Thank you, Darwin. Good evening, ladies and gentlemen.

I'm Krishna Bodanapu, Non-Executive Chairman of Cyient DLM Limited. I welcome you to our Q1 FY27 earnings call.

Joining me today are our Managing Director and CEO, Mr. Rajendra Velagapudi, and our CFO, Mr.

R.M. Subramanyam.

Before we begin, I would like to remind you that certain statements made during this call may be forward-looking in nature and subject to risks and uncertainties. A detailed disclaimer is available in the investor website section posted on our website.

The Q1 FY27 performance reinforces the message that I shared in our previous earnings call that the underlying strength of our business remains strong and investments we made over the last few years are translating into tangible results. The quarter was marked by continued geopolitical uncertainties, evolving demand patterns, and disruptions across global supply chains, including the ongoing developments in the Middle East that added further complexity to the operating environment.

Despite these challenges, Cyient DLM remained firmly focused on execution, customer commitment, and long-term value creation. I'm particularly proud of how our teams responded with proactive planning, strategic inventory buildup of critical components, alternative sourcing initiatives, and close collaboration with our customers and suppliers.

These actions enabled us to maintain uninterrupted execution and consistently meet our delivery commitments, further strengthening customer trust and confidence in Cyient DLM. Our strong performance during this quarter is a testament to the resilience of our business model, the depth of our customer relationships, and, most importantly, the dedication and commitment of our people who committed to deliver exceptional excellence in a challenging global environment.

One of the most encouraging aspects of our performance has been the continued momentum in order book. We closed the quarter with the highest-ever order book in the company's history, providing strong revenue visibility and reaffirming customer confidence in our capabilities.

Order inflow remained extremely strong during the quarter, resulting in a robust book-to-bill ratio of 1.5x. This underscores the sustained strength of demand across our target markets and reflects the success of our continued investments in customer engagement, engineering excellence, and operational capabilities.

Equally encouraging is the return of growth across our key business sectors: aerospace, defense, and industrial, all of which delivered healthy performance and continue to present attractive long-term opportunities. The increasing diversification of our revenue mix across these sectors enhances the resilience of our business and strengthens foundations for sustainable growth.

We have also made significant progress in strengthening our commercial organization. Key leadership hiring has now been mostly completed, including the addition of Rama Alapati as the Chief Strategy and Growth Officer.

This enhances our go-to-market capabilities and positions us to deepen customer engagements, expand into new opportunities, and accelerate on our ambitions for growth. While growth remains a key priority, profitable growth continues to be our primary objective.

I am pleased that we now have sustained double-digit EBITDA margins for four consecutive quarters. This consistency reflects our focus on operational excellence, improving revenue quality, disciplined cost management, and increasing value-added engagements with customers.

Looking ahead, we remain excited about the opportunities emerging across our target markets. Rising electronic content, supply chain diversification initiatives, increasing investments across our focus sectors, and the broader outsourcing trend continue to create a favorable demand environment.

With our differentiated design-led manufacturing model, strong customer relationships, and growing execution capabilities, we believe Cyient DLM is well-positioned to capitalize on these opportunities. Most importantly, we have entered FY27 with strong momentum.

The first quarter delivered healthy performance across revenue growth, profitability, and order intake. Supported by our record order book, a strengthened leadership team, and a robust business pipeline, we are confident in our ability to continue creating long-term value for our customers, employees, and shareholders.

I would like to thank our customers for their continued trust, our employees for their unwavering commitment, and our shareholders for your ongoing support and confidence in our vision. We remain optimistic about the opportunities before us.

The foundations we have built, the capabilities we have strengthened, and the momentum with which we've entered FY27 gives us confidence that Cyient DLM is well-positioned for its next phase of profitable and sustainable growth. Before I hand over the call to Rajendra, on behalf of the board, I want to thank him for beautifully turning around the business to a situation where we can now be confident in sustained growth for the future.

We have an order book, we have the people, and we have the customers that will support this accelerated growth. With that, I would now like to hand over the call to Rajendra, who will take you through the business and the operation highlights in yet more detail.

Thank you, Krishna. Good evening, everyone, and thank you for joining us today.

I will take you the next few minutes to walk you through the Q1 FY27 business updates for Cyient DLM. I will keep the discussion simple and clear, and I will focus on three messages.

First, the EMS market continues to offer a large and structurally attractive growth opportunity. Second, Cyient DLM has a clearly phased strategy across: strengthen, expand, and transform.

Third, we are seeing tangible business highlights resulting in growth of the business. With that framing, let me start with the industry outlook, then move to our strategic initiatives, and finally cover the key business highlights before closing.

If you look at it, the electronics manufacturing services market is in a genuinely attractive phase. Importantly, the opportunity ahead of us is expanding rather than maturing.

Today, the global EMS market sits at roughly $625 billion to $650 billion, but the potential we are planning against is close to $1.13 trillion by 2033. We are not building for the market as it exists; we are building for a market that nearly doubles over the coming decade.

The blended CAGR across the market is around 6% plus, and it is meaningfully higher in high-reliability segments where we choose to play. That distinction matters for us.

We are deliberately not chasing commodity high-volume, low-margin work. We are positioning where complexity, reliability, and engineering content command a premium.

Let me highlight the structural trends driving this. First, the electronics content per product is rising across the board: more compute, more sensing, more connectivity in virtually every device.

The second driver is the growth in AI and AI infrastructure. AI is creating new demand for compute infrastructure, data center systems, power electronics, advanced hardware, networking, and related supply chain ecosystems.

While this market will evolve over time, it is clear that AI infrastructure will increase the need for sophisticated electronic manufacturing capabilities. We are therefore treating this as an important area to understand, evaluate, and selectively participate in where we can build a differentiated right to win.

The third, the supply chains are regionalizing. The China Plus One shift is redistributing manufacturing globally, and that footprint realignment plays directly to supply chain resilience, which our customers now treat as a strategic priority, not an afterthought.

The last, on the semiconductor side, the chiplets, 2.5 and 3D packaging, and high-bandwidth memory are all raising the complexity of back-end equipment, test, and assembly, exactly the kind of high-mix, high-reliability work we are built for. Our core segments remain aerospace and defense, industrial, and our focus is also on the semiconductor capital equipment, medical, and automotive, with a sharp focus on power electronics.

Beyond the core, we see two clear new lanes opening. The lane one is robotics, which needs high-reliability subsystems, control electronics, and test assemblies.

Lane two is AI infrastructure and data centers, where AI is generating electronics-heavy, high-complexity hardware that is genuinely well-suited to specialized EMS players like us. The takeaway from this slide is: the core business is attractive and durable, and adjacencies give us room to grow into.

This naturally leads into how we intend to capture this, our long-term strategic roadmap. As we mentioned in the past, we coined it as SET: strengthen, expand, and transform.

The first phase, strengthen, is where we are today. This is a foundation we bank on.

We operate across four industries: aerospace and defense, medical, industrial, and automotive with focus on EV. This is our proven core stack, and it runs at margins of roughly 9% to 11%.

This is the base, reliable, established, and the platform everything else is built on. The second phase, expand, covers FY27 to '29.

The strategy here is elegantly simple: same stack with the two new sectors. We take the capabilities we have already proven and extend them into two new industries: robotics and AI data center, taking us from four industries to six.

Because we are leveraging the same core stack into higher-value sectors, margins step up roughly to 11% to 13%. We are not reinventing our capabilities; we are pointing them at more attractive end markets.

The third phase, transform, is FY30 and beyond. This is where we build a product and platform moat.

We stay across our six industries, but layer in expanded B2S products and new platforms. This is a shift from being a service provider to owning product and intellectual property, and that's what lifts margins to roughly 13% to 18%.

The through line of this slide is a deliberate progression: widen the industries we serve and steadily elevate the value we deliver, moving up the margin curve at each stage. Now let me bring this down to what we actually delivered this quarter, because strategy only matters if it shows up in execution.

The headline is, I think as Krishna said, our order book. We recorded our highest-ever order book at ₹2,598 crores.

That is a strong signal of demand and of confidence from our customers. Order intake for the period stood at ₹551.9 crores with a healthy book-to-bill ratio of 1.5.

Importantly, that was driven by both existing customers deepening their engagement and new customers coming on board. On customer diversification, we added two new logos during the quarter across the industrial and automotive segments.

That matters because it broadens our base and reduces concentration, which is exactly the direction our strategy calls for. On capability and capacity, we completed the expansion of our build-to-specifications lab from 6,000 square feet to 15,000 square feet, more than doubling that footprint and giving us headroom for the product platform developments that underpins the transform phase mentioned earlier as part of our strategy.

We are seeing continued momentum in our B2S product platforms with a strong order pipeline from our key customers. On quality and certifications, we completed the Nadcap audit for cable harness assembly for our Mysore unit.

Nadcap is a demanding aerospace-grade certification, and it reinforces our credibility in the high-reliability work that sits at the heart of our positioning. Taken together, to summarize altogether, the EMS market opportunity is large and expanding, and we are deliberately positioned in its high-reliability, high-value segments.

We have a clear staged strategy to widen our industry coverage and step up our margins over time. This quarter results—record order book, healthy book-to-bill, new logos, and expanded our lab capacity—this was a quarter of solid tangible progress against the roadmap I just described.

As you have seen, we have started the FY27 with a strong momentum, driven by disciplined execution and healthy demand across our key segments. The strong order intake demonstrates our readiness for future growth.

As we move forward, we will continue to expand our focus on new industry segments such as AI infrastructure, data center technologies, robotics, which require high-reliability electronics manufacturing. We will continue to strengthen our position in build-to-specifications in highly complex and regulated industries such as aerospace and defense and healthcare.

Thank you again for your time and for your continued confidence in Cyient DLM. With that, I will hand it over to RMS, our CFO.

Thank you, Rajendra, for the business overview. Good evening, ladies and gentlemen.

I'll now take you through the financial performance for Q1 of FY27. We are pleased to report a strong start to the year with the DLM Group delivering its strongest first-quarter performance to date.

Revenue for the quarter stood at ₹3,738 million, reflecting a robust 34.3% year-on-year growth. This growth was supported by healthy order book, improved execution momentum, and continued demand across our business segments.

On profitability, EBITDA increased to ₹392 million, registering a strong 56.2% year-on-year growth. Importantly, our EBITDA margin improved to 10.5%, representing an expansion of 147 basis points year-on-year.

This margin improvement reflects the benefits of operating leverage, better revenue mix, and disciplined cost management. Profit after tax for the quarter was ₹163 million, which is more than double compared to the corresponding period last year, with a 118.2% year-on-year growth.

Consequently, the PAT margin improved to 4.4%, expanding by 168 basis points year-on-year. The strong PAT performance was driven by revenue growth, margin expansion, and a healthier business mix.

Our order backlog also remains strong at ₹25,989 million, increasing by INR 1,832 million quarter-on-quarter. This represents the highest order book level achieved so far and provides good visibility for revenue execution in coming quarters.

Overall, Q1 FY27 reflects a strong operating and financial performance backed by healthy order intake, sustained revenue growth, margin expansion, and a record order book. We believe this positions us well for continued growth throughout the year.

Moving to the KPI trends, we would like to share quarter-wise of our revenue, normalized EBITDA, normalized EBITDA margin, and normalized PAT performance. Starting with revenue, we delivered INR 3,738 million in Q1 FY27 compared to INR 2,784 million in Q1 FY26, reflecting a strong year-on-year growth trajectory.

Revenue also remained ahead of the previous quarter, with Q1 FY27 continuing the growth momentum seen in Q4 FY26. On normalized EBITDA, we reported INR 392 million in Q1 FY27 compared to 251 million in Q1 FY26.

While EBITDA was lower sequentially compared to 431 million in Q4 FY26, it remained significantly higher on year-on-year basis, reflecting a strong operating performance. Our normalized EBITDA margin stood at 10.5% in Q1 FY27, improving by 147 basis points year-on-year from 9% in Q1 FY26.

Importantly, we now have consistently delivered double-digit EBITDA margins for four consecutive quarters, which reflects the continued strength in our margin profile. On profitability, normalized PAT stood at INR 163 million in Q1 FY27 compared to 75 million in Q1 FY26, meaning PAT has more than doubled year-on-year.

This improvement is aligned with the strong revenue growth and improved margin performance during the quarter. Overall, Q1 FY27 started on a strong note, with healthy revenue growth, sustained double-digit EBITDA margins, and a significant year-on-year improvement in PAT.

Let me now take you through the key operating and working capital metrics. Starting with the order book, we continued to see strong momentum in business intake.

Our order book increased steadily from INR 21.3 billion in Q1 FY26 to 26 billion in Q1 FY27, reaching the highest level in company's history. This provides strong visibility for future revenue growth and reinforces the confidence of our customers in Cyient DLM capabilities.

On inventory, our days—one minute. Give a one minute, please.

On inventory, our days of inventory outstanding stood at 160 days in Q1 FY27 compared to 153 days in Q4 FY26. While inventory levels increased sequentially, they remained significantly lower than the levels seen during much of FY26 and are aligned with our business growth and execution requirements.

Days of payable outstanding reduced over the last few quarters and stood at 63 days in Q1 FY27. This reflects normalization of supplier payment cycles and continued strengthening of our supplier relationships.

Days of sales outstanding remained broadly stable at 77 days in Q1 FY27 compared to 74 days in Q4 FY26, demonstrating continued discipline in collections despite higher business volumes. Customer advances stood at 15 days in Q1 FY27 compared to 18 days in Q4 FY26.

While advances moderated during the quarter, they continued to support our working capital profile. As a result, net working capital days stood at 151 days in Q1 FY27 compared to 145 days in Q4 FY26.

This increase was primarily driven by the movement in inventory and customer advances as we continued to support a growing order book and the future execution requirements. Overall, while working capital remained elevated during the quarter, the business continued to maintain a strong order backlog and a healthy growth trajectory, positioning us well for the future revenue conversion.

Let me now take you through the revenue mix of Q1 FY27 across industry segments, product categories, and geographies. From an industry perspective, aerospace and industrial continued to be the largest contributors to revenue.

Aerospace accounted for 42% of Q1 FY27 revenue, while industrial contributed 32%. Together, these two segments formed majority of our business mix during the quarter.

Aerospace and industrial also delivered strong year-on-year growth of 40% and 90%, respectively. The defense segment contributed 9% of revenue and recorded 35% year-on-year growth.

Medtech accounted for 16% of revenue, with growth remaining broadly flat year-on-year. Auto and others contributed the balance 1% of the revenue mix.

Moving to the product category mix, PCBA continued to remain the largest contributor, accounting for 48% of Q1 FY27 revenue. The PCBA business maintained a high share and delivered 21% year-on-year growth.

Box build was the second-largest product category, contributing 41% of revenue, but delivered strong year-on-year growth of 85%. Mechanical and others contributed 10%, while cables accounted for 1%.

The other categories also include B2S. From our geographical mix perspective, rest of the world continues to account for the major share of business at 94%, while India contributed 6%.

The higher rest of the world share was driven by all our focus segments, such as aerospace, medical, defense, and industrial customers outside India. Overall, the Q1 FY27 revenue profile reflects a healthy mix across key industry segments, continued strength in PCBA and box build, and a strong international revenue contribution led by demand from aerospace, medical, and industrial customers.

Q1 FY27 was a strong quarter from both growth and profitability standpoint. As explained in key highlights section earlier, our revenue increased by 34.3% year-on-year to ₹3,738 million INR.

EBITDA grew faster than revenue at 56.2%, reaching ₹392 million, while EBITDA margin improved by 147 basis points to 10.5%. Employee costs increased in line with business expansion and capability building, while other expenses remained aligned with revenue growth.

Material costs were higher due to the business mix and procurement related to B2S. Importantly, finance costs reduced by 29% year-on-year owing to lower working capital borrowings.

Profit before tax more than doubled to INR 222 million, and PAT increased to INR 163 million, representing a growth of 118% year-on-year. PAT margin improved to 4.4%, up 168 basis points from the previous year.

Overall, the quarter reflects strong operating performance, improved efficiency, and healthy earnings growth. Q1 FY27 has been an excellent start to the year with a record first-quarter performance across revenue, profitability, and order backlog.

Revenue grew 34%, EBITDA grew 56%, and PAT more than doubled year-on-year. Our record 26 billion order book provides strong visibility and reinforces confidence in our growth outlook.

We as a company remain focused on execution, margin improvement, and converting this strong demand pipeline into sustainable shareholder value. Thank you, and we look forward to your questions.

Am I audible, sir?

Thanks, sir, for giving me opportunity. Congratulations on good set of numbers.

Sir, I want to understand the effect of West Asia crisis. In last concall, you said that Israeli approval is not done.

[Wait a minute?]

Sorry, we're not able to hear the speaker very well. Could you repeat the question?

Yes, sir. Am I audible now?

Better.

Sir, I want to understand the effect of West Asia crisis that is going on. In last concall, you said that Israeli approval in some business are not done.

Are they fine or till now pending?

Okay. Effects of West Asia crisis, and two is we last time said that from Israel we still had some orders, etc., pending and we were seeing delays.

How has that changed? Okay.

Hi, Gaurav. This is Rajendra here.

On the West Asia crisis, yes, I think still it is there, going on. As earlier I think Krishna also pointed, in terms of our planned execution and ensuring that we will be keeping some of the inventory for a long run, I think those are the things really helped us to overcome the current challenges what we have in the West Asia crisis.

What we are seeing even now today, there are some delays in the logistics in terms of shipments. We are also seeing some of the cost going up due to this West Asia crisis at this point of time.

As we are already well planned in terms of our execution, we have not seen any of those challenges in Q1, and we also just put a plan together to ensure that those things won't impact much in Q2. To another point about the Israeli things that we are seeing the momentum in terms of the order intake.

That's the good order intake we had from Israeli customers. We see the continued momentum in Q2 and beyond also, going forward.

Hi, sir. Good evening.

Great set of results. Just quickly on the new entry into the data center side, AI side.

Just want to delve deeper there. Any discussion with the hyperscalers which is happening currently, or it's at a very early stage and in coming quarters, you'll give us more information?

Any thoughts on the AI data center entry for the company?

I think we just started this thing, and we have our sales directors on board in this quarter. I think we will be probably giving some updates in the next one or two quarters about where we are focusing and where are we today in terms of our momentum in AI and data centers.

Sir. That makes sense, sir.

Sir, secondly, given the West Asia crisis, which has been hampering our growth at least last year, does it have any problem now, or it's fully resolved? What are your thoughts on that?

As I said just before to another question from Gaurav, I think, yes, West Asia crisis is still there. It has not gone.

The planning what we have done to ensure that we will be getting some of the inventories, holding that wherever we have some challenges for some of the materials, I think that planning has really helped us for the Q1 outcome. Similarly, I think the Q2 also we have planned that, we don't see much of that at this point of time.

Right. Sir, last question from my end, the company is also venturing into the semicon side where you mentioned that testing and assembly, the last end is also in high demand because of the AI play.

Any thoughts on that, what kind of product profiles we're looking to enter on the semicon side? What kind of timelines can we expect in terms of finally that coming into the P&L?

I think probably some time back we just mentioned that we are working with a semiconductor capital equipment, some of the customers. I think we are seeing some of the robust growth plans in that area.

We'll be continuing working towards that and where we are building some of the products for our customers in the semiconductor capital equipment. That's what basically I mentioned in my earlier one.

Just a follow-up, sir. Any thoughts on timeline, when can it materially impact the P&L?

Next year, next to next year? Any thoughts on that?

I think we will be seeing some of the growth coming in that area, over the next 6 to 12 months. We will be seeing more of the revenue growth, which probably in turn will also give us some leverage in terms of the margins, yeah.

Okay. Thanks a lot, sir.

Thank you.

Hi, sir. Am I audible?

Yes.

Sir, maybe just wanted to delve a bit on a similar set of questions. We have this expand target till FY29.

Wanted to just pick your brains in terms of how do you see the overall growth CAGR for the company in this timeframe, '26 to '29, and how much of the contribution would be from AI data center, robotics in say '29 in terms of revenue? Where are we in terms of client approvals, and how long after client approvals do things come into numbers?

Second, maybe in the transform phase, when you say margins could be 13% to 18%, steady state, what are you looking as B2S to an overall contribution to revenue? What would be the margin delta between, say, what we do today in B2S?

That we can probably see how we bridge the gap towards 13% to 18%, and then I'll come up with a follow-up question.

I think when I talk about expand phase, I think you mentioned about the robotics and the AI data centers and infrastructure, I think that is the area where we will be focusing in FY28 and '27 to '29. Okay.

That will be taking some time for us to see the revenue coming in, but the order intake is where we will be seeing it in this year itself. Okay.

I think, as I said, we already have the people on board, we are driving that growth in those new areas. That will really probably give us some leverage in terms of the margin expansion there, too.

Coming back to your other thing on the transform side, you just mentioned that is one of the B2S. We already have our internal plans, both in terms of your expand stage, which you earlier asked a question about what percentage of the revenue will be coming from each industry and also these new two segments.

We already have the plan of actions in that and what will be our CAGR growth going towards for the next two years. Also for FY30 and beyond, the plan what we have for the B2S, the percentage of revenues coming from the B2S in FY30 and beyond.

Based on that, that's where we have just arrived at the margin profile ratio of what we mentioned there, yeah.

Sir, any range on AI data center, robotics that you could give, and by FY29 what percentage? Maybe just another question.

Given you are a net exporter, what factors drove to an FX loss in this particular quarter, if you could sort of highlight that as well? Maybe both these two questions if you could get back to.

Okay. I think as I said, we are not giving that guidance, how much of that growth will be coming from these new sectors.

Okay. As I said, that is internal thing which we have a plan of actions to take.

Okay. We'll probably once we have some new customers in that area, then definitely we will probably let you know in the next two to three quarters, yeah.

On Forex, let me try and answer that. In the last quarter, the last month, the rupee appreciated a bit.

As our balance sheet is pretty exposed in terms of our businesses on the export side pretty large, both on exports and imports. The net impact is what you are seeing on the balance sheet with respect to the last one month where the impact is seen.

Sure, sir. Maybe just one follow-up.

Also, order book, any sort of range that you want to end the year with in terms of book-to-bill ratio?

Book-to-bill ratio, we will be at the same thing where we are today at 1.5x. We will be at that number for the year, too.

Sure, sir. Those were my questions.

I'll get back in the queue. Thank you.

Hi, sir. Congratulations on the numbers.

Sir, I wanted to understand, we see that the medtech segment's growth is quite flat. Wanted to understand why is that, and also how do we see that progress for the rest of the year?

I think the medtech is where we have some seasonal impact in terms of one of our customer right now, which is there. In terms of the growth for the medtech, yes, we don't see any of the concern.

We have the pipeline which is available right now in our sales pipeline. We already have some of the opportunities in that 40 sectors.

We don't see a challenge in anything in terms of the medtech there right now.

Sir, how much of the pipeline is coming from medtech?

Medtech is around that same what we have today in terms of our revenue mix, maybe around 17% to 20% range is where we have today our sales pipeline for the medtech, too.

Sir. Thank you.

Good evening, sir. Thank you so much for the opportunity.

Sir, pipeline nearly 4,000 crore. What is the breakup in terms of vertical like aerospace, defense, industrial, and medtech?

Under platforms like a TSaaS, Lane and Lane 2?

If you're looking at the distribution of that order book, or it's order intake you're asking, order book you're looking at?

Sir, order pipeline, sir.

Oh, order pipeline.

Nearly 4,000 crore.

Order pipeline, no. 4,000 is—

No, no, it's more than that. It's $4,000...

We have not mentioned order pipeline.

$0.5 billion, sir.

That is order intake.

Where are you getting the number of order book?

No, sir. That's a future pipeline, around $0.5 billion.

That's anywhere 4,000 to 5,000 crore range.

No, I think we have more than that order pipeline, okay? The number, I don't know from where did you get that one, but we have a substantially higher pipeline at this point of time, yes.

Very, very high sales pipeline, yeah.

We report order book and order intake, and order pipeline is obviously much ahead of that. That's something which we don't report or disclose any of the numbers.

No, sir. Actually, I'm trying to understand if we have a new growth vectors like AI and data centers and robotics side.

I'm trying to understand that point of time. If you could explain in terms of platform side, whether like under legacy businesses like aerospace, defense, and industrial and medtech, and how that Lane 1, Lane 2, how that things are moving up in terms of pipeline?

I think, see, if you look at it, the various segments what we have: aerospace, defense, close to around 48% will be there in aerospace and defense in terms of the pipeline what we have. Close to 40% roughly, less than 40, roughly on the industrial and semiconductor equipment side, capital equipment side.

The balance is predominantly coming from medical and rest is coming from the medical industry. Automotive is a small one there.

Sir. Thank you.

Thank you for opportunity and many congratulations for a good set of numbers. My first question is related to the ROW sales because they are 40% of a growth on the YoY side we are seeing, but there would be some element of a rupee depreciation as well.

In the same currency terms, how are the growth there?

In terms of reporting, normally we do the reporting in INR, okay, in terms of dollar growth rate. Okay.

We can give the numbers separately to you in terms of we can get back to you on that, yeah.

Second question, sir, your operating cash flow is still negative. What's the primary reason, and when do you expect the working capital to normalize?

Yeah. As I explained to you earlier, the negative free cash flow is essentially coming up from higher inventory and lesser customer advances.

We have talked about earlier as a company, we are growing, and we need to keep making sure that the growth is well-fed in terms of inventory, because inventory is something what we need to do a leading indicator. We have to stock enough to make sure during this difficult time our revenue is not impacted in any way.

We're happy to say that that's something which you've been able to achieve and as you can see in the results, okay? As long as we have this growth, this investments which we need to do it, but once we have the growth and the inventory coming under control, which we are working on, the cash flow will turn positive, and that's what we're all working towards it.

Okay. Last question is regarding the B2S platform.

When do you expect the meaningful revenue contribution from B2S product, and what would be the margin compared to the EMS business?

I think probably we already started having some revenues coming from them in the B2S. We will be seeing it substantially a good revenues from them in the next 1 year to 18 months.

That's what we'll be seeing the revenues. In terms of margins, as I said, the overall when you just look at the combined one, you'll be getting additional 250 to 300 bps additional margins when we have a consolidated EBITDA margins due to the B2S opportunities.

Okay. Thank you, sir, and all the best.

Yes. Thank you very much.

In context of the strength that you saw in the first quarter, can you talk about any sense of guidance for the year? I know last time you said didn't give hard guidance, but you said sequential growth.

My second question is, in terms of your revenue increase sequentially, but gross profit and gross margins declined. Is that a mix issue?

Is that a tariff reimbursement? Can you talk about that, please?

Yeah. In terms of the Q2 and going forward, we will be seeing similar momentum in the range, okay?

We don't see any of major concern on the momentum in terms of our revenues and order intakes. In terms of the gross margins what you said, even though it is slightly higher and it is lower than the last quarter, it is because of some of the investments what we have made into our organization.

The investments are there. We have already budgeted and we already kept it, because that is one thing probably which is just driving us gross margins slightly lower.

Got it. Thank you very much.

Yeah. Hi, good evening.

Thanks for taking up my questions. Can you walk us through in detail on your target—

Is it better now?

Yeah. My first question is on the targets of to drive margin expansion in the medium term.

Can you provide us some color on how much of that margin expansion is coming from new categories like semiconductor equipment, AI servers and robotics, and also how much of the expansion is coming from operating leverage?

I think as I said earlier in the expansion phase, we will continue to do what we are doing it, correct? Those are the industries we will behind the focus.

That is basically our core. We'll continue that.

We'll sustain that. The new industries like AI data centers and robotics, coupled with some of the semiconductor capital equipment, I think those are the things which probably expand us between FY27 and '29, which will be giving us the EBITDA margins of 11% to 13%.

If I may add, I think today the margin expansion what you're seeing is essentially because of filling the hopper and the operating leverage. What Rajendra talked about is in terms of what is going to come in the future, which will be added in addition to that part.

Thank you. Just a follow-up on that.

What product categories are we specifically targeting within AI data centers? Because just if I look at the margins of some of the global players in the AI server segment, it's in the mid-single digits.

Given that we are anchoring on some of these new segments for long-term margin expansion, is it just a product category difference that is driving up margins, or do you see any inherent cost advantage for Indian players?

No, see, it is not an inherent cost advantage or anything. It is basically the products which we are working, for this AI and data centers, and also the robotics, which has been basically high-profile margin business, okay?

As I said, we have the strategy in place. We have put those action items, which are those products which we will be working in these areas, in these new sectors, and what are the revenues we are going to have for the next two years and how that margin profile is going to be.

Based on that, this is what we have put in there where we will be going to be in FY27 and '29 in the expand phase.

Got it, sir. One final question.

In terms of winning businesses in these new categories like robotics and AI, is it something that can be delivered with existing capabilities, or do we need some sort of acquired capability to gain exposure to these segments?

I think for all this we can use our existing capabilities. Probably we need to have some of the key experienced people in some of the areas in the application engineering.

That's where I think we are working out. We have some of the people on board, and some probably we'll be getting the people on the board.

Otherwise, the existing machineries will be sufficient for us to execute that.

Thank you very much, sir. Good luck for your execution.

Thank you.

Hello, sir. Thank you for the opportunity and congrats to the management on a good recovery.

Sir, my question is around the order inflow. Actually, this 550 crore order inflow run rate that we saw in this quarter, I just want to understand how much is it from the existing business, which is our old business, that is aerospace, defense, medical, etc., and from the new logos that we've onboarded last year?

Basically, I want to understand how much scale have we achieved from the sales efforts we did last year, and how much more can we juice out from the new logos addition? That's the first question.

Next thing is this 550 crore, were there any lumpy, one-off orders in this, or this should be the new sustainable run rate for the company, and can one extrapolate this run rate for the full year? That's the next question.

Sir, thirdly, you've mentioned AI data centers and robotics in your slide, can you just give some details on what products in data centers that you're targeting or robotics that you're targeting? What capabilities that you've built in?

I just want to hear the strategy that you guys have in place to get the business from these two new segments that you're targeting. Thanks.

Okay. I think in terms of the order intake which we had, there was no lumpy order intake in that, okay?

That was all as we see from our existing customers and the new customers, okay? Also your other question is whether are you going to maintain the similar things for the year.

As I said earlier, probably we'll be there at 1.5x of the book-to-bill ratio in that range for over the year also. The other thing which you asked about is on the mix.

Mix between the new segment from the existing customers versus the new customers whom we added in the last one or two years. If you look at that one, probably close to around 70% of that is where it is from our existing customers, and the balance 30% is from the new customers whom we added in the last four equipment, at least the last four to six quarters.

I think, Deepak, to extend that to your question you asked, there's a lot of opportunities we've seen with those customers.

Absolutely, yeah. There's a lot of opportunities from that existing and the new customers there.

Another thing which you asked about, I think earlier also just mentioned about on the AI and data centers, I said we have the people on the board, we have put the strategy in place. Probably just we will come back to you in the next two to three quarters when we'll be seeing the products which we are going to focus.

As I said, we don't need any huge capex for that. Existing machineries will be sufficient for us to execute any of those products which we are looking at.

We also, as I said, we have some people on board who will probably working with our new prospects in these areas going and talking with them. I think it is going to be the expansion plan from FY27 to '29, okay?

This is what we just want to just make you sure that the focus is there, that's where the growth is going to be, and that's where I think you'll be seeing the both the revenue growth and also the EBITDA margin expansion, both.

Okay. Sir, just on the order inflow run rate, you mentioned 1.5 times order book to revenue, we are already at that rate today.

If I assume that you're going to grow at a healthy 20%, 30% this year, your order book is already 2,600 crores, which is more than 1.5 times. What kind of number that we should look at in terms of order inflows for this entire year, if you can help us understand that?

That would be useful.

Deepak, probably I think we are not giving that guidance in terms of the number right now. As I said, we'll be having a 1.5x is what I will just say that we'll be there for the year.

Yeah. I think the guidance-wise we are not giving that where we are going to be, what the order book is going to be by the end of the financial year.

Deepak, RMS here. I think Rajendra talked about the aspirational revenue growth rate and the book-to-bill ratio.

I'm sure you are good enough to calculate, yeah? Thank you.

Okay. Thank you.

All the best.

Hello, am I audible?

Yeah. Thank you so much, and congratulations on a great set of results.

Question for Rajendra. Just wanted to quickly understand, because if I see over the last three years, right, there's been a lot of defense going very fast, then peaking out and then completely vanishing from FY25 number, and because of the BEL order, then industrial seeing the up and down, but out of all this, aerospace is the one place where we've continuously grown.

Over the last three years in the 4Q run rate, we've expanded 4x. Wanted to understand what is the strategy, how are we able to grow and maintain this space?

Also our large customer like Honeywell Aerospace and Safran and Thales, they are more and more talking about that they want to expand outsourcing from India. How are we placed on that?

It's a bit of on the what has worked and how are we placed. A bit of strategic question rather than a guidance question.

I think as probably I just mentioned earlier, we are very well placed on the aerospace side. I think Honeywell, which I just mentioned about some of the big work which we had won couple of years back, I think that is where right now some of the initial builds are happening, we will be seeing the ramp-up coming on those things in the next 18 months.

That's where we'll be seeing a big growth coming from the Honeywell Aerospace. I think we have a very good engagement with them at various levels.

That account, and you also said about the Thales, I think both of the accounts is there we'll be seeing an extraordinary growth in this year.

Just to add to that, the aerospace business is a double-edged sword. It's very, very difficult to get into, but once you're in, you're in.

We're fortunate that we're pretty much in with every single major OEM or significant Tier 1 that buys any electronics. Obviously Rajendra mentioned two, Thales and Honeywell.

Those are the large ones, but there's also many, many others. I think it was a deliberate choice, and now, of course, for the first few years, aerospace is always an investment, but it was a deliberate choice to build a very strong aerospace business, because aerospace and defense gives you a steady revenue stream on which we can build many other things.

Like if you look at the data center business, the reality of that is it is up now, it'll go down. That's just how some of these technology-related businesses work.

Aerospace, what really differentiates us is a strong aerospace capability, because that's a moat that's very, very difficult to breach for a new entrant, and we're in the moat, and we're very strongly placed in the moat. I think that's a very key element for us, and that's why I just want to highlight that.

Understood. Understood.

Just last question from my side before I come back in the queue. One, on the aerospace, SkyDrive has started receiving a lot of certifications from the aerospace or airframe authorities, and it is one of our large B2S pipeline.

How are the discussions going over there? Do you think that it will fructify much sooner than expected?

Second is on the entire defense spend, and this again ties into that we are in, I would say, each and every European defense at this point of time. How are we seeing that pan out?

Two questions, both on aerospace and defense.

On defense spend... you're asking about defense spend?

Yeah. Two questions.

One is on SkyDrive B2S, because they are getting certification much faster than expected. Because they will also start making their aircrafts.

Is there a possibility that we start booking the B2S revenues much sooner than expected on SkyDrive, if those are the discussions that are going on? On the defense side, specifically on the European defense, because the reason I'm asking this is that because we are in I would say in each and every defense company in Europe.

BAE Systems, Safran, Thales, and then you also onboarded a few other defense companies over the last four, five quarters. How are we looking that panning out?

Two questions, both on aerospace and defense.

Okay. I think the one which you mentioned about, it's one of the Japan customer, which we mentioned earlier, they are all the UAVs which we are working out with them.

As I said, we are doing it currently the engineering designs for their products, for B2S products. That will be probably taking another year to an 18 months for us to come into the production line, okay?

That is the one which is a probably very high-end and it is a long-term for us, as Krishna said, those are the customers once you come in and particularly if they are on the build-to-spec, I think we are the ones who will be doing it throughout the life cycle of the product. We will be maintaining the product there, okay?

That way, I think that is the one business which we are very, very strong with that customer in Japan. The other ones which you said about other aerospace customers, I think we continue with them.

We are working with them the value what we provide, I think in terms of their—

No, the second part is on the European defense. Aerospace, I understood, that Krishna and you also spoke in detail.

On the European defense, are we seeing a lot of negotiations, pipeline building up on that side?

I think there is one right now that is also a part of a build-to-spec which we are working out with one of the European defense organization. It is an early stage at this point of time, but it is there in our order pipeline.

We are working out towards...

Deepak, is your question specifically B2S for European defense, or are you looking—

No, not B2S. It is on the demand trend.

Okay. On the European demand, I think one of the thing which we already mentioned Thales earlier, correct?

We are working out with them. That is again a defense customer, we continue and we are very, very strong in terms of our engagement with them, the value what we provide to them.

We also have other defense customers in Europe, which probably I don't want to name it at this point of time based on the confidentiality agreement which we have with them. We are working on the build-to-print, apart from what I said earlier is the build-to-spec is another one going on, but build-to-print is continuing momentum is still there, I think very, very strong momentum both in North America and Europe.

Understood. If I can just—

No, this is my last question. This will be the last, if it's possible.

Yeah. On Altek, because our strategy on medtech is a barbell strategy where we also deal with a lot of early-stage and startups in the product side.

With Altek, with ITAR, is there a possibility that we can start working with defense technology in North America?

That's what I think we have now one project going on right now for one of the defense customer there. We have the ITAR facility, which as we said, ITAR-certified one.

We are working out with a few more other US defense customers there, it is still at early stages of our pipeline. We see and value there what we can bring in to our customers in US, the defense customers in US.

Yeah. Hi, sir.

Thank you for the opportunity, and first of all, hearty congratulation for a good set of numbers. Sir, my first question is that, as we are going in expansion phase in FY27 to '29, particularly in the AI, data center, and robotics projects, just wanted to know, in that segment, particularly in which product side that we are venturing?

It is from a rack side, or a cooling side, or power supply side? That is if you can shed light on that.

Second thing is that how much incremental capex, particularly for the expansion phase and from the transformation phase, that we are going to spend for next couple of years? These two things sequentially.

Thank you so much.

I think, as I said probably earlier, I think we are still working out on that. We have the strategy in place, I think the team is in place right now.

Probably we will be letting you know in the next two to three quarters where the focus, which are the product lines which we are going to work and which we are working out in that area, both in the AI data centers and the robotics, okay? Other one is the capex, correct?

The capex, I think, as you said, whatever we have today close to around 1.75 to 2x of the revenue, we don't need any such additional capex apart from a regular annual capex which we will be working out for our running the business.

Sir. Thank you so much.

Thank you very much, and thank you, everybody, for joining the call this evening. Obviously, it's been a very good quarter, and again, I want to compliment Rajendra and his leadership team for delivering an excellent set of results.

Also, I want to assure you that I think a lot of the challenges of the past have been overcome. We find ourselves in a very good position, both with the core business, which is aerospace, medical, defense, and industrial, but also with some of the expansion that we're looking at, which includes semiconductor equipment, data centers, etc.

I think we find ourselves in a good spot. Thank you for the patience.

Thank you for the support. We'll again speak next quarter, but I want to assure you that we will keep our focus on delivering and continuing to deliver a good set of results going forward.

Thank you.

Thank you.