Gabion Technologies India Ltd

MS. DHRUVI – EQUIBRIDGEX ADVISORS PRIVATE LIMITED

Please note that this conference is being recorded. I now hand the conference over to Ms.

Dhruvi from EquiBridgeX Advisors Private Limited. Thank you and over to you, ma'am.

Welcome to the H2-FY26 earnings call of Gabion Technologies India Limited. From management team, we have with us Mr. Madhusudan Sarda, Chairman and Managing Director. The call will begin with opening remarks from the management, after which we will open the floor for Q&A.

With that, I would now like to hand over the call to management for opening remarks. Thank you and over to you, sir.

Thank you. Good afternoon, everyone, and thank you for joining Gabion Technologies India Limited's H2 FY26 earnings call. Especially warm welcome to all our investors, analysts, and stakeholders joining us today, and I take this opportunity to sincerely thank all our shareholders and stakeholders for their continued trust and support in our journey.

Gabion Technologies India Limited continues to focus on delivering integrated engineering and geotechnical infrastructure solutions across roads, railways, water resources, energy, and other infrastructure sectors. Over the years, we have built strong capabilities across manufacturing, design, and EGC execution, enabling us to provide end-to-end customized solutions for complex infrastructure requirements. During FY26, we continued strengthening our operational capabilities, enhancing execution efficiency, and expanding our presence across domestic and international markets.

Our integrated business model supported by in-house manufacturing technical expertise and EGC execution capabilities has enabled us to consistently deliver cost-efficient and high- quality solutions across projects. Today, we have established a strong Pan-India presence across 29 states, along with our manufacturing unit in Nepal. Our diversified product portfolio includes Gabions, slope drapery nettings, geogrids, rockfall protection systems, 3D polymer mats, and various other geosynthetics, and these continue to support our long-term growth strategy.

We have a high-capacity utilization of around 80%, supported by more than 170 old machineries and strong project execution capabilities, further strengthening our operational performance during the year. Coming to the financial performance, FY26 has been a steady and encouraging year for us across three financial parameters.

For FY26, total income stood at INR115.58 crores, registering a growth of 14.15% year-on- year. EBITDA for the year increased to INR17.79 crores from INR15.37 crores, reflecting a growth of 15.75%. Net profit grew to INR8.11 crores compared to INR6.19 crores in FY25,

registering a strong growth of 31.04%. Our H2 FY26 performance was particularly encouraging.

Total income for H2 FY26 stood at INR74.87 crores, as against INR57.84 crores in H2 FY25, registering a growth of 29.44%. EBITDA increased to INR11.91 crores, reflecting a strong growth of 72.09%, while EBITDA margins improved to 15.91%. Net profit for the half-year stood at INR5.69 crores, registering a strong growth of 62.53%.

Net profit margins improved to 7.60%. Our integrated business model and diversified project exposure continued to support healthy operational performances during the year. We also witnessed increasing opportunities across infrastructure development, slope stabilization, erosion control, and geotechnical protection projects across India and international markets.

Our current order book stood at approximately INR200 crores, which provides strong revenue visibility for the coming period and reflects continued customer confidence and deep business momentum.

Going forward, we remain focused on strengthening our execution capabilities and operational efficiencies, expanding our product portfolio, and capitalizing on opportunities arising from increasing investments in infrastructure, transportation, water management, and energy sectors.

Before we begin the discussion, I would like to thank our employees, customers, business partners, and shareholders for their continued trust and support. With that, I now hand over the call for further discussion and questions and answers.

Thank you very much. We will now begin the question-and-answer session. Our first question comes from the line of Nishita Shanklesha with Sapphire Capital. Please go ahead.

Yes, hello. Thank you for taking my questions. I had a few questions. So, one is on the revenue growth we've done of around 14% for the whole year. Earlier in the IPO call, you mentioned that we could grow at around 20%-25% for the year FY26. So, I just wanted to know what was the difficulty in achieving this 20%-25% growth?

There is a work in progress in our project amounting to approximately INR15 crores, which could not get built during the financial year. So, that revenue loss has resulted in this muted growth from our estimated 20% to around 15%.

Okay. So, is this INR15 crores also included in the current order book?

No, this is not included in the current order book. Yes, this is not included because this is almost complete on the site. So, we have not included it in the current order book.

Okay, understood. And you earlier have also mentioned that in FY27, we can do a growth of 30%-35%. Is that still achievable? Is that something we're still targeting? And if so, how are we going to achieve that growth?

Okay, understood. And my next question would be on the order execution time. So, this INR200 crores of order book, what is the execution timeline for that? And how much of it can we do in FY27?

The current INR200 crores is all to be completed within this financial year because the orders that we have in hand are either going at a good pace, execution, or if there are new orders, then also the plan is to execute them at a fast pace and complete it. So, we are expecting the INR200 crores, yes.

So, then we should have the top line of more than INR200 crores, right? Because you mentioned that INR200 crores from that INR100 crores will be from sales. And right now, you're mentioning that the order book of INR200 crores will be able to execute. I'm assuming the order book is just for project and not product also, right?

This is including product. The current order book is including the product because we have got some major orders from various products for various buyers, including government and private. So, this is including that also. And it includes production from our existing liquid customers also.

Okay. So, what is the bifurcation if you could get from the current order book? How much is project and how much is product? 50% is product and 50% is project.

Okay. Okay. Understood. And what would be the margin profile in both project and product be like?

The margin profile will be slightly better than the last year. We can also scale from a larger turnover and expecting 1 or 2 percentage points higher margin this year.

Okay. Okay. Understood. And what is the order pipeline looking like? If we have any order pipeline?

The order pipeline, we are still only in May and we are continuously going to be booking new orders and they are going to spill over to the next financial year. So, next financial year, I mean, the order booking for the current financial year so far, we have booked order of INR44 crores already.

So, with this momentum, we are likely to book a large number of large orders and which will spill over to the execution, will spill over to the next financial year. So, in the next financial year, we are expecting turnover of more than INR300 crores.

Okay. Okay. Understood. And like, if you could give some color on the capex that we've done in FY26 and that we plan to do in FY27?

The capex in '26, we have done around INR4 crores of capex we have done, which has been from our own internal accrual as well as bank loan. And there is a further capex ongoing of INR2 crores, which is again, which the machineries are ready and are on the way actually to be set up. And buildings are also under construction. So, all these have been through our own accruals and through bank loan that we had obtained last year.

There is one capex that we are going to do from the IPO proceeds and that also the equipment machinery has been finalized. And that will be purchased after some more due diligence on the part of the technical parameters of the machines. So, after that, that will also come to our production facility. So, then our production will become 18,000 metric tons by September 2026.

Okay. So, like the capex for this new machinery that we're going to do from IPO proceeds, that will happen in the financial year of '27, right? Or we've already done that capex?

Already capex is done. So, already our production capacity currently is 12,000 and 3,000 metric tons of machinery already is on the way. So, 15,000 will be there and then 18,000, our capacity will become 18,000 by September 2026. And this last batch of machines will be purchased by the proceeds from IPO, which we had allocated for this.

Right. So, that would amount up to what price? Are you asking the value of the capex? Yes.

Yes. So, the total capex since last year would be approximately INR8 crores. Okay.

After which only INR1 crores is from the IPO proceeds.

Okay. So, that is the total capex in FY26 and FY27 included, right?

Included, yes. For the part of our production capacity increment in 2019, our primary products, gradients and nettings, etcetera, which are already being manufactured. Now, we also have some plans which we are working on for new products. So, that is neutralized, that will become extra.

Okay. Okay. Understood. Thank you so much. I'll join the queue if I have any more questions. Thank you.

Thank you. Our next question is from the line of Madhur Rathi with Counter Cyclical Investments. Please go ahead.

So, Mr. Sarda, I wanted to understand that out of our INR115 crores revenue, what is the bifurcation between manufacturing and how much is the EPC part of the business?

It is approximately 60% each at this time. You mean INR60 crores each? 50%. So, 50 service is exactly, if I have to say, it's around INR54 crores is the service in this financial area.

Okay. Service is basically the installation and EPC is what we call service?

Yes. Service we call the project execution is what we call service.

Okay. And the rest is our own manufacturing and whatever we are manufacturing, we are basically consuming ourselves or we are selling to outside external parties also?

Now, when we sell it directly to outside parties, we call it product sale. And when we consume it in our own projects, that becomes a service sale. Because that is built only after installation.

Understood. So, basically 46% of INR115 crores is external sales for us. External sale of products? Yes. External sale of products. Exactly.

Understood. Now, Mr. Sarda, what is our market share approximately in this Gabion industry? Gabion industry?

Market share, I think, would be around 20% at the moment, 20% to 25%.

And who would be the other major players in this segment?

There are some factories, like there is a factory called Secure Matrix in Maharashtra. There is a company called Techfire. And there are some smaller players, but one or two major players are there who are competing with us.

Okay. So, all are unlisted. There is no major player like Afcons or L&T or anybody who is in this segment?

No, not in the manufacturing segment. The company names that we have taken, they are large construction companies. However, we do specialized work for these companies also. So, our business of the service business comprises also of specialized structures that we build for companies like Afcons and L&T.

Understood. And Mr. Sarda, what is the water part of the business?

The water part basically is flood protection. So, flood protection structures are required and it's also called river training. So, preventing flooding of rivers, that is a part. And there is a project going on in Manipur in Fall River, which is flowing through the city. That flood protection work we are doing currently. So, that is the water part.

Understood. And basically, is it fair to say that whatever service income is there, it is all tender business?

No, our service business is tender. Tender is for the government projects that we are able to win. Those are two tenders. But we have other private companies like Afcons, L&T, many companies like these, for whom we do specialized work. So, that provides us a stream of service which is not dependent upon tendering. But it's dependent upon our relationships with them and our capabilities, which continue to support their own work.

So, Mr. Sarda, what was the reason for flattish revenues for the past three years, FY24 '25, '26?

I guess it was the organizational capacities that needed to expand was not achieved during those years. Because as our projects were growing and as our business was growing, then the required resources were not there. It took time for us to build the required resources. So, now, we have built a lot of fleet of machineries.

We have built our factories. We have put up a new factory in Assam. So, we have now built up the required infrastructure to be able to drive the business that we need to do. We have similarly built our number of engineers that are required. So, that has taken some time over the last few years. If you look before that, a couple of years before that, we have had good growth.

We started from around INR30 crores. Some five years back, then we went to INR60 crores, then we went to INR80 crores, then we went to INR100 crores. And there has been some stagnation at this point. But next year, coming year, we are looking at INR200 crores.

And what about the EBITDA margin that we can expect going forward from FY27 onwards?

We are expecting a 0.1% or up to 2% increase increment in the coming year owing to the economies of scale that we are going to generate in this year.

Understood. And what about our debt? I mean, after the IPO, it doesn't seem that debt has gone down. So, in FY27, any plans to repay some part of the debt? And what is the interest cost outgo? Like it was INR5 crores for FY26. So, what is it expected to be for FY27?

Actually, our debt equity ratio has become very less now. Around 0.7 is our debt equity ratio.

And the finance cost this year has been INR4.7 crores. And we expect it to be around this level only. So, we don't expect an increase in our finance costs.

Okay, understood. So, this margin improvement that we have seen from 12% in FY24 to 15% this year, is it majorly driven by the service portion increasing from 34%-35% to 45% currently? Is that understanding, correct?

Yes, this year, it has been driven by the increase in the services business where we enjoy a higher margin compared with manufacturing. Although in the coming year, I have to just update you that we are going to become -- the new expansion that we are doing is bringing advanced technology to our manufacturing which is going to decrease our cost and our manufacturing margin is going to improve in the coming years.

Right. So, how much higher is service margin versus the manufacturing margin if you could give me the difference between both of these?

The margin in services is approximately 10% higher than just in the manufacturing field.

Got it. So, it would be closer to 20% versus 10% for the product business? Yes, yes, that's correct.

Got it. Now, sir, coming out to our working capital, sir, how is the working capital cycle for the product part of the business and how is the working capital cycle for our service part of business in that, if you could help us understand, do we get the 45-day MSME treatment for our private sector customers and how is it for the government customers?

Yes, as far as the 45-day treatment is concerned, still a lot of companies are not honoring that as much as it should be. There are a few companies like Vedanta, the biggest, the best companies, they are honoring that, but some of the other privates are not yet into that, but hopefully, they will follow it. I mean, there is some improvement and owing to that, we will be able to manage our product sale within 45 days turnover, working capital cycle.

Sir, how is the working capital for the product business that we sell to other people in the industry?

You are asking for comparison with other companies?

No, sir, no, sir, for us, I'm asking how, so for the whatever products, Gabion products that we sell, what is the working capital cycle that we follow? It's around the 45 to 60 days. 45 to 50 days for the products and what would it be for service? For service, it's around 60 to 70 days. 60 to 70 days, but sir, if I look at our FY26 year-end, our working capital was closer to INR65 crores on a revenue of INR110 crores, so that is not matching, that's why I was asking for the bifurcation, because it is like closer to 180 days, but 45, 50 days for product and 60 days for the service, it doesn't match, so where is this gap coming out from?

Actually, there is a work in progress in the inventory of around INR15 crores, that is not, that I'm not counting as part of the current, I mean, in this, in my assessment of the number of days,

because the projects, work in progress, that is the INR15 crores is the amount which basically is like an unbilled revenue.

So that I'm not counting as part of the, in the working capital cycle, and then there are cash, cash, INR5 crores cash is there, and there is retention money, INR6 crores, there are items in the current assets, which are not actually from the operation part, which can be, so I'm giving you a modified figure actually.

Got it sir, got it sir, I think that clears my doubt. Sir, so how should we look at this industry going forward in terms of applications as well as the demand going forward, maybe over the next 2 to 3 years, how should we look at this industry going forward?

This is a very high growth industry and very, it's a very promising industry because it brings technology to traditional, to construction, basically our business is about bringing new technologies and making construction more cost effective and better quality wise. So that, that is always, that is the need of the hour at this time.

And our specialized services like landslide sterilization, landslide protection mitigation, flood control, all these are also now very much in the awareness of the government and there is a big push to achieve these goals. So, it is a very pertinent business for this time.

Right, so this is a final question from my end. Sir, what, what differentiates one Gabion supplier to the other? Because if I look at your website, some of these products are fairly commoditized, but some of them are very, I would say, some of them are specialized in nature or very application oriented. So if you could help us understand what differentiates us from our competitors and what would be our right to win going forward across tenders and across the product segment?

So, we are not just a manufacturer. We are an integrated solution provider. We have a very high level of, we have a high, high design expertise. We are on the forefront of technology. We are working with authorities to all designs of structures and our specialization means that we get preference over our competitors. And also, our execution of product execution capability means that we are a one in all solution providers.

So once a customer joins with us, then they can be assured of a full end-to-end service and can be assured that their work is going to be completed on time and with quality and which other manufacturers are not able to do. And plus, apart from the commoditized products, we also have specialized products like, like our 3D erosion control mats, which we are the sole manufacturer in India at this time. So, we keep expanding our product portfolio.

So that way, you know, of course you have to be in the, in the commodity section of the business also because that will drive up the volume. And without that, you cannot have a reach of the market. So, but the business and the margins are earned through specialized services and specialized products.

So, so in the service segment or where we, we are more application oriented is the work that we provide at the start of the EPC business, where, how these Gabion really pleased, that will

be dependent on. So, whatever we submit to the plans. So, if you could help us understand what is the flow, where do we exactly come in, in the EPC or the service business part? Yes.

So, what happens is that these are, basically these are, these are protection structures. For example, if a road is being built, then you need to, if there is a hill cutting there, then you need to stabilize that hill. So, we come into the picture as soon as the need arises for the stabilization of the hill.

Then our survey, our design team will take up the exercise of checking all the, at the site, all the parameters. And then we suggest the design, we prepare a design, which is technically capable of stabilizing the structure. Then from that, the BOQ will be derived about what materials will be required and what quantities, etcetera.

And accordingly, then the order will be placed. And if the customer requires installation, we do the installation also. So, in fact, most customers ask us to do the installation ourselves, because we have a large sheet of machinery. We have the expertise, we have the expert team, which, which the customer needs to complete his work on time.

Got it. So, sorry for extending. So just one final questions are out of this INR200 crores order book, how much is coming from new, whatever project, the 50%, the INR100 crores project what we have currently, how much is coming from new projects versus older projects where there is need for additional safety requirements and where we'll be going, supplying these products, how much is from new and how much is from the older?

In this INR100 crores, approx 50% is from ongoing projects, which were ongoing, let's say halfway through last year, but they're still ongoing, they're not finished. And INR50 crores are projects which are newish, I mean, just started or just about to start. So that is the bifurcation between the, in the order book, between the, we can say substantially completed projects and relatively new projects.

So, Mr. Sharda, what is our total manufacturing capacity, if you operate at full capacity utilization, then what is the revenue we can generate from the manufacturing side of the business itself?

We are in the process of making a production capacity of 18,000 tons. So, 18,000 tons will give us a turnover of INR180 crores.

INR180 crores only from the manufacturing, no service component?

We're in the process, so last year we started at 9,000, then we became 12,000 currently, then some of our new machineries are being installed, so that will make us 15,000 and by September we'll become 18,000, the capacity. That will translate to approximately INR200 crores of just sale of product.

INR200 crores. And last year we did roughly INR50 crores-INR53 crores of manufacturing revenue, right?

Yes.

But in the service part also, some of our manufacturing would have got capitally consumed? Yes, that's true.

So, basically what was the total manufacturing output in terms of tonnage in FY26?

It was around 8,000 tons and that was around, so that will be around INR75 crores of product value. So, around INR25 crores out of that was consumed in our own products.

Understood. So, now this 8,000 tons can, by September the capacity will go up to 18,000 tons and then ramp up. By when do you foresee us reaching 18,000 tons of volume?

Now, Mr. Sarda, since FY24, if we see our revenues are flattish, but the inventory has gone up from INR13 crores to INR35 crores, like it's tripled and receivables have doubled from INR21 crores to INR43 crores, whereas the payables are basically flat at INR22 crores versus INR18 crores.

So, basically despite revenues being flattish in past two years, the working capital has gone up dramatically, like it has more than doubled. So, now going forward, what is the steady state working capital days in your business? Typically, how much inventory do we keep in terms of inventory days? What is the credit period that we offer to our customers? And, what is the payables that we have? How much do we pay our suppliers? What are the payable days?

So, this year we have a INR15 crores working progress in our project, which has been added to the, which has got added to the inventory. So, that is the major reason why you are seeing inventory increase so much. And then there is a retention money INR6 crores in the current, not in the inventory, in the current asset.

So, when we are talking about the inventory, the major reason of the increment we are seeing is because there is a INR15 crores working progress of projects, which is basically unpaid revenue, which is because the work was substantially completed, but not fully completed, so we couldn't build it. Or because the customer couldn't get around to do their measurements and certify all this, so we could not build that. So, that is why the inventory is showing elevated.

And then the trade issues also is because our sale has, in the last quarter, we have had around INR50 crores of sale last quarter. So, that is why the receivable is issuing at an elevated level at this time. But you can, going forward into 2026, we are expecting this same level of sales receivables, because our quarterly turnover is expected to be on average INR50 crores. So, the sales receivables will be around INR40 crores.

Yes. Okay. So, basically, now in FY27, the working capital will not increase despite the sales almost doubling. Yes. That's correct.

Okay. Now, Mr. Sarda, how many steps does our manufacturing process take? I mean, is it a one step, two step, like how many steps? And what is the starting raw material that we use?

Please. There are a number of steps. And the raw materials that we use is GI wire, which is Galvanized Iron wire. And we use polymer granules. So, with these two raw materials, we produce our products. These are our major raw materials.

And there are various steps in the production process, which, first of all, is the coating of the wire. The wire has to be coated with polymer to make it corrosion resistant. And then there is weaving of the wire into a mesh.

That is basically like forming a cloth of steel wire. And then there is another process in some of the products where there is a coating, not a coating, but a polymer mesh, which is integrated into the steel wire mesh, which provides it erosion control capability. So, that is one part of the process, one product line process.

In another product, after the steel wire mesh is made, there is a process in which the base of the box is created. And then the panels are fitted on the boxes. And then packing and fabrication is done. So, these are the steps in the gauging boxes. And plus there are many different specifications that we are making. So, there is a lot of management required in the production planning. So, I understood that… Sorry to interrupt, Madhur. We request you to please return to the queue if you have any further questions. Thank you. Our next question is from the line of Durgesh with Finmart Services. Please go ahead.

Yes, thank you so much for the opportunity and good afternoon everyone. Am I audible? You are audible, sir. You may proceed.

Yes, yes. Thank you. Yes. So, I have several questions, actually. So, first one is to see your FY26 revenue, 0% by 29% almost. And while EBITDA increased by almost 70%. So, what were the key drivers behind this strong operating leverage? And is this margin profile sustainable going forward in this year and the upcoming years as well?

Sorry, I couldn't hear you properly. I think you're asking about the H2, second half of the year? Yes, correct. Correct.

Yes. So, second half, we had a good period…

Sir, EBITDA actually grew by 70%. So, I'm asking that, so what were the key drivers behind this strong operating leverage? And is this margin profile sustainable going forward in current FY27 and upcoming years as well? So, that was my question, actually.

Okay. So, the margin profile going forward is sustainable. We have a business model which has been honed and developed over the last few years. We are, our business is, the driving force of our business is our technical capability, which our customers do not have within their own organization. So, we bring in the expertise they require to complete their projects. So, on time.

And we have the execution capabilities to do the, to execute the parts of the project, which they themselves are not specializing. So, with this business model, we are able to sustain the margins and increase our business. And the infrastructure requirement is also now to make it sustainable and make it safer.

So, our work is protecting the infrastructure, like preventing landslides, preventing floods. So, this part of the business, this part of the infrastructure is now being recognized by the government also, and it is, there is a thrust on it, which is not present earlier. So, that is why we are able to sustain the margin and grow the business over the next many years.

Okay. Thank you, sir. And actually, yes, okay. I got it. And this was mainly about the margin profile sustainability. And sir, what about the key drivers? Any specific or any special key drivers that you would like to mention?

I couldn't catch that. Sorry. I couldn't understand what you're saying. What is the question?

No, no. Yes, my question is, what were the key drivers specifically behind this strong operating leverage? Key drivers?

Key drivers. See, as I said, our business is, the key driver of our business is our design capability. With our design capability, we are able to provide a very high value-add to our customers. We are able to save them money. We are able to, and also, along with our design capability, our execution capability, and our specialized products.

We are manufacturing certain key products, which are very essential to our customers, essential for them to be able to build the structure properly. And our execution capability also ensures that their work is completed on time. Otherwise, they will face many penalties from the authorities.

Okay, sir. Thank you. And another question regarding PAT. So, in FY26, the revenue growth was almost modest at around 14%. And PAT grew by almost 30%, 31%. So, can the management please elaborate on the initiatives that led to this higher profitability growth, PAT-wise?

Yes, PAT was because, see, our PAT was, I mean, relatively modest last year. And also, so that's why increment looks big, because it was relatively modest last year. But we are then

looking to sustain this and grow this by another 1 or 2 percentage points in the next couple of years.

Okay. And so, which business particular of yours that is manufacturing, trading, or services vertical contributed the most to the revenue growth during FY26? And how do you see this mix evolving over the next couple of years as well, two to three years, say?

I think your question is pertaining to our manufacturing and, like, where is the thrust area. So, I would like to tell you that it is going hand in hand. So, basically, you know, because our manufacturing, a lot of the products, a lot of the services that we provide use our own products. So, they are going hand in hand. So, we are, and that is also a key reason for our growth also, because we are able to… Actually, yes, sorry to interrupt, sir. Actually, my question is regarding the growth contribution during FY26. As in, which of these verticals contributed highest to the growth, manufacturing, trading, services, verticals?

In FY26, it was the service. The services was the growth, mostly the growth, because the manufacturing, our capacity was already at a high utilization. I mean, it took time for us. It is taking, it took time, and this year, it will translate, the product will also increase, the manufacturing.

Okay. And how do you see this mix evolving over the next couple of years, three, four years as well, three to four years, upcoming?

Yes. So, upcoming three, four years, we are, our momentum of growth will keep growing like INR200 crores, INR300 crores, INR500 crores, we are going to go. And then, we do aim to become a big project, big construction company, which can take big projects, you know, INR500 crores, INR1000 crores, like that, and all that number. So, from there, we can go to become a key construction company in the country.

Okay. Okay. Last couple of questions, sir. What percentage of the current order book is expected to be executed during FY27? Any specific numbers?

Most of the, almost 90% will be completed this year only, because the order book, now, the new projects we are getting, we are going to complete, we are now planning to complete all of them quickly. So, and the past orders is also complete. And we are continuously booking new orders also. So, which will become our mainstay for the next, next financial year.

Sorry to interrupt, I request you to please rejoin the queue for further questions.

Okay. Thank you so much for the information. Thank you.

Our next question is from the line of Manan Jariwala, an Individual Investor. Please go ahead.

Hello, congratulations on the good set of results. So, I wanted to understand about the tax treatment that we are doing. So, if I see the results, so we did not charge any tax in the first half of the year, and charge the full year tax only in the second half. Whereas in the previous

year, we didn't charge any tax in the second half, that is half two FY25. So, could you just clarify the tax treatment we are doing… Okay, you're talking about the comparison, because the tax, you mean the income tax computation is done at the year end. So, that's why it is shown at that time only. I mean, I mean, we could show it. But that, that is how the accounting normally is actually, that the tax is shown only in the, not in the first half year balance sheet, it is shown in the full year only.

That is the treatment that auditors are giving for the income tax part.

Okay. And one more thing, could you clarify regarding the INR300 crores revenue guidance that you gave? Was that for the running year FY27 or for the next year FY28?

I couldn't understand that question. Can you repeat please?

The INR300 crores revenue guidance, which you gave earlier, was that for this year FY27 or for the next year? That was for FY28.

FY28. Okay. Okay. I'll, I'll jump back in the queue. Thank you.

Thank you. Our next question is from the line of Madhur Rathi with Counter Cyclical Investments. Please go ahead.

Sir, if you could help us understand what is the impact of steel prices on our products, and have you taken any prices during this year?

So, they cannot stop their production once they are into it. It becomes very costly if they have to stop their production. So, if they have a big customer giving a big, large order, they will book it and keep, and then they will do that backward purchase.

So, that is how we do it. We book a large order to them. So, by the time if there is a price fluctuation, we are able to again change our finished material prices. So, that is how we insulate ourselves from the fluctuations.

Okay. And just one, sir, are there any export opportunities for our products or that is too far- fetched right now?

There are lots of export opportunities. Actually, our capacity is, we are not able to meet the demand, domestic demand without capacity. As I said, we are increasing, we are doubling our capacity currently, and that also might not be able to suffice the domestic demand. So, we will take a call how to go about catering to the export market because there is an export market. So, it is in the pipeline, but currently our capacity is constrained for that.

Got it. Sir, do we also manufacture geotextiles or geotextiles is a bought-out item for us?

Geotextiles is a bought-out item. Geotextiles, we do not manufacture, but we do manufacture one type of geogrid. There are many types of geogrid. We manufacture one type of geogrid.

The other types of geogrids are bought-out items, but geotextiles, we are not manufacturing at this time.

Got it. Sir, just a final question. Sir, there is a company called SRM Contractors, and they are into slope stabilization work. So, are we a supplier? So, would we be a supplier to them or these guys who are like a INR1000 crores, INR2000 crores company, they have in-house production capacity?

The SRM Contractors took over one company called [Mecaferi 0:53:18], which was a manufacturer of these products, but that company's manufacturing is not going too well. So, they are relying upon other suppliers, and we are a major supplier to SRM. And also, but at the same time, we are even competing with them in projects. Okay.

Got it, sir. That is from my -- sir, just one. Sir, so now, in our manufacturing, our external sales part of the revenue, do we have dealers and distributors, or we directly deal with the customers?

We directly deal with the customers. We do not believe in having a line of -- another line of people, because they will not be able to technically understand the requirements of the customer. So, we have our own regional marketing team, who are qualified engineers, and they are able to cater to the requirements and guide the customer properly, and then that is how we add value to our business.

They will have an impact, but we insulate ourselves by booking large quantities, so that at any given time, we have a pipeline of supplies coming in at a rate which we have already entered in our sale prices. So, that is how we insulate ourselves from this. I mean, for example, the Iran war time, the polymer prices doubled basically, but we had a good booking of quantities with our suppliers. So, we did not have to bear the hit as much as otherwise.

Okay. So, now, this INR200 crores revenue that we are expecting in FY27, the order book that is there, for that, already the raw material has been booked at the same rate at which the order was taken?

No, that's far we cannot go. Maximum we can go is up to three months of our sale or production.

No, so, Mr. Sarda, now, you are expecting operating margin to increase by, let's say, 1 to 2 percentage point this year. Now, that is only possible if we are able to pass on the drastic increase in steel and polymer prices. So, now, this INR200 crores of order book that is already

there. It is already behind us. So, what I'm trying to understand that at current raw material prices, if we execute those INR200 crores worth of orders, then will we be able to get 15%- 16% EBITDA margin?

So, as far as the project orders that are concerned, that those we are, as I told you, that we are going to finish them quickly. So, that we remain insulated with the fluctuation of prices. And as far as the product sale part is concerned, there is a scope for renegotiation of prices if there are drastic. For example, during the Iran war, we had to renegotiate prices with some of the customers.

And customers also understand that if something becomes unfeasible or like force majeure conditions, even in contracts, there are force majeure clauses. So, that insulates us and we can renegotiate the prices. However, the major strategy for us is to complete our execute quickly and to insulate ourselves from this kind of fluctuation.

Understood. And what is the average order execution period? Like, let us say we get an order today. So, firstly, in terms of manufacturing, how much typically time it takes? And if there is a service component also, then how much further time it will take approximately?

The manufacturing part will be within one month. One month is a typical period in which we complete an order. But sometimes there are larger orders than that can go on up to three months, four months also. And for project, it will take around six months to nine months for execution.

What we do is that we produce the materials that are required and ship it to the site. So, we maintain a slightly higher level of inventory to control the costs from insulating ourselves from the fluctuation.

Okay, Mr. Sarda. Thanks a lot. Best of luck. Thank you.

Thank you. We have no further questions, ladies and gentlemen. I would now like to hand the conference over to Ms. Dhruvi for closing comments. Over to you, ma'am.

On behalf of Gabion Technologies India Limited and EquiBridgeX Advisors, I would like to thank everyone for taking the time to join today's conference. Should you have any further queries, please feel free to connect with us at info@equibridgex.com.

Thank you. On behalf of EquiBridgeX Advisors Private Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.