Sir, do you think that this will marginally reduce as we move forward? Sorry, the question is very unclear. What are you asking exactly? I'm sorry. Sir, do you think that this decline in the inquiry order book will accelerate as we move in the coming quarters? No, we're hopeful that it will expand in the coming quarters, the inquiry book for the domestic market. Okay. Okay. This decline is just temporary, right? That's what we're seeing. We'll have to wait and see what actually happens. Okay. Sir, I just wanted to know your thoughts on the sustainability part of the order inflow. Do you think that you can maintain this run rate of order inflow or order book? That's what we've been talking about for the last hour, to give you visibility as to how we can, we can provide that. I think that you have that information in front of you now. Okay. what I was just asking that. Yeah. You're asking? Can we sustain this growth or it will marginally decline, is my question. In the order book. The order book growth we're looking to try and maintain. The turnover growth of 55% odd is something that, you know, obviously it's a very high number. But on a year-on-year basis, we factor that we will grow very well, and we have the visibility of growth into FY 2024 as well, and inquiry book suggests the growth that we would have into FY 2025. We're in an optimistic stance, which is looking to see any new product release in terms of annual developments that we have on the, either the concentrated carbon on the supercritical carbon dioxide or on the transcritical carbon dioxide products, which will get released over the course of the next couple of years. We'll see newer revenue streams coming for the business. Yeah, we look to sustain order booking and therefore sustain revenue growth on an average basis. Thank you. We'll take the next question from the line of Mohit Khanna from Banyan Capital Advisors. Please go ahead. Good morning, sir, and congratulations for very good set of numbers here. As you just answered my question, just taking this a little bit forward. In the, in the terms of the order book and inquiries, how are different sectors now coming in, especially for the domestic market? I mean, up till now distilleries has been a good contributor. Do you see any sort of change in predatory that distillery companies or other segments that you would like to highlight? Firstly, on the international market, we have a disproportionate order booking which comes from renewable energy-based power production. Which either be directly for independent power production or for captive use. On the Asian side, markets just shift quarter to quarter. If you look at it on an annual basis, you'll see market segments such as distilleries, cement waste heat, metals have come down a little bit, but paper was strong. Chemicals, API, in that form has done well. As we look going forward, you'd see independent power production on renewable basis in India, both from solid municipal waste as well as biomass pick up. You'll find a changing of sugar consumption moving from Extraction Condensing machines to Back Pressure machines, which is a replacement market, which is just so that they can have higher biogas saving and therefore more revenue for them. Demand will change dynamically. Structurally, like I said, the fact is that Triveni operates in two distinct markets. Again, I'll just repeat this, is the industrial heat and power market and the renewable energy-based power production market. On the industrial heat and power market, given that about 50% of end energy consumption is in the form of heating and cooling, and especially when you look at the industrial and institutional form or part of it where heating and cooling is very difficult for that to get disrupted by electricity, be it in the form of renewable or otherwise, because it's far less efficient. Therefore, production of heat on-site is something that is necessary. We cater to that market, which has actually globally expanded by about 5+% CAGR over the course of the last 10 years, despite the fact that the overall utility market has declined considerably to maybe one-third the size of what it was 10 years ago. On the industrial side, that's one. Secondly, on the renewable energy power production side, given the fact that waste is available, both in the form of waste heat, waste products such as municipal solid waste, these are increasingly becoming commercially viable despite subsidies to be able to be formed by developers. I don't know if you had a look at the Inflation Reduction Act and what they're contemplating in Europe as well. This is all despite the real push that is coming on capital subsidies in developed markets. I'm sure that India will have to do the same at some point to spur growth, which is far in excess of PLI, because the PLI is more of a production-mixed, incentive-based scheme. These are more developer-based schemes which are happening in other parts of the world. Right. Just the last question. How are you seeing competition, are you seeing competition getting stronger or, with the increasing in number of inquiries in the market or, it is just as usual? No. Well, the situation in the domestic market is between Siemens and us, and we are very healthy competition. It's intense and we compete, and they're of course a much larger firm than us, and both in India as well as internationally. We compete as peers and in front of clients, and so that is unique to each order because as you know, each steam turbine is customized. And so therefore, there is a competitiveness level on each model, depending on the characteristic that a customer may have. But it's same as it has been. The dynamics is in general as the markets expand, the need to take orders at lower prices declines. The intensity of competition, I have to say, comes down slightly just because the market has expanded. In terms of number of players internationally, we've seen it quite constant as of last year, but in general, there's been a declining trend in the number of participants in this market over a period of time. We've seen the number of competitors decline over a series of years. But I think our push in terms of trying to be the best at what we do and best in this market both in terms of cost as well as technical efficiency still doesn't stop. We will continue our investments and we know what we're good at, and we have to expand our reach in terms of marketing to be closer to customers, have a greater presence because the preference that customers have to place orders is based on the confidence that they have on the aftermarket also. Great. What is the completion date in the nine months? Because we believe it was. It should be in the region of about 6%. Very good. Okay, thank you so much. Thank you. Our next question is a follow-up from the line of Amit Anwani from Prabhudas Lilladher. Please go ahead. Yeah, hi. Just wanted to understand, the decline in the domestic inquiry pipeline. Is it specific to any industry where we are witnessing decline? Yeah, it's in metals. Okay. Second question, sir, if you can throw some light on the makeup-wise inquiry pipeline, anything on that? Actually, we don't give that data, but I'm sure you'll be able to see- Overall, if it is possible for you. Overall. I think you can take that offline with Suji to see if she has information that she can thought. In essence, we've seen good growth in the market and we're quite optimistic. Right. Last question on as we have been, you know, in the past witnessed the low growth phase for at least 57 years. Now from almost 1.5, two years, we are seeing the robust performance domestically and internationally as well. Just to understand how long we are seeing the sustainable growth in terms of domestic market. Is it a complete shift in- No, it's a very good question you ask because the fact is that as you can see from our balance sheet, the company is not really dependent on CapEx to cater towards growth. It's more people-centric. We need people. The fact that we're continuing to invest in people is a good proxy for how much we can sustain our growth. This is something that we have to internally manage in terms of onboarding new people, finding the right people and all the different capabilities and strategies that we need them for. We're investing in the right places, we think. This is something that, I mean, we could afford it in terms of money, but the business couldn't afford it in terms of the sustaining profitability in the past. Great. Thank you, sir. All the best. Thank you. Thank you. As there are no further questions from the participants, I now hand the floor back to the management for closing comments. Thank you very much, and thank you for your good wishes. I think everyone has appreciated the performance that the company has put forward, which is really due to the hard work and dedication of all the Triveni Turbine employees from Arun, Sachin, Prasad and the team in Bangalore. We thank you for appreciating that. We look to sustain this growth into Q4, and we look forward to speaking to all of you in May. Thanks very much. Thank you. On behalf of Triveni Turbine Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.