Capacit’e Infraprojects Limited (NSE: CAPACITE) Q2 2025 Earnings Call dated Nov. 18, 2024
Corporate Participants:
Rohit Katyal — Executive Chairman
Rajesh Das — Chief Financial Officer
Analysts:
Nirvana Laha — Analyst
Aditi N — Analyst
Parvez Qazi — Analyst
Ram — Analyst
Rajesh Jain — Analyst
Akshat — Analyst
Akshit Mehta — Analyst
Dhananjay Mishra — Analyst
Anupam Gupta — Analyst
Jayesh Gandhi — Analyst
Abhishree Bang — Analyst
Khadija Mantri — Analyst
Amit Agicha — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to Capacit’e Infraprojects Limited Q2 and H1 FY ’25 Earnings Conference Call. [Operator Instructions]
Before we begin, a brief disclaimer, the presentation which Capacit’e Infraprojects Limited has uploaded on the stock exchange and their websites, including the discussions during this call contains or may contain certain forward-looking statements. Concerning Capacit’e Infraprojects business prospects and profitability, which are subject to several risks and uncertainties and the actual results could materially differ from those in such forward-looking statements. [Operator Instructions]
I now hand the conference over to Mr. Rohit Katyal, Executive Chairman, Capacit’e Infra. Thank you, and over to you, sir.
Rohit Katyal — Executive Chairman
Good morning, everyone. On behalf of Capacit’e, I welcome everyone to the Q2 and H1 FY ’25 earnings conference call of the company. Joining me on this call is Mr. Rajesh Das, CFO; Mr. Nishith Pujary, President, Accounts and Taxation; and Alok Mehrotra, Executive Director, Finance, along with Marathon Capital, our IR team. I hope everyone has had an opportunity to look at our results. The presentation and press release has been uploaded on the stock exchanges and our company’s website.
Our company has commenced the year on a positive note, achieving 28% year-on-year revenue growth from operations during H1 FY ’25, along with significant improvement in margins. The back-to-back strong quarterly performance sets the tone for the second half of the year, wherein we anticipate further operational improvements. With central elections and monsoons behind us, we are witnessing further uptick in execution across our project sites. The improved execution has helped us in better absorption of fixed costs, thereby leading to improved profitability.
Over the past few years, we have successfully optimized our project portfolio, resulting in significant expansion of order size, reduction in projects under execution, increased revenue contribution per project, enhanced management efficiencies, leading to improvement in margin profile. On the order book front, we are witnessing significant traction both from private and public sector. We have so far been awarded projects worth INR1,500 crores, excluding BDD addition of INR858 crores during the current fiscal and are confident of achieving and surpassing our guided order book addition for FY ’25.
We have entered a high-growth phase supported by a diversified order book from esteemed clients across public and private sector. Leveraging our robust financial position and execution expertise, we are poised to establish new performance standards.
Coming to the consolidated performance highlights for H1 FY ’25. Revenue from operations for H1 FY ’25 stood at INR1,088 crores, up by 28% as compared to INR852 crores in H1 FY ’24. EBITDA for H1 FY ’25 stood at INR217 crores, up by 42% as compared to INR153 crores in H1 FY ’24. EBITDA margin for H1 FY ’25 stood at 19.7% as compared to 17.6% in H1 FY ’24.
EBIT for H1 FY ’25 stood at INR173 crores, up by 71% as compared to INR101 crores in H1 FY ’24. EBIT margin for H1 FY ’25 stood at 16.1% as compared to 11.6% in H1 FY ’24. PAT for H1 FY ’25 stood at INR98 crores, up by 153% as compared to INR39 crores in H1 FY ’24. PAT margin for H1 FY ’25 stood at 8.9% as compared to 4.5% in H1 FY ’24.
I now turn to the consolidated performance highlights for Q2 FY ’25. Revenue from operations for Q2 FY ’25 stood at INR518 crores, up 23% as compared to INR422 crores in Q2 FY ’24. EBITDA for Q2 FY ’25 stood at INR101 crores, up by 30% as compared to INR77 crores in Q2 FY ’24. EBITDA margin for Q2 FY ’24 stood at 19.3% as compared to 17.7% in Q2 FY ’24. EBIT for Q2 FY ’25 stood at INR79 crores, up 60% as compared to INR50 crores in Q2 FY ’24. EBIT margins for Q2 FY ’25 stood at 15.2% as compared to 11.4% in Q2 FY ’24. PAT for Q2 FY ’25 stood at INR45 crores, up by 126% as compared to INR20 crores in Q2 FY ’24. PAT margin for Q2 FY ’25 stood at 8.6% as compared to 4.5% in Q2 FY ’24.
Gross debt stood at INR343 crores as on 30th September as compared to INR343 crores as on, March 31, ’24 with gross debt-to-equity at 0.21 times. Order book on standalone basis stood at INR9,203 crores as on September 30, ’24. Public sector accounts for 73%, while private sector accounts for 27% of the total order book.
I now open the floor for questions, please.
Questions and Answers:
Operator
Thank you very much. [Operator Instructions] The first question is from the line of Nirvana Laha from Badrinath Holdings. Please go ahead.
Nirvana Laha
Hi, am I audible?
Rohit Katyal
Yes.
Operator
Yes.
Nirvana Laha
Yeah. Thank you. Sir, congrats on another great quarter. Sir, my question is a little strategic in nature. So if I look at your execution history from FY ’18 to FY ’24, obviously, earlier you used to be 80%, 90% private order book and now you’re about 75% government order book. So you’ve explained that you do the design part and government projects and you’re able to earn 200 bps higher margin in these projects.
But sir, if I look at the working capital, it used to be less than 100 days pre-COVID. Now it is touching 200 days, so at a return on capital level, sir, we are either at the same level or maybe even lower, plus there are liquidity risks of non-fund base limits, etc. So I know you’ve answered this before, but I would again like to hear your thoughts on how do you plan to keep the balance between private and government, is there any intention to bring it back to 50-50 or are you comfortable at these levels?
Rohit Katyal
Yeah, good question. So the point is that you have to look at the whole year performance to come at any conclusion as far as the working capital is concerned. If you look at the quarter one, our — there was basically a reduction in the net working capital by one-third — 13 days, this quarter, some of our payments got shifted into October because of elections which were going on. However, now with the elections getting over by November 23rd, we see a very strong collection in quarter three happening that is evident from the INR200 plus crores collection done in October already. And therefore, you will see a reduction in net working capital in quarter three with further improvement in quarter four. We stand committed to that 100-day level by the year end, this I have repeated earlier also. However, the internal targets continue to remain at 90 days, but we are very confident of achieving 100 days net working capital by the end of the current fiscal. And that will only improve going forward.
You see that you mentioned COVID and COVID taught us that overdependence on any one, whether private or public is not warranted. It is very dynamic in nature. We continue to bid for both private sector and government sector, our last major order has happened from private sector. Again, therefore, tilting or improving the balance of order book slightly in favor on private sector. So there is nothing called 50-50, we will continue to bid for projects in both private and public, quality of plan continues to be the most important parameter while taking an order book. And third, liquidity issues cannot arise. The retention amount over the last one year on absolute basis on increased top line has reduced to INR135 crores from INR170 crores last financial year.
The company is sitting on more than INR250 crores of unutilized bank guarantee limits and therefore we do not see any issue of collecting our retentions or advances, which will happen substantially in the current quarter, given the new order wins due to non-availability of non-funds based limits. I hope to have covered all your points. Thank you.
Nirvana Laha
Sure sir. Thanks a lot for the detailed answer. Sir, on the Signature Global order, first of all, congratulations on banking such a large order. When can we see the execution start and how do you see it ramping up?
Rohit Katyal
So the execution of this order will start in quarter four of the current fiscal. And given the completion period, it should peak at about INR25 crores to INR30 crores per month. This order is in two phases. Phase one will start from first quarter and phase two may start from the second quarter of the next fiscal.
Nirvana Laha
Okay. Sure. And sir, if I look at your FY —
Rohit Katyal
I can correct it, fourth quarter and the first quarter.
Nirvana Laha
Okay. Thank you so much. Sir, if I look at your FY ’24 annual report, we had taken a INR112 crore receivables write-off. I assume this was to do with clients, which faced difficulties during COVID. If you can call that out please, because I’m not aware of the history which clients and what projects are they pertaining to? And if there are any other receivables on our book currently, which are at risk of such write-offs, I understand that you’ve already taken possession of some assets which you intend to sell. So if you can just give some idea about all these aspects, what is happening to the assets held for sale plus how much more receivables can be expected to slip to us taking possession of asset and the write-off happened from which client? Thank you.
Rohit Katyal
So the write-offs predominantly close to INR80 crores, INR90 crores were for the Radius Group. And these write-offs were not only because Radius was in joint venture somewhere with, somewhere with DMB — sorry, DB Realty and elsewhere. So coming to the fact that it’s not only last financial year, the company has followed an aggressive provisioning policy subsequent to the COVID year and we have provided for more than more than INR180 crores of expected credit losses, which means that we are not left with any surprises, which I reconfirmed — reaffirmed in the last quarter as well.
And therefore, we do not expect the PAT to be impacted by any untoward provisioning happening from slow-moving debtors or bad debts and/or additional provisioning. That’s point number one. Point number two, the company’s aggressive collection drive, which is more of legal in nature at various forums, whether RERA or whether it is at NCLT or High Court, has ensured that the company is today holding assets in excess of INR200 crores market value as against a total collection —
Nirvana Laha
Due of INR100 crore.
Rohit Katyal
A collection of about INR115 crores. We expect this realization from fixed assets over and above our collection normal targets from our debtors to happen over the next seven quarters to eight quarters. Now what will this mean? This will mean that about INR100 crores of debtors or debt levels will fall in the balance sheet. Number two, the bottom line will strengthen by close to INR80 crores, INR85 crores. And number three, the gross debt of the company will fall apart from whatever it was from the operational profits by about INR200 crores from these collections. Hope to have explained.
Nirvana Laha
That’s great to hear, sir. Last question, sir. Has the sale already started or which quarter do you anticipate this sales starting from?
Rohit Katyal
We are waiting for the NOC for State Bank of India. Pending the NOC sales of about INR17 crores have already happened. We expect sales of close to INR80 crores by March ’25 and the realization in the subsequent quarter. But as I told you, please don’t hold me responsible, these are internal targets. You will see the complete realization hopefully within seven to eight quarters, but INR85 crores is a target for the current financial year.
Nirvana Laha
Thank you so much, sir. Congrats on the great execution and hope you have a great H2. Thank you.
Rohit Katyal
Thank you.
Operator
Thank you. The next question is from the line of Aditi [Phonetic] from RSPN Ventures. Please go ahead.
Aditi N
Hello. Thanks for the opportunity. Just taking forward the question from the previous participant with respect to provision of impairment, so in this quarter as well, other expenses have increased quarter-on-quarter. So is there — is there any part of that impairment included in this quarter numbers as well?
Rohit Katyal
There is no impairment madam. There is a policy of expected credit loss, which every company follows. And that is exactly this expected credit loss or what we know as ECL is a policy which is approved by the auditors and also by the audit committee of the company. And the company follows that policy, which means that there is a certain provisioning on the working capital that is work in process. There is certain provisioning on the retention and there is certain provisioning on the debtors. So this is a normal thing.
And again, if you look at the other expenses, the total expenses have to be looked into and as a percentage because the revenue of quarter two is lesser than quarter one, obviously because of the monsoons where we lost 22 days. You will have to look at the full year where we believe that the company will improve as a percentage to top line basically on all expenditure parameters. So further, when you are looking at provisioning, you also have to look at other income, whether provisioning happens. So when you take the net of it, it’s a much improved positioning.
Aditi N
Got it. And I have a further — a few other questions. So one is the cash on hand essentially that has dipped from in the first half. So is there anything to read into that?
Rohit Katyal
Madam, you please see that there is an increase in the temporary increase in the debtor where the amount sitting in WIP is moving towards certified bills. That collection has just shifted by 10 days coming into quarter three of the current financial year. So the cash position will be back to what it was by the end of Q3, nothing to read into that.
Aditi N
And the EBIT margins have been purely great in the last — in the first half, so is that sustainable and/or do we see some moderation going forward?
Rohit Katyal
With the current order book superimposed, we do believe that this will continue at least for the next four quarters until unless there is something toward which happens to the industry, which we don’t expect.
Aditi N
Got it. And sir, last question, since there is this data center project that you were bidding for 400 — around INR700 crores. So any update on that?
Rohit Katyal
Let the elections get over, madam. We believe that at the moment, all the orders are from government in the Maharashtra state are at status quo. So once the elections are over, we will then pursue for that. At the moment, at least for the current month, we will be targeting only the private sector and the private sector negotiations are wrong and you should be waiting for some good information.
Aditi N
Got it. Thank you so much.
Operator
Thank you. The next question is from the line of Parvez Qazi from Nuvama Group. Please go ahead.
Parvez Qazi
Hi, good afternoon. Thanks for taking my question. So my first question is regarding order intake. I believe you had given a guidance about INR3,000 crore of order intake in FY ’25. So does this still stand or do you want to revise that number?
Rohit Katyal
So, Parvez, we continue with that target of INR3,000 crores. I think there is a scope of improving in actuals. But you have seen that we have been very choosy in picking up the orders because anything which we do today will have an impact, whether positive or negative two years down the line. So we are very, very particular, not to forget that MHADA has to still add about INR3,000 crore to INR4,000 crores of order book to the overall order book of the company. So the company will be cautious in picking up orders. But excluding MHADA, INR3,000 crores is something which we definitely see as happening in the current financial year.
Parvez Qazi
Sure. And for our two big projects, which is MHADA and CIDCO, would be great to get a status of the project in terms of what is the workfront available as of now and what is the execution run rate now and where do we expect to see it going ahead?
Rohit Katyal
Yeah. So the execution run rate for October for CIDCO was close to INR50 crores. We expect that to go to INR65 crores by December and INR75 crores by January per month. The total land available is INR2,400 crores across six locations, which means that we have to still build about INR1,500 crores on certified mechanism on these six locations, which has to happen by March of ’26 in totality. The seventh location is identified, however, once it is received, it shall be properly informed to you.
As concerning MHADA, we have received the land for five towers of sale component, which are close to 90 storeys in height or 305 meters. Apart from that, we have 14 towers on the rehab portion of 40 storeys and we expect another eight towers to be released by December of the current quarter, that is quarter three. So we do believe that the execution will continue as per capacity as a subcontract at close to INR20 crores per month. However, that will increase to about INR25 crores to INR28 crores per quarter four and it should increase significantly to cross more than INR100 crores per quarter from the next financial year.
Parvez Qazi
Sure. Thanks and all the best for future.
Rohit Katyal
Thank you.
Operator
Thank you. The next question is from the line of Ram [Phonetic] from Cycas Investment Advisors. Please go ahead.
Ram
Hello. Am I audible?
Operator
Yes, sir.
Ram
Yeah. Well, congratulations on the quarter. I just have one question. Given the recent discussions around the economic environment, particularly around economics — I mean, slowdown in government spending on infra projects, which has been highlighted in various media reports and all. I wanted to get your perspective on this with your significant exposure in public sector projects, can you share whether you’re observing any tangible impact on project approvals or payments or execution timelines from the government side?
Rohit Katyal
I haven’t read such article. However, having said that, the government spending that INR11 lakh crore stands at the highest. You are seeing a big traction in the public or private sector as well with the 40% increase quarter-on-quarter in the registrations of apartments, okay. And point number three is you will see a significant spend on the industry level, that is factory side going forward. I’d be on the contrary, anticipate shortage of quality contractor from quarter four of the current fiscal. So I don’t see any slowdown.
On the contrary, the project pipeline is full for all building construction companies. They are on sitting on record order books, including our company. So I don’t see any such thing happening. Yes, winters are here, you will see NGT coming into play in highly polluted areas like Delhi NCR. You will have some temporary shortfalls. How much that impacts the revenue is anyone’s guess. So I wouldn’t like to give a speculative answer on that front. But yes, on overall, we see serious traction both in public sector and by private sector spend all in residential and in institutional buildings like hospitals and so on.
Ram
Okay. Thank you.
Operator
Thank you. The next question is from the line of Rajesh Jain from RK Capital. Please go ahead.
Rajesh Jain
Hello, sir. I have three questions. So I recently started packing your company and I was going through some of the very old calls of 2018 and ’19 much before pre-COVID just after your listing. So I understand that today you have an order book of approximately around INR10,000 crores and you have guided for 25% growth for the next two, three years. But back then also in 2018 and ’19, even much before COVID, you had an order book of INR8,000 crore and you are guided for the same 25% growth for two, three years. But what actually panned out was only one year of growth and then subsequent de-growth.
So what has changed and I mean in the current scenario, how confident you are that the history will not repeat that the growth will not be achieved? Can you just throw some light on that?
Rohit Katyal
Good question. So you have to first track the company from 2013 till 2019, ’20, which has seen a compounded annual growth of excess of 35%, 40%. So first [Indecipherable] was in the COVID year. And thereafter there was recovery, but not to the extent to match with March 2020. All right. That’s number one.
Number two, order book was INR8,000 crores or more. However, in that order book, MHADA was non-operational at that moment in time, which is operational now. CIDCO for the first one and a half year was non-operational. So those order book was INR9,000 crores, the revenue was coming from only INR3,500 crore or INR4,000 crores business. So that explains the reason why the growth is now happening over the last three and a half or four quarters, simply because the order book is operational and the company is driving substantial revenue from these two big-ticket size orders.
Point number three, the INR8,000 crores order book was spread across maybe 50 projects and now this INR10,000 crores is spread about maybe 20 to 23 projects, thereby giving the company an opportunity to bag another seven or eight projects, having minimum revenue of INR10 crores per month per project and therefore then taking it to the growth projections what we have given you. So summary of all this is that we are more than confident in achieving whatever targets we have lined out.
Rajesh Jain
Okay, that’s great to know, sir. So that means you have to keep tracking the operational order book. So in your current order book, is there anything which is not operational?
Rohit Katyal
Everything is operational. Only one location of CIDCO, seventh location is balanced to be received apart from that everything is operational.
Rajesh Jain
Okay. And what is the value of that which is not operational?
Rohit Katyal
About INR2,000 crores.
Rajesh Jain
Okay sir. Okay. That’s great. Okay. Sir, just two more questions. Again, one related to the history and then one related to accounting norms. So in the past, what I came to know from my circle is that you had a lot of issues related to delayed payments of salaries and delayed execution of projects, even those which are operational. I mean, I don’t know how much of that is true. So I just wanted to hear from you how much of that is true and whether any of that project delays or salary delays issues persist today or is there any risk of that coming back?
Rohit Katyal
There are too many questions. Number one, whatever the company did, it also during the difficult times, it worked within the cash flows, which were received per quarter. Subsequent to that, the company raised close to INR350 crores through preferential QYP and infusion by the promoters. So therefore, any cash flow issues, whoever has told is a matter of maybe long past and any which way the company has along with its amazing team confronted it very, very well. So I do not know who has given you this feedback, which I can only call hearsay.
However, to sum up, we do believe that the current traction of improvement in revenues, bottom line and today the company has a permanent workforce of more than 1,800 strong staff, 80% from the engineering background, 20% from support commercial and more than 1,400 technicians to support the revenue guidance of 25% growth year-on-year. So I believe that the cash flow issues which you are referring to were definitely due to the INR200 crores, which I just mentioned a short while ago, which was stuck with the private sector because the company today is successfully has converted them into real estate assets and now converted them into real estate assets and now is going from liquidation of the same over the next seven quarters to eight quarters, which means the company can only improve the cash flow by over INR200 crores apart from whatever margins it realizes from operations.
Rajesh Jain
Sir, today, there are — are there no salary delays or project delays today?
Rohit Katyal
Sir, who told you there are salary delays? Please give me one reason.
Rajesh Jain
No, I’m just asking you. Today…
Rohit Katyal
I just told you, there are no salary delays. There are no project delays. All projects are within the stipulated timelines original or amended by the client. So the answer is, there are no delays, number one, on payment of any statutory levy and/or salaries, and there are no delays in project execution.
Rajesh Jain
Okay, sir. That’s very reassuring. And my last question is on accounting norms in your business. So just — because we are into the — you’re a contractor who execute projects for the other builders for the real estate companies. As far as those real estate companies go, like Godrej or DLF or other housing companies, their pre-sales number flow to revenue as per the accounting norms after project completion and after OC is received, as per my understanding. So in your business, is there any accounting norms for the remaining to flow to books based on certain percentage of completion method? And if yes, then can you elaborate on that, just for my understanding?
Rohit Katyal
So we are not a real estate company, first of all. And we follow POCM method as per IndAS 116 — 115, 116. So the point is that revenues are recognized accordingly, and we will continue to follow this accounting norm, which is followed by all construction companies across.
Rajesh Jain
Okay, sir. Okay. Thank you so much. Thank you.
Operator
Thank you. [Operator Instructions] The next question is from the line of Akshat from Flute Aura Enterprises Private Limited. Please g ahead.
Akshat
Hi. Thank you for taking my question. So I have a couple of questions. First question is, are we seeing any slowdown because of the Maharashtra elections in our construction activity? And my second question is on the employee expenses. So they has — they rise sequentially. So any reason — specific reason for that? Thank you.
Rohit Katyal
Yes. So slowdown will happen during elections from order inflow perspective on the public sector side pertaining to the state where the elections are happening. So elections are happening now in Maharashtra. There’s a code of conduct in place. And obviously, during code of conduct, which only ceases after the elections are fully over. There will not be any new orders which could flow in with government to any company. That’s number one.
Your second question was…
Akshat
Employee — employment cost.
Rohit Katyal
The employee cost has increased by INR7 crores over the next — last quarter. This is primarily due to increase in employee strength, new joinees which I mean to say, and obviously, the increments which have happened. And this will be on an overall year basis as a percentage lower to the top line, as a percentage, as a opposed to last financial year.
Akshat
Okay, sir. Got it. Thank you.
Operator
Thank you. The next question is from the line of Akshit Mehta from Seven Rivers Holding. Please go ahead.
Akshit Mehta
Hello.
Operator
Yes, sir, you are audible.
Akshit Mehta
Yes. Thank you for the opportunity. Sir, two major questions I had is, one is, what is the total amount of bank guarantees and LCs that we currently have on — that is currently given? I mean, not just the unused ones, but the total amount that we currently have?
Rohit Katyal
Your question is how much bank guarantees have we already issued?
Akshit Mehta
Yes.
Rohit Katyal
So total bank guarantees issued currently to the clients are INR729 crores within the consortium. And about —
Rajesh Das
Within the consortium is INR347 crores.
Rohit Katyal
So including consortium and project specific for CIDCO and MHADA, the total guarantees issued is INR730 crores.
Akshit Mehta
Okay. Out of which INR250 crores you are saying is currently still free or unused that we can use for future projects, right?
Rohit Katyal
Absolutely.
Akshit Mehta
Okay. And another question I had is with the unbilled revenue or the revenue that we have given to certification, that number is increasing quite sharply over the last couple of years. Any kind of reason for that?
Rohit Katyal
Your voice is not clear. I have not understood your question, please.
Akshit Mehta
Hello. It should be better now.
Rohit Katyal
Yes.
Akshit Mehta
Yes. So my question was that our unbilled revenue, which is — or the revenue that we have for certification, that has been increasing quite a lot over the last couple of years. So any specific reason that we are seeing that increase in number and what it could be going in the future?
Rohit Katyal
So you please, if you compare, the WIP was INR889 crores, which is work done, not billed, bills submitted, all that put together was INR889 crores on a top line of close to INR450 crores last financial year. Okay, that is INR900 crores on a much higher top line. Number two, the uncertified bills continued to be at INR434 crores, even though there has been an increase in the top line. And this overall stagnancy will now show reduction. So there was an increase earlier, then there was two quarters of stagnancy and now you will see reduction over the quarter three and quarter four and the subsequent quarters going forward. So the overall target is to get this number over the next four quarters to five quarters to approximately INR900 crores, which would be that comparable to the number what you are comparing with.
Akshit Mehta
Okay. So we want to get back to two years back what the number was?
Rohit Katyal
Absolutely, because there is no reason. We have started the POCM method about three years ago. There was a temporary increase in debt. And I will not say that it was not a big increase. Yes, it was substantially big increase. However, if you see, that amount has now stagnated even though the top line has improved significantly. Going forward, the top line is bound to increase. At the same time, you will have contracted as assets reduction — or contraction in the contract assets in a phase wise manner to bring it back to INR900 crores over the next three quarters to four quarters.
Akshit Mehta
Okay. Thank you, sir.
Operator
Thank you. The next question is from the line of Dhananjay Mishra from Sunidhi Securities. Please go ahead.
Dhananjay Mishra
Yes. Hello, sir. Congrats on a very great quarter, similarly great quarter. Sir, my question is with respect to the seventh side of CIDCO, as you said that it will be handed over. So I mean, what is the status in terms of brand [Indecipherable]?
Rohit Katyal
CIDCO seventh side, the environmental has already been received. Earlier there was an issue of the CRZ rules, which was only 50 meters permitting. That got relaxed to 100 meters. So we are pursuing with the client. And we hope that the seventh location will be given sooner than later in the current financial year itself. And that is the current status of CIDCO seventh location.
Dhananjay Mishra
Okay. So land and everything is clear. There’s no…
Rohit Katyal
Sorry?
Dhananjay Mishra
There is no occupation of illegal things.
Rohit Katyal
No, no, no. All these lands belong to the government. There is no problem from a land perspective. It’s that the government also wants that the lottery system or allotment system to simultaneously start along with execution at the new locations.
Dhananjay Mishra
And you said that we have now INR1,500 crores unexecuted part of these six locations, right?
Rohit Katyal
Absolutely.
Dhananjay Mishra
And then current monthly billing is about INR50 crores, which will increase to INR80 crore, INR90 crore in next three months, four months?
Rohit Katyal
Yes.
Dhananjay Mishra
So next year, can we assume that out of INR1,500 crore, for FY ’26, we will be doing close to INR1,000 crores from CIDCO project itself?
Rohit Katyal
That is the asking.
Dhananjay Mishra
Okay. And can you repeat the MHADA monthly run rate as of now? I didn’t hear it.
Rohit Katyal
So MHADA, at the moment, we are doing about INR20 crores per month. We will continue to do that in quarter three. We expect that to improve to INR25 crores, INR28 crores in quarter four. And then it can improve to INR100 crores from next financial year per quarter. It all depends on the availability of new building. However, given the traction, we are quite hopeful that this is going to translate into order book, executable order book.
Dhananjay Mishra
And this is our share of…
Rohit Katyal
Obviously, we are not taking — we are not consolidating the revenue at the LLP level, okay, because we own 35% of that. Tata Projects consolidates that. However, we will book our share of profit, which hopefully should start from next financial year and should be substantial.
Dhananjay Mishra
So as of now, I mean, it is not showing in the P&L, right, in the current quarter?
Rohit Katyal
No, no, no. I mean, if that was shown, your revenue would have been INR600 crores. So we are not showing the revenue at the LLP level. We are showing the revenue only at the subcontractor level.
Dhananjay Mishra
Okay. So we will only take profit from those projects as a JV profit?
Rohit Katyal
I would like to reiterate that we will be entitled to book our share of subcontract, which will be at the end of the project close to INR5,000 crores. And we will be entitled for our 35% project at the LLP level, that is the joint venture level. So these are the two things, which our company will recognize.
Dhananjay Mishra
Okay. And second question in terms of upcoming opportunity, so apart from residential segment, are we looking other sectors like railway or other government projects into construction segment?
Rohit Katyal
So we are not very happy with the RLDA type of projects because of the negative cash flow and the skewed payment terms, which are mentioned over there. And therefore, we have — though we qualify for all the projects, we have desisted from participating in RLDA projects, number one.
Number two, we are not only bidding for residential. Nearly 15% comes from hospital that is health care. We have executed two malls over the last four years. We have executed commercial buildings like Oberoi Commerz III, which has been handed over to the client. So there is a mix of residential, commercial, retail and health care coming a part of our portfolio.
Currently, all the projects are mixed-use projects, including the one we will be executing for Signatureglobal. So these bigger projects basically are not only residential, but they are mixed. So you will have some portion of retail, you will have some portion of non-tower area and then the residential plant. Apart from this, you are aware that the company has been executing data centers.
We have successfully completed the Delta factory at Krishnagiri, and the company is actively pursuing opportunities in the factory side, which have a better financial closure. The clients are maybe one level higher than the developers, which we work for. And that now we’re having the qualifications to do that augurs well for the company. So you will be basically therefore operating in four segments: residential, commercial, institutional, which would include data centers, and the fourth would be factories. So very exciting times. Please wait for quarter four.
Dhananjay Mishra
Okay. And lastly, can you give major orders apart from CIDCO, which are contributing to our revenue as of now?
Rohit Katyal
All. So Raymond’s is contributing INR20 crores per month. MHADA is contributing nearly INR18 crores, INR20 crores per month. You have CIDCO, which is now contributing in excess of INR45 crores to INR50 crores a month. You have JJ, which is contributing in excess of INR10 crores a month. You have Bhagwati Hospital, which is contributing more than INR10 crores per month. You will soon have Bhandup Hospital, which will start contributing more than INR12 crores, INR15 crores per month. You will have M3M contributing close to INR7 crores, but is expected to go to INR15 crores from December onwards.
So all the projects — basically, the idea of taking limited projects is that we do not want to have any project in the portfolio which gives less than INR10 crores per month. And once that happens, only then will you see the growth of the 25%, 30% on a higher base. And that is what exactly we are focused on.
Dhananjay Mishra
Okay. Thank you. All the best, sir.
Operator
Thank you. The next question is from the line of Anupam Gupta from IIFL Securities. Please go ahead.
Anupam Gupta
Yes. Good afternoon, sir. Just a few questions. So firstly, on the order book, is the INR858 crores, which you mentioned in the opening remarks included or not included?
Rohit Katyal
Not included.
Anupam Gupta
Okay. So that is — so overall order book should be INR10,000 crores, if you include that approximately?
Rohit Katyal
Approximately, yes.
Anupam Gupta
Okay. And you said by the end of this year, so another INR1,500 crores from non-MHADA and possibly another INR3,000 crore of MHADA orders will get included?
Rohit Katyal
No, no. I would like to correct you. INR3,000 crores non-MHADA will definitely happen. MHADA, as and when we get the locations to start the construction, that will be added automatically, and we will inform you in that quarter. But MHADA is close to INR2,300 crores now. All right. And we just have to execute more than, I think, INR1,400 crores, INR1,500 crores out of that. So that is substantial for the next two years. However, at the LLP level, both Tata Projects and Capacit’e are putting all efforts to get the entire portfolio of the project execution in that. And we are quite hopeful that by quarter two of next fiscal, that should be happening. So let’s wait for the elections to get over and then take it forward from there.
Anupam Gupta
Okay. And just continuing on MHADA, you said something you’re not consolidating at this point of time. Can you just clarify that once again, what will you consolidate and starting when?
Rohit Katyal
See, we will not be consolidating the top line at MHADA at the LLP level, which is the implementing — sorry, which is the executing authority for MHADA, okay. That revenue is not consolidated in our numbers as our numbers would increase by nearly 25%, 30%, okay. We are only taking the revenue, which we are executing as subcontractor. What we will add as a line item will be the profit, our share of 35% profit of the LLP into our books — standalone books going forward as and when the profits start accruing in the LLP.
Anupam Gupta
Okay. Understood. And when do you expect that to happen or start to happen?
Rohit Katyal
So there are certain, I think, minimum turnover guidelines of Tata Projects. I believe that is about close to INR1,500 crores or so. Once that threshold is breached, the profitability will start to accrue immediately there.
Anupam Gupta
Understood. Okay. And okay, second question was, you said you have an inventory — sorry, you have receivables as assets close to about INR200 crores, which you will monetize. Why is SBI’s permission required to monetize?
Rohit Katyal
Because some of these properties are mortgaged with the consortium of banks, all right, and therefore, we will be requiring their NOC. Verbally, they have given us a go ahead, but it has gone as a proposal to their competent authorities. And we’ll be therefore requiring that NOC for certain of the sale of the properties, especially the Bangalore properties, all right. Certain properties which are slated for sale in quarter four of the current fiscal will not require their permission but we are taking a blanket approval and that all the funds will then, from the sale of the properties, will flow into the lead bank, which is State Bank of India.
Anupam Gupta
Okay. And all of that in your balance sheet is currently reflected in other long-term assets, right?
Rohit Katyal
No. About INR90 crores is not reflecting only. That’s already been written off. I just explained to you, out of INR210 crores, what is reflecting in the books is close to INR100 crores, all right. And once that INR100 crores come, it will impact two things. It will impact the debtors going down and the asset held for sale. These two will go down. So one is the asset will fall, the gross block. The second thing is that our debtors will fall. Third thing is that balance, which is not appearing in the books, will hit your profitability positively.
Anupam Gupta
Okay. Okay. Understood. And just one last question. In your order book, what portion of projects are currently under execution in NCR, which will see impact, let’s say, over the next two months at least?
Rohit Katyal
So we have M3M, which is going on in Noida. So far, there are no restrictions, but you can never get. So there are no restrictions on construction. There is restriction on some vehicles, which has come in at the moment. There is restriction on the sand, but we don’t buy sand. So we will have to ensure that our concrete manufacturers have sufficient quantity to negate that impact. And M3M, as I told you, we will start billing from quarter four of the current fiscal. So I don’t see any meaningful impact, maybe INR15 crores, INR20 crores for the quarter at best.
Anupam Gupta
And nothing on DLF as well because the construction has…
Rohit Katyal
That is over.
Anupam Gupta
Okay. Okay. Understood. And just one last question. Any issues we have seen on employee availability at all?
Rohit Katyal
Employee?
Anupam Gupta
Employee availability?
Rohit Katyal
Availability. That’s always a challenge to get good people, so that will continue till the time we do business, isn’t it, Anupam? And the point is that they are across industries, it’s nothing specific to us. The challenge is to retain workmen, and we are amongst the first few companies in the construction industry, building construction industry, we have adopted a 15-day payment cycle successfully over the last three months, which has made a significant improvement in we being able to retain labor contractors, and we hope that, that will continue. So you have to do things which are innovative in nature to ensure that the labor availability, especially the trained labor availability, doesn’t become a challenge, therefore, an impediment to your growth.
Anupam Gupta
Sure. Understood. Sure. That’s all from my side. Thank you.
Operator
Thank you. The next question is from the line of Jayesh Gandhi from Harshad Gandhi Securities. Please go ahead.
Jayesh Gandhi
So first of all, congratulations on good numbers.
Operator
Sorry to interrupt you, sir. I would request you to please use your handset.
Jayesh Gandhi
I’m using — madam, I’m using my handset. First of all, very congratulations on good set of numbers. Am I audible, sir?
Rohit Katyal
Yeah, please go on.
Jayesh Gandhi
Okay. Sir, my question is on order book position. If I look at your order book-to-sales ratio in the past three, four years, it is coming off. And currently, I mean FY ’24, it shows as 4.7%. I’m guessing even on September, if you take probably, it would be at a similar level. So is it our conscious decision to do that? Or are we choosy for margins? Or is there a competitive pressure? Can you just throw some light on that?
Rohit Katyal
Sir, if you see our order book, it is in line with our competition and the industry. We can — earlier, there were times where the order book was 6 times, but the execution period was five years. Today, if the execution period on an average is coming down, then your order book cannot increase abnormally because you need to execute the order book as well. So we are — our policy is that we need to take orders in a particular financial year. Let’s say, if the order target is INR3,000 crore in FY ’26 — sorry, FY ’25, then the target for execution is similar to the order intake in the next financial year. So that is the policy which we follow. And obviously, as I just told you, to the earlier gentlemen, our policy is that whatever orders we intake, we should have an opportunity to bill at least INR10 crores per month. Otherwise, the risk-reward ratio is not very conducive for the company.
Point number three, choosy, yes, we are. There is ample opportunity. There is no reason to go and just pickup orders and then cry over spilled milk for two years down the line. So yes, we will be choosy. Even if we are choosy, there is enough opportunity available both in public, private and in the factory side of things.
Jayesh Gandhi
Okay. I get it. And so then can I conclude by saying that we will be somewhere between 4.5% only in future as well?
Rohit Katyal
It could be 5%, it could be 3.5%. But on an absolute basis, we will only continue to grow.
Jayesh Gandhi
That’s it from my side, sir. Good luck for future.
Rohit Katyal
Thank you.
Operator
Thank you. [Operator Instructions] The next question is from the line of Abhishree Bang from JHP Securities Private Limited. Please go ahead.
Abhishree Bang
Hello. Am I audible?
Operator
Yes.
Abhishree Bang
Yeah. Thank you for giving this opportunity to me. Sir, first of all, congratulations on good Q2 performance. I just want to know that could you please share your receivable numbers with a breakup between debtors, unbilled revenue, retention money and mobilization advance for that matter?
Rohit Katyal
Madam, these are too many questions and very detailed. You can please send me a mail to our investor relations, and they will provide whatever data we are permitted to provide in whatever detail you want. So whatever is permissible, they will definitely provide it to you. But such a detail now, for example, it is there in our financials, in the balance sheet already mentioned. However, the breakup can be provided at the movement then can be studied by you.
Abhishree Bang
Okay. So I just want to know whether all of this data could be provided? Like are you — because sorry to say, but IR team of our company, they are not willing to provide it on a quarterly basis for the public information. And we only have access to get this information on an annual basis. So either you…
Rohit Katyal
What we will do is we will set up your conference with our IR team. You can discuss with them. I am sure that whatever is permissible under the LODR guidelines, they will have no hesitation. And that’s what Capacit’e has been following since inception. So we are very transparent. Whatever data you want and is permissible under SEBI LODR guidelines, we definitely will provide that to you. That I can assure you.
Abhishree Bang
Okay. Okay. Thank you.
Operator
Thank you. The next question is from the line of Khadija Mantri from Capri Global. Please go ahead.
Khadija Mantri
Good afternoon, sir. So I have two questions. One is, in Q3, do we expect the execution to be impacted because of election and whether we will — or we will have a good growth on Y-o-Y basis as well?
Rohit Katyal
Please expect execution to grow. Elections have no impact on execution of existing projects. They only have an impact on government inflow of orders of the state where the elections are happening. So I don’t see any reason. For elections having any impact whatsoever on the top line of the company, the growth will continue.
Khadija Mantri
Okay, sir. And sir, the next question is, this INR1,200 crore order that you received from Signatureglobal, it is part of the INR1,500 crores order inflow that we have talked about till year to date? Or is it over and above that?
Rohit Katyal
No, it is a part of the INR1,500 crores year-to-date order inflow. And we are targeting another INR1,500 crores over the next five months, the current fiscal.
Khadija Mantri
And sir, in this project, the scope of the work for us remains the same as the previous project? Or is it something different that we would be doing in this project?
Rohit Katyal
No. All private sector projects, whether we do, L&T does, more often than not we try to do only shell and core. And we will be doing only shell and core works for the residential tower, non-tower and the retail area. So this is — the scope will remain the same. But yeah, as you are seeing that the sizes of the projects especially in Delhi NCR area increasing manifold, so earlier, the average size used to be INR250 crores, INR300 crores, which has now suddenly shot up to in excess of INR800 crores, INR1,000 crores. Apart from that size difference, we don’t see any other scope change as of now.
Khadija Mantri
Okay, sir. Thank you so much. All the best.
Operator
Thank you. The next question is from the line of Amit Agicha from H. G. Hawa. Please go ahead.
Amit Agicha
Good afternoon, sir. Am I audible?
Operator
Yes, sir.
Amit Agicha
Thank you for the opportunity and congratulations to the whole team for good set of quarter numbers. My question was with respect to like, are there any plans to diversify into new geographies or segments beyond the current focus?
Rohit Katyal
Sir, we, before COVID, were in seven top cities of the country. Again, we have increased over the last 1.5 years back. We are in Mumbai. We will be in Pune whenever the opportunity comes, but yes, we are there. We are in Mumbai MMR, which is considered as one geography. We are in Delhi NCR, which is considered as a second geography. We are in Gandhinagar, Gujarat, which is the third geography. We are actively looking at Hyderabad and bidding in projects over there. That’s the fourth geography. And we will look at projects specific, especially relating to factories, wherever such project comes. However, the quality of the client will be of paramount importance.
Amit Agicha
Thank you. It was helpful. All the best for the future.
Operator
Thank you. The next question is from the line of Rajesh Jain from RK Capital. Please go ahead.
Rajesh Jain
Thanks for the follow-up. I just want to understand, on the raw material pricing, like if the raw material prices increase, then will you have to absorb the entire cost or some of it is passed through in your contracts?
Rohit Katyal
In private sector, it’s full pass-through. In the government sector, all projects have price variation clauses, which is commonly known as escalation clauses, which cover up for price increases, all right, whether it is material or labor. So this is the protection which any contractor keeps when bidding for government projects and/or private sector projects. So answering your question, that we have adequate cover for increase in prices. If the prices decrease, obviously, money will — the client will take away that decrease. So as I have repeated in the past, our orders are not speculative in nature.
Rajesh Jain
Okay. So this pass-through and the escalation — pass-through in the private sector and the escalation clauses in the government sector, this is a delay of like one quarter, two quarter? How does that work?
Rohit Katyal
It is not a delay. It is at the end of each quarter. So basically, whatever work we did in quarter two will get billable in quarter three. So to that extent, there is an overlap. But then that is only an overlap of one quarter, which continues then.
Rajesh Jain
Okay, sir. Thank you so much.
Operator
Thank you. As there are no further questions, I would now like to hand the conference over to Mr. Rohit Katyal for closing comments.
Rohit Katyal
I would like to thank all of you for joining us on this call today. We hope we have been able to answer your queries. Please feel free to reach out to our IR team for any clarifications or feedback. Thank you, and have a good day.
Operator
[Operator Closing Remarks]