Thank you, Steve. Good day, everyone, and a warm welcome to all of you participating in the Q1 FY '27 Earnings Conference Call of Triveni Turbine Limited.

We have with us today on this call Mr. Nikhil Sawhney, Vice Chairman and Managing Director; Mr.

S.N. Prasad, the Chief Executive Officer; Mr.

Sachin Parab, Chief Operating Officer; Mr. Lalit Agarwal, Chief Financial Officer; Mr.

Manikantan Rajendran, Chief Marketing Officer; and Ms. Shreya Sharma, Head of Investor Relations and Value Creation.

I'd like to now hand over to Shreya Sharma to make it Shreya's opening remarks. Over to you, Shreya.

Thank you, Gavin. Good day, everyone, and thank you for joining us for the company's Q1 FY '27 earnings call.

I hope you all had a chance to review the results and the accompanying presentation uploaded on the exchanges and on our website earlier. Our discussion on the call will follow that presentation.

Before we begin, I would like to remind you all that some of the statements made today may be forward-looking in nature and are covered by the disclaimer of the earnings presentation. Joining me on the call today is the senior leadership team who will take you through the key business developments and performance for this quarter.

After the remarks, we will open the floor for the questions. With that, let me hand it over to our Vice Chairman and Managing Director, Mr.

Nikhil Sawhney. Over to you, Mr.

Sawhney.

Thank you very much, Shreya. Thank you, Gavin.

A very good afternoon, ladies and gentlemen, and thank you for joining the Q1 FY '27 earnings call for Triveni Turbine Limited. As we had anticipated, the quarter remained challenging.

Revenue from operations came in at ₹4.43 billion, up by 19.2% year-on-year. Domestic sales grew by 27.4% to 2.4 billion, and exports grew by 10.8 billion to ₹2.03 billion, taking the export share in revenue to 48.8% against 49.3% in Q1 FY '26, a reflection of a stronger domestic contribution this quarter.

Profitability, however, was softer in the quarter. EBITDA stood at ₹797 million at a margin of 18% against 25.8%, and a profit before tax of ₹697 million was down to 20.1% of revenue was down 20.1% at a margin of 15.7% as opposed to 23.5% at the same quarter of the previous year.

The execution in this quarter reflects the business environment and order intake of roughly a year ago. The softer order mix of H1 FY '26 has carried through to Q1 FY '27 profitability.

Delivery phasing of certain strategic orders have also added to the softening of margins. With delivery spread across quarters and this quarter's revenue including the balance brought out scope of certain projects, a majority of this would be taken care of within the first half of this year.

We remain optimistic on growth of both profit as well as revenue for the full year FY '27, which will of course be back-ended as suggested by the note. The balance sheet for this quarter has also improved even though we're not reporting it as a difference between Q4 FY '26 and Q1 FY '27 is a reduction in receivables and therefore a reversion to negative working capital and an increase in the cash balance of the company.

On the order booking front, the order booking for the quarter stood at ₹5.68 billion as compared to 5.36 billion in Q1 FY '26, a growth of 6.1% year-over-year and increase led entirely by exports and the aftermarket. Export order booking grew 53.4% year-over-year, accounting for 68% of the total order booking as against 47% in Q1 FY '26, reflecting continued traction and momentum.

Can I ask someone to put it on mute because there's a reverb coming on the?

As I said, export order booking grew quite healthily and accounts for 68% of the total order booking as opposed to 47% in Q1. This reflects our continued traction and momentum across Southeast Asia, Africa, and Europe, and across segments such as biomass, waste to energy, in addition to the conventional segments.

The share of aftermarket order booking increased to 39% of total order booking compared to 27% in Q1 FY '26, a growth of 54%. Domestic and product order bookings witnessed a slowdown during the quarter, lower by 35.4% and 11.6%, respectively, on a year-on-year basis.

The higher share of exports and aftermarket orders reflects the continued strengthening of our business mix. It is improving the quality of our order book and shifting the portfolio towards better-margin offerings, which should support the profitability as we execute those orders.

The overall order book also witnessed an improvement. Our international expansion strategy coupled with continued innovation and entry into new product segments has yielded encouraging results.

The closing order book stood at ₹21.8 billion as of the 30th of June as compared to 20.74 billion a year ago, reflecting a 5.1% year-on-year increase. Export order booking accounted for 57% of the closing order book.

The aftermarket business also continued to gain strong momentum, with closing orders increasing 115% year-over-year to 6.24 billion on the back of contract wins in the geothermal and utility segments and continued traction in the refurbishment and performance optimization solutions, which contributed 29% to the closing order book. This performance underscores the company's agility in operating across geographies and sectors, positioning us well to capitalize on emerging opportunities across geothermal, process industries, utility scale refurbishment, and renewable thermal solutions.

The growing global emphasis on energy efficiency and decarbonization coupled with renewable energy adoption and decentralized power generation continues to generate and create strong and sustained demand for our products. Having said that, as we look forward, the inquiry generation in the international market has improved while the domestic market has seen weakness.

As we report our inquiries on a six-monthly basis, and we'll continue to do that next quarter. While we can internally see weakness, we're optimistic that this domestic market will show some signs of recovery in the coming months as well.

During the quarter, our US subsidiary continued to receive healthy inquiries as well, and that's a market which continues to grow in both inquiry book as well as our optimism towards future demand for both products and aftermarket services from a very large market. Our focus there remains on strengthening the local service and product capabilities and deepening our market presence and building a strong term footprint in the Americas.

As highlighted in our previous earnings calls, we continue to invest heavily into research and development, and we continue to develop newer product ranges in newer lines which can help expand our offering to our customers to ensure that we can utilize any heat or waste heat requirements that they may have to generate an effective return by either providing it for process requirements or towards generation of power. This includes the development of our organic Rankine cycle developments, and we are keen to expand this in the coming year.

Going forward, we're well positioned to sustain its sustained growth, and this is coupled with our digital offerings. As of this current quarter, we have actually transitioned the role and position of our COO to that of business transformation to look at AI-specific initiatives.

This is a further reinforcement of what we believe the company needs to focus on in the future, which is to be extremely agile and focus on productivity while still ensuring that we are able to cater to customer delight and ensuring our product relevance to our customer base. Therefore, while this current quarter has exhibited the situation that of how geopolitical uncertainties can bring volatility in both dispatch and order booking, I'm sure that you'll have more questions on why our margins have been what they are and where recovery would be.

I'd rather take that in the questions and answers than answer it right now. Suffice to say that the company is optimistic on the growth both in margins and absolute and on a percentage basis in the second half of this year.

As we look at the full year FY '27, we are confident to exhibit top-line and bottom-line growth. With that, ladies and gentlemen, I'm happy to take questions and answers.

Hi, thank you. Thanks for the opportunity.

My first question is what was the impact of the NTPC, or there has been probably there was execution coming in Q1 also. Was there an impact there, and what was the quantum?

That is my first question. Second, in terms of you have written about the I think cost push also, what was kind of contribution of impact from the commodity inflation also in this quarter?

Okay. Your question is around margins essentially and how we've exhibited margins this current quarter.

It's not a question of making excuses, but the fact is that they are execution of certain orders, especially on the export side, have gotten deferred by clients because freight rates have gone up between three to four times. Those have gotten pushed from Q1 to Q2 to maybe Q3 even.

What ends up happening is that when you have a higher percentage of domestic execution as part of the revenue mix, that is, of course, depressing on margins to begin with. Secondly, you have, as you rightly pointed out, a strategic order that we've taken on the NTPC carbon dioxide-based energy storage project, which was a validate which is essentially meant to validate technology and to prove the use case for our equipment.

This of course was taken at negligible and near-zero margins, and so that does not contribute to profitability at all. I'll ask Prasad to comment a little bit about the quantum of the NTPC project.

You will have to know that the NTPC project is due for commissioning in Q2, and so we will have certain revenue in Q2 as well. Prasad, can you give a little bit of idea about the NTPC project

and

domestic and other situations on margins?

Yes. I'll put it like this.

Before getting into the margin on the NTPC project, as VCMD rightly mentioned that this is one of the technology validation projects because this is the first of its kind when it comes to the energy storage through CO2. Yes, we have taken this project knowingly, this may not be contributing to the bottom line in the initial years, but once the technology is proven, this is going to bring a lot of value add.

The positive thing is this technology, where the pilot plant is running in Europe, that started giving very positive results. Even site execution going at faster pace, probably by end of Q2, early Q3 it will come to commissioning phase of this thing.

Basically, since this we forecasted these margins, there's nil margins sort of a thing from this, the major contribution is the share of domestic orders in the revenue mix is increased. That is a main pull down on the margin sort of a scenario.

That way in addition to whatever international orders, couple of orders where because of the freight and today vessels not availability, those things affected. Some of those planned export orders shifting to Q2, Q3.

Otherwise, overall, we are quite confident overall year there will be a positive traction in terms of revenue growth as well as a profitability growth.

Right. Second question on the inquiry book.

Last time you highlighted the, roughly about 18 GW for the globally inquiries and domestic inquiry was about 7 GW. How that has grown, and what is the primary reason for the domestic slowdown, any particular industry or are you seeing delays from the customers in terms of conversions of orders, or if you could deep down more on the domestic side?

That would help. Yeah.

I hesitate to give you exact numbers on inquiries on a quarterly basis because the market does not move that quickly. It's better to take it over a period of time.

We will be sharing the numbers exactly and on the six-month and full-year basis. Having said that, we see the international continued strength in certain markets in the international market in terms of revenue in inquiry growth, which includes the United States and Southeast Asia.

There's some green shoots in Europe as well. The markets in North Africa, Middle East are quite depressed.

The SAARC region remains depressed. The Indian market has seen a decline, and that's broad-based across all industries.

It's not a reflection of the conversations that we're having. An inquiry is a potential demand.

When we are having conversations with customers, it seems to suggest that the market is sort of flat, but even though the direct inquiries which are part of our order inquiry book have come down in the domestic market.

Sure. Lastly, you spoke about the top-line and bottom-line growth.

Is there an expectation we're building that probably will be able to cross the double digit, or it will be less than a double digit this year?

We don't give visibility to that extent, but the fact is that you see what our We are a company that has to execute our order book. The growth of our order book reflects what we have to actually execute.

As we get into larger-size orders, those have longer duration execution cycles. Suffice to say that we're quite confident of growth in this year.

The team is all geared to execute on it. We, of course, still need certain book and bill of spares to come in, which have shorter duration execution cycle.

A lot some of that will depend in the coming quarters in the coming months in terms of the order booking. Again, we're optimistic based on our current order booking and order book size on the growth anyway.

The extent of growth I think should be on the higher end of what you're suggesting.

Understood. Thanks, Nikhil.

Thank you so much for answering my questions.

Hi, sir. Thanks for taking my question.

My questions are also in similar lines to the previous participant. With respect to the NTPC CO2 storage, how much of revenue contribution would have happened during 1Q?

Given the fact that this will get commissioned in 2Q, how much amount of execution is likely to happen during that quarter? If you can share that, that would be my first question.

We don't give a real break-up of revenue from order to order. I think he had alluded at the end of Q4 that we still had about 100 ₹175-odd crore of the order to get executed.

It would be split I would say maybe 40% odd in Q1, Q2, and then the rest in Q3.

Okay.

And Please continue, Navin.

Yeah. This ₹170 crore would be largely the bought-out item cost.

Is that understanding right? Just trying to assess whether similar impact would be seen in 2Q also.

What I'm trying to assess. No, there's no See,

cost escalations have already been forecasted to whatever extent that there has been, and I think the previous caller also did allude to the fact that to what extent did cost escalations lead towards margin decline. It wasn't to such a large extent.

The fact is the orders were taken at a point in time when there was volatility in commodity pricing. The commodity pricing was taken at that point in time itself, and those margins, especially on the domestic orders, were already low at the point in time that we took them.

They'll be executed in line with our expected margins. None of this is coming as a surprise to us.

This is pretty much the way it was meant to be. The only thing that has come as a little bit of surprise is in our export orders, as freight rates have gone up three, four times, the availability of vessels have become a little bit less easily available for our customers, that as well as possibly certain site activities may not be have kept pace, that customers have pushed out some of their dispatches that they need from us.

This largely happens on the export side only because the domestic market doesn't suffer from those same problems. That has just led to a delay in recognizing revenue and billing that.

I feel that all of this will come back on track in a period of time, because what this geopolitical uncertainty has done is it's made everything a lot more volatile. Where we thought that we would be lumpy on a half-yearly basis, now it's come down to quarterly basis and monthly basis.

It's becoming I guess for us to smooth it out, we need to have a much larger order booking so that we can display that. I think that this lumpiness will continue for a couple more quarters, both on the positive and negative side.

You may have a negative quarter like this, but then you'll have positive quarters as well. We shouldn't read too much into those positive quarters also.

Understood, sir. With respect to the inquiry pipeline, or rather with respect to the domestic market, you had mentioned that commentary or ordering did have a dip there during this quarter.

Is it just that the order finalization is getting differed a bit, or is it that the inquiry levels themselves have dipped a bit? Because in the previous couple of quarters, your commentary on the domestic market was relatively on the stronger side.

Is it just that the order finalization is getting delayed? If so, why is it getting delayed?

Is it because of the war and all these things that the domestic market customers are delaying order finalization?

I think the previous caller also had the same question, and let me answer. The inquiry book is a status of vague or general demand in the market.

The order finalizations themselves would translate into market share and an order booking. The decline in an inquiry book in the domestic market means that certain demand has just left the market.

Again, I'm saying, that this is if you start tracking this on a quarter-to-quarter basis, I think it that we've done it internally, it gives us the wrong impression in terms of the priorities. I don't think it's a matter of concern if the market declines just 2%, 3%, 4%, 5% because the entire market is so is the entire inquiry book, as we reported at the end of last quarter, is so large that it is several times annual demand in the domestic market anyway.

Understood, sir. My

Let me ask Prasad to comment a little bit about this as well, and maybe you could bring in Mani, Prasad.

Yes, sir. Yes.

In the domestic market, yes, the inquiry pipeline suddenly in previous quarter we have seen a little slowdown on that. Even order finalizations, we experienced a little longer gestation periods, means customers not concluding the orders immediately like earlier quarters.

Even in a domestic customers just waiting and watching, but by considering whatever opportunities which are open for finalization, we feel that it should bounce back. Mani, you want to add any specific points?

Yeah. Now, in our kind of a business, for the products, the gestation period is anywhere between 6 to 12 months.

Now, the orders which get finalized in this quarters are the ones for which the inquiries were received six months or 12 months earlier. Now, the trend what we are now talking is with respect to the inquiries which we have received in this quarter, there has been a softening.

This would be order gets finalized much later. What is more important is for the current few quarters is what the inquiries we have in hand, and the inquiries which we are receiving is going to be getting finalized few quarters later.

Now, on the inquiry finalization, we do see the numbers as well compared to last year. Though the inquiry generation for this quarter, there is in the domestic market, there is a dip.

This is how I would conclude.

My final question is with respect to the progress in growth in API turbine and also in the US market, the status of providing aftersales service to customers and also possibly supply of products to customers.

Mani, why don't you take that as well?

Yeah. In terms of API business, we see a lot of traction.

With a number of thermal power plants coming in India, we see a lot many things happening. Also with the oil and gas, especially while there are opportunities which we are seeing, because of the ongoing geopolitical tensions, the decision-making is getting deferred.

Though there is a potential and there is it's only a matter of finalization which is getting delayed, I would say. We are also now looking at oil and gas opportunities north beyond the Middle East market in Americas as well in European countries.

In this particular quarter, we have secured API business orders from Europe as well. This is on the API business.

Now with respect to that US market, we see a lot more traction. Now there is a huge scope for data centers.

The last few years, they have been predominantly powered by the gas turbines. Now with the ongoing demand for gas turbine, the delivery is anywhere between three to four months four years to five years.

We see the companies going towards the other modes like conventional route, combined cycles, then we're also seeing small modular reactors. There is a large amount of traction we see, number of inquiries from the American market, and it's only a matter of time these gets converted.

Thanks a lot. I'll come back in the queue.

Thank you for the opportunity. My first question is with respect to the bought-out components.

Out of the total COGS, can you give us an indication of how much would be the bought-out component, and was there any price inflation in that which we were not able to pass through?

We have a fixed-price contract, there's not a question of passing through price escalations. Unless the customer delays orders, usually these price escalations have to be absorbed at the point in time of the contract itself.

Usually we work on rate contracts, but I'll ask Prasad, maybe you could comment on the quantum or Lalit, if you're there, you could comment. Prasad, maybe you can start first and then you could bring Lalit in if necessary about the quantum of BOP.

I would suggest to be a little vague rather than give an exact number, please.

Yeah. Two ways I will address this thing.

One is, as VCMD mentioned that, these are all fixed contracts because as far as the customer is concerned, it is locked fixed locked price. During the execution, if any commodity price increases there, that is a risk what we carry along with us.

Suppose if the volatility is too much, then sometimes that hits. In the beginning of when we are picking up the orders, we also monitor this very carefully.

In majority of the cases, that is a derisked appropriately costing some contingencies sort of a thing. Then order to order, bought-out item percentages changes.

The scope, customer to customer, it changes. There is no standard scope between two contracts.

This is the variation is to a large extent. Sometimes bought-out percentages may be something like 30%, 40%, sometimes maybe 60%, 70%.

We cannot generalize that. Again, that also quarter-on-quarter, the way how deliveries takes place based on the readiness, that mix also changes.

Lalit, you want to add some points on that?

Yeah. There is no fixed percentage with respect to the balance of plant which is being procured, it varies from order to order between 30% to 70%.

That is what we like to mention.

Understood, sir. My next question is with respect to the R&D initiatives that we have been taking in the past with respect to the new products heat pumps, mechanical vapor recompression.

Any traction on that you can share with us right now?

Yes. Prasad, can you please comment on Both of these are areas which really do allow our capabilities as a company to be brought to the front.

Some areas like heat pumps, when we combine them with steam generation end up having greater industrial applications. You have to look at them in sequence of development.

Prasad, maybe you could give an overall impression as on these two current product lines as well as future product lines that we may be developing.

Yes, sir. Yes.

Heat pumps basically as a company we are not seeing heat pump as a standalone product. We are looking overall solution.

Basically combining heat pump along with MVRs. This gives a total solution to customers.

Basically customers where is a low-pressure, low-quantity steam requirements, this combination can replace a small package boiler sort of a business opportunities there. As some of you are aware, we created a demo unit for a heat pump, and some of the MVR orders which are under execution, that initial orders.

We are confident this combination going to Okay, it is taking time, and it will take time because this is a new technology, and some of the customers wants the experience of this combination giving the desired results in terms of efficiency, in terms of return on investment, and all those things. This is the initial phase of pushing the product pushing the solution into that.

It is taking time. Otherwise, yes, these things are going as per plan, and we are confident this is going to bring a good value addition in near future into this thing.

In the similar way, we continue to invest into new technologies and new solutions. When it comes to new technology and new solutions like ORC, we are in touch with customers.

Inquiry pipeline is increasing for this thing. That's also as a ORC solution, the customers looking for the power generation from low heat.

Today, this is unaddressed market or largely underaddressed market by majority of the players around. That inquiry pipeline is increasing, and this market is across the globe sort of a thing, including Americas.

The other area where we are working very closely, combining the ORC with a geothermal combination sort of a thing. Basically, as our technology innovation, what we are focusing is rather than a product as a overall solution, combining two products and finding a better efficient solution, cost-effective solution.

That is really on track, and it's going to give a positive results in near future.

I think what is a very important part. We're a single product company, and as we add multiple products to our offering to one customer, that becomes more of a solution orientation.

We will do it incrementally without taking on sort of EPC responsibilities and the liabilities that come along with that. The point is to offer a better technical solution to our customers and ultimately give them a better payback for whatever they desire.

Understood, sir. Sir, just one last question if you may allow.

With respect to the consolidated EBITDA margin, we were somewhere around 20%, 22%. That has fallen significantly this quarter.

As you explained, these are because of some specific reasons. For H2, what kind of sustainable EBITDA margins or going forward we can expect because now you have the visibility of the orders that you have taken and based on that you would also have the visibility of margins that you would make.

If you can just throw some light on that.

I'm not going to be very specific on giving you a number, but I'll take you back to what we've always said as a company to our investors and on these calls is that as a company, we believe that a PBT margin of over 20% is something that we can maintain in the medium and long term, and so therefore that is something that we will definitely reinforce.

Understood, sir. Thank you so much.

Yeah. Thank you, sir.

Sir, first question is on the global data center opportunity that we had highlighted in the last quarter. In Q1, either for us or for other global steam turbine makers, has this opportunity started getting converted to actual order placement, or is it still in advanced evaluation phase?

Mani, can I ask you to please answer this question?

Yeah. In terms of global data centers, as I mentioned earlier, I was personally there in US last couple of weeks.

Now, we have visited several customers. Now, there is a huge demand.

There is no question about it. There is a huge demand for data centers.

Now, so far, as I mentioned earlier, they were using gas turbine to speed up the process so that the power can be generated as quickly as possible. Now, with the lead time for gas turbine going to four years, people are looking at other avenues to power the data centers.

Now, we have had multiple inquiries. There is a growth in the inquiry base book from US.

Same thing we also see in other parts where data centers are involved. Now, it's a matter of they switching from the gas turbine to a conventional cycle or a combined cycle.

We are hoping it could translate in this year. We are hopeful.

Sir. Second thing on the aftermarket service division, in Q4 as well as in Q1, we have seen material rise in the order inflow.

If you can highlight if any specific areas like retrofitting or utility power turbine orders, etc. for this aftermarket solutions is part of this last six months, and is this a ₹150, ₹170 crore kind of 250 I'm not trying to get an exact number, but can aftermarket's annual quarterly inflow be materially higher than what we were doing so far?

The attempt is to have multiple avenues of growth for the business. The aftermarket business is reliant on two streams.

One is our own installed base and the growth of spares and service to that. The second is refurbishment, which actually has a much larger market based on a larger installed base of rotating equipment.

Now you've seen a very strong growth on the refurbishment side and exports as we have invested in local capabilities. Those take time to build up, and those are in certain areas such as gas turbine utility businesses which provide long-term and high margin good margin visibility for the company not only for this current year, but for coming years.

Do you want to add on the outlook on this, Mani, for refurbishment?

Yeah. Now, on the aftermarket, as Mr.

Nikhil said, now, we have had a good translation of orders across the sectors, whether it be across the region as well, be it in Southeast Asia or in Africa. There has been a good jump in African market.

We also see some traction in India on the refurb side. On the sector-wise, we have seen on the gas turbine as well as in the geothermal, biomass, the old utility turbines.

We are now getting into the utility segment on the high to a higher value addition in the utility segment from the industrial segment. Those are the ones which are coming in.

That is why you are seeing the values going up.

Sir. Sir, lastly, sir, you mentioned that some of the export orders have been differed by one to two quarters due to logistics cost and freight rates rising significantly.

Sir, just wanted one clarification here. Are this freight rates and logistic costs, does it come under our preview, or does it is it something that the clients bear?

No, it's on the clients. That's why it's their flexibility.

Okay. All export orders of ours, the logistics and freight rates are borne by clients?

It's FOB.

Sir. Thanks.

Hi, Nikhil. I have just quick two questions.

First on the after-sales traction that we have started seeing, some very encouraging numbers. You can highlight in last two quarters when we won some 6 billion orders, broadly how much is that from North American region?

If you can give some color, Prasad can add on what kind of size can we attain in next two to three years? That's my first question.

Amit, that we've had a limited presence in the US market from the perspective of installed base. Our attempt to invest in a facility and capability in the US was to first see how we could leverage the very, very large installed base that exists there from a refurbishment perspective, and you set up capability.

The fact is the US market itself, given its federal structure and on the repair maintenance work, requires individual certification and licensing in states. It is a time-consuming process.

It has not contributed in any meaningful manner to our order booking in as far as what we've reported. The exact number is going to be less than 10% of the number that you would have suggested.

The growth that we are anticipating from the aftermarket side as well as new product demand from the US market is high. It just takes a little bit more time.

The US market in terms of finalization of orders, especially on the steam turbine side for areas such as data centers, would take time. It's, as you see as Mani explained also, the first priority would be to go for gas turbines, etc.

As those deliveries have gotten delayed, some of the inquiries that have come up fit very adequately within our product line. Similarly on the refurbishment side, as we get better registrations and we get more visibility with our customers in terms of our capabilities, that builds on itself.

Why don't you add a little bit on this, Prasad, please?

Yes, sir. Basically now two, three areas where the aftermarket wise is one of the strong growth engines for us.

As Mani mentioned that utility area is one of the biggest area across the globe where over the years we invested in our own technology development, and we started working in these opportunities. That is one thing.

Other opportunities where today customers asking us to support them on a gas turbine maintenance, repair, and overhauling sort of a things, this is one more addition which is getting added into our refurb business. As as a refurb business, apart from steam turbines, we support rotating equipment, some of the small compressors also we do that.

These inquiry pipeline is increasing across the globe. Going forward as you are asking next two, three years, as a company, we are very bullish on this because we have all required the market reach is there.

Now we expanded our presence in across the rotating equipment, that is a steam turbines, that is industrial, utility, then we entered into gas turbine space to repair and maintenance sort of a thing, compressors in a small way we are doing that. This is an interesting area to watch for us.

I can mention that way.

Got it, Prasad. Maybe then, mostly SADCs, what is driven the after-sales, I can maybe conclude with what Nikhil also mentioned.

Second and last question, Nikhil, is broadly in FY '27, '28, how much of investment-led loss will be there in US, and if Prasad can help us to understand by '27, '28, is '28 the year where we can be very well utilized in the American facility? That's it.

Thank you.

Of course utilization of the US facility depends on the order booking. While we're optimistic on growth in the order booking both in the aftermarket and the product side, the product would only get executed in possibly in FY '28.

When we look at this current year, the utilization of the facility will be adequate. It will obviously not be at a high utilization level.

We look at the entity breaking even for sure. As you would imagine, even in this first Q1, we've got a substantial loss in the US subsidiary operations, but that was again as anticipated because the order book didn't exist.

Prasad, do you want to add anything on the US operations? Sir,

as you rightly mentioned that, since the product side will be supporting from India, this is only from refurb side. We are quite optimistic this year should be the break-even year by seeing the inquiries, because now the market reach is increasing.

We are also targeting to make this year as a break-even for US.

Thank you, Nikhil and Prasad. I'm good for now.

Thank you.

Thank you for taking my question. The first question is just in terms of the US market.

Typically we see a conversion timeline of inquiries of about 6 to 12 months, but obviously discussed in the past that water permitting takes more time in the US. What's the sense you have in terms of what the conversion of these inquiries would look like compared to our existing business?

As a clarification, our understanding was the steam turbines can be complementary to gas turbines in a combined cycle. Is that understanding right?

Starting with your second question, yes, that's correct. 50% of utility gas turbines that come up in a combined cycle format.

50% come up in a simple cycle format, either due to lack of availability of water or a variety of other constraints. To answer your first question was Can you repeat your first question, please?

Yeah. The first question was that typically the inquiry conversion, as you were discussing in the past, takes somewhere around 12 months.

Yes, yes. For the US market for the US market, Mani, can you answer that question in terms of the US market in specific?

How do you see the inquiry conversion as is anything that you can speak on a broad basis?

Okay. In terms of inquiry conversion in US, what we have observed is it is more than 12 months.

Having said that, we are seeing a lot of traction in this quarter and the next quarter. Once those get materialized, we will announce in the coming quarter.

We see attractions on the product. The first thing in US would be the product would be the one which would get into the market.

Then as we have built the shops and everything, refurb is the one where we are doing the qualifications, we are registering. That is something which would follow the product order booking.

Got it. That's very helpful.

Just a second question is, I know we've discussed this a bit in the call, but on the margins, right? If I back out about 40% of the ₹170 crore 175 crore NTPC order, and if I look at the contribution the domestic makes compared to the past Q1s of FY '25 or '24 perhaps, right, it's been in the range of 46% to 49%.

We still managed in the past to deliver an EBITDA margin of about 20%, and this quarter somewhere around 15%, right? I'm just trying to understand, is this solely because of the bought-out mix being higher, or are there other elements that are affecting margins domestically?

Right? I'm just trying to understand how the margin dipped when the domestic levels seem similar to Q1 of previous years.

About a year ago, you had commodity price increases. At that point in time, we had taken orders as we do take orders based on our execution cycle.

What ends up happening is that there's been no reduction in BOP pricing. As you can see from our execution, certain orders which were taken at lower margin, as each order does has different margins, especially both there's a generic there's a certain broad range of margins that you have in the domestic side, and there's a certain broad range of that you have in the export side as well.

If you look at both of those, I think in general our pricing was lower for products that were executing right now. As we look forward as part of our inquiry book, the order booking margins are substantially higher.

The rupee is also benefiting us. We will have a double whammy going down.

Actually, if you look at even our comprehensive income as part of our reported results, you'd be able to see the difference between the net income and the other comprehensive income, and you'd have an indication as to where margins will go in the future.

Okay. Essentially, Q1 last Sorry, go ahead.

In Q1 last year, we took in margins, I mean took in orders at a certain margin assuming certain commodity prices. As we execute them now, the commodity prices have shot up a bit, so that's squeezing the margin at the moment.

Is that interpretation right?

No, no, no. When we take an order, we take it at fixed margins.

It's taken at a fixed BOP cost. There're certain things which are not fully finalized at the point in time of execution of an order, but broadly, we have an expectation of the margins going in.

Those are the margins that were available at that point in time in negotiation with customers, and so that is what the market was offering at that point in time given our competition. It is a competitive industry at the end of the day.

What we get is what our competitors get. They may have a different margin structure.

We may have a different margin structure. That is what was available.

Each, I said, each individual orders is different and they're taken for different reasons. Certain markets where we have a lower market share, we will price products differently.

In certain markets where we have a higher market share and where we have greater customer acceptability, we would have different margins. They vary quite drastically both in even in the domestic sector as well as export sector.

I don't know if that answers your question fully, but that's the way we view it. Excessive if you're taking the explanations that we have for this current Q1 and extrapolating it to future quarters, the certain BOP orders can be at a higher margin also.

It doesn't necessarily need to be only because of what you suggested.

Understood. Okay.

Thank you.

Yeah. Thanks, Nikhil, for taking my question.

The first question, Nikhil, is, if you think about last two years, right, there have been one event or the other which has, in a way disrupted our usual business, to say. This quarter, it was freight.

Last quarter or last year, there was this domestic geopolitical issue which led to customers not able to do the audit part of it, right? Before that, if we think about the, three, four years before that, it there was a very smooth sailing, to say.

What are we doing, right? You do just to ensure that, this volatility in the business, because this factors which are geopolitical, which are not in our hand, seems to be occurring more often than not.

How do we ensure that the volatility in our business, assuming that geopolitics will remain where it is, the volatility comes down?

I think the only way to overcome that is by order booking. When you have a large enough order book is the only way that you can smooth out any volatility that happens, both in terms of customer delays as well as any other geopolitical situation.

The fact that we are trying to expand our product range to be able to cater to a variety of different demand structures hopefully will lead us to building that order book, which allows us to have that comfort. I think that that's the only way to actually, as a company, to weather these interruptions that are causing these geopolitical interruptions that are causing sort of volatility in both our execution as well as order booking.

Yeah. Thank you, Nikhil.

Secondly, on the US, specifically the data center inquiry and the small modular reactor inquiry, now in the combined cycle, where there is an opportunity for us, do I think someone on the call mentioned that you are expecting an inquiry to get converted into order sometime in this year. Just wanted to understand, in terms of product approvals, are the approvals in place?

How is combination how is the competition, right, in the combined cycle? Also on small modular reactor, there also do we see some traction happening this year in terms of inquiry flowing down to order book?

Firstly, on the competition in the combined cycle, of course there's competition. This is a competitive space, though there aren't many manufacturers.

We only include inquiries in our inquiry book where we are qualified, otherwise the inquiry would not be given to us by a customer. We're talking about orders where we are quoting and where we're engaging with customers.

Now, Prasad, maybe you can just add a little bit onto the competitiveness as was alluded to and how we see the market developing this current year, especially in the US?

Yeah. US, two ways what we are seeing is, one is, as mentioned, we are qualified by all the consultants and OEMs and EPCs.

That's the reason why they're giving the inquiries. Now what we are seeing is, as Mani also mentioned that, now today gas turbine delivery cycles are quite long delivery cycles.

Now they want the power. What people also doing is now starting the bottoming cycle, that means using a steam turbine, firing the gas in a gas-fired boilers, and start generating the power.

This traction is increasing. This is a space where we can play a bigger role.

Competition-wise, across the globe, we compete with the same players across the globe. We are competitive in rest of the world.

Obviously, we'll be competitive in America. Over and above, the local presence with our workshop gives the confidence to the customers.

This is a narrative on which we are building, and we are bringing the confidence to the customers. The inquiry pipeline is started building up.

As Mani mentioned that, we are quite optimistic, and in some cases, we are quite closer to the final commercial discussion sort of a thing. This year should be a little positive results we are expecting on the product sales side, and followed by refurb and overhauling opportunities.

Can you also touch upon the SMR, small modular reactor? Where are we similarly in the journey?

That'd be a very long Yeah, Prasad, please go. Sir,

these are the long gestation periods because these are technological, we are working with some of those EPCs and developers sort of a thing. These are at inquiry stage.

We are working very closely with them. It may take a little more time because this is from concept, the first of its kinds.

Now somebody has to come with a module in such a way, that is the movable modules sort of a thing, the concept what in US people are working. We are working with various developers very closely by finding the right configuration on that.

It may take a little time compared to the combined cycle applications for data centers.

Thank you so much, and all the very best.

Thank you. Thank you.

Thank you so much for the opportunity. Sir, my first question is you mentioned that the execution cycle is quite long for these large projects.

If you could just tell me what is the execution cycle?

It depends on order to order and scope. It's very difficult to determine that, but in general, smaller orders less than 15 MW is maybe 7, 8 months; 15 to 15 to 45 MW is about 9 to 9 to 12 months; 30 to 45 MW is probably about 14, 15 months; and maybe 18 months for 100 MW.

Sir. Sir, next question is what is the conversion rate for us pipeline to order book, approx?

It's not something that actually comes out. The pipeline to order booking is dependent on the market.

The only way that we measure it is through market share, which we report on an annual basis.

Sir. Thank you.

Yeah. Hi, sir.

First question is on the CO2 BESS. I think earlier in the call, you had said that has been some validation in Europe.

Just wanted to understand how has been the response there in terms of round-trip efficiency versus the BESS, and do you think that similar kind of success can be replicated in India and whether it will turn into larger inquiries and ordering for you?

No, of course the attempt is for us to validate technology so that we can drive more demand. We would not have picked it if the round-trip efficiency and the lifecycle cost were not competitive enough.

The indications of the plant and its performance in Europe is very good, and something that's appreciated by the customer. Now we have to prove it.

That's

Do we have any exclusivity with Energy Dome in terms of technology, or it's open for all? What leverage do we have by taking this pilot in India?

No, we have a very strong relationship with our technical partner. The nature of the relationship is something I'm not willing to discuss on the call.

The fact is that we're committed to the market to approach it jointly.

Second question is on the up to 100 MW. Now I think NTPC is talking about coming up with maybe smaller subcritical kind of packages up to 250 MW.

Do you think that if such opportunity does arise, we is able to bid, or we're to that megawattage level? No,

of course, we have the capability to manufacture to that level. Will we participate or not, I think it's something that we'll see.

Prasad, do you want to add anything on this point?

Sir, in this range, yes, that's what I want to say that we are qualified for that, but just we have to wait and see because the request for quotations, those qualification guidelines, we are qualified for that. We have to wait and watch how these things will move further.

Just the last question, sir, on this CO2 BESS again. This validation you said will happen, maybe the completion happens in Q2 or part of early part of Q3.

Once how much time the validation takes, and when do we see more orders or more tenders coming in for this in the future?

I think the question is a little premature. This is also a first-of-a-time first-of-a-kind project that we're doing.

When we can actually establish validation of technology is something that I think is a little premature for us to determine both on timelines. Secondly, in terms of generation of demand, we'll have to wait and see what happens post-validation.

We're

optimistic that this presents a market.

Okay. Done, sir.

Thank you.

Thank you very much.

Thank you very much, ladies and gentlemen, for joining the call for Q1 FY '27 for Triveni Turbine. I realize that maybe all questions could not be answered.

Please do take it up with Shreya, and we'd be sure to get all the answers to all of you. Again, the quarter was a challenging quarter.

We're very optimistic again as we have explained on the call about the full-year performance, which will be back-ended again as it was last year. Quarter on quarter, there will be volatility.

There continues to be geopolitical uncertainty, but we aim to power through that given the diversified nature of our reach and our local presence in certain markets, which allows us to have for our size of company and to have a good export exposure and to keep pushing our global market share, which is a key driver of what the company aims to achieve over the coming years. Thank you very much.