Engineers India Limited (NSE:ENGINERSIN) Q2 FY23 Earnings Concall dated Nov. 10, 2022
Corporate Participants:
Shri Sanjay Jindal — Director of Finance
Sun Ducati — Company Secretary and Investor Relations
Aman it Sing Chopra — General Manager, CMD, Office and Investor Relations
Analysts:
Saket Kapur — — Analyst
Fries — — Analyst
Nimish Maheshwari — — Analyst
Ashwin Sharma — — Analyst
Amit Manwani — — Analyst
Ana — — Analyst
Ash — — Analyst
Numis — — Analyst
Presentation:
Operator
Good afternoon participants. Welcome to the Engineered India Q2 FY 2021 Earnings Call. From the management today, we have Mr. Sanjay Jindal, who is the Director of Finance; Mr. Sun Ducati, Company Secretary and IR; Mr. Phil Batra, Executive Director, F&A and IR; Mr. Sunil Saksena, Executive Director, Technical and IR; Mr. Aman it Sing Chopra, General Manager, CMD, Office and IR; Mr. Vivek Mita, General Manager, Marketing and IR; and Mr. Ms. Niha Dula, Senior Manager, Company Secretary and IM.
Sir, I would request to give us some opening remarks, post which we will open the floor for a Q&A session.
Shri Sanjay Jindal — Director of Finance
Okay, sure. Good afternoon, everybody. We have declared our half year ended result for the financial year 2022, 2023. On 9th November 2022. With respect to financial performance for the half year ended 30th September 2022, the company has raised a tenor of INR1,587 crores in comparison to INR1,483 crores for the last half year ended with an increase of 15%. In the current quarter, the company has achieved a of INR346 crores in the consultancy and engineering segment and INR436 crores in the Trunk business segment.
There is increase in other income, primarily due to dividend income earned by the company on the investment made in NomalikaRefinery Limited and its subsidiary — during the current quarter, the company has a profit before tax of INR102 crores in comparison to INR68 crores in the last quarter, which is INR170 crores for the current half year and INR205 crores for the previous half year ended. With increase in profits, EPS has increased to INR1.51 per share for the current quarter in comparison to the EUR0.9 per share in the last quarter and INR2.41 per share for the current half year ended at INR2.67 per share for the last half year.
Okay — now you can start now you answer answers…
Questions and Answers:
Operator
Sure, sir. Thank you so much. [Operator Instructions] We will wait till the question queue assembles. Yes. We have the first question from Mr. Saket Kapur. Please note ask your question.
Saket Kapur — — Analyst
You can hear me, sir? Sir, firstly, if you could mention what was the dividend from the malignant for the second quarter, how much we have received as dividend Out of the INR65 crore other income, which we have booked for the quarter?
Shri Sanjay Jindal — Director of Finance
In this quarter, we have received dividend of INR35 crores, and Numaligat refinery have declared dividend of INR1, INR6 were in time for the current year and INR5 for the last final year — final dividend of the last year. And total dividend is INR35, out of which INR3 crores pertains to CL and balance INR32 crores from Nomalicatofinery Limited. And let’s give you good news also. Yesterday, there was AGM alike refinery Limited, and they have declared bonus of 121 share.
Saket Kapur — — Analyst
Sir, out of this total INR93 crores, which we have received for the first half, what would be accretable to Manian? Yes, the Malaga refinery, we have received total INR35 crores as a dividend.
Shri Sanjay Jindal — Director of Finance
Mr. Ginde, Director of Finance role, we have received INR11 per share dividend. Out of that 5 is the final dividend for last financial year and the current year financial year interim dividend. Yes, we are having a INR3.21 crore equity shares and multiple by 11 — it works out to be around INR35 crores.
Saket Kapur — — Analyst
So out of this INR93 crores, INR35 crores is from this novice finery itself and the balance part, sir?
Shri Sanjay Jindal — Director of Finance
Bala from the — basically, we are having the deposit of around INR1,100 crores. So we are earning interest on that. Majorly, that partly contributed by the balance contributed by the deposit interest rate plus certain foreign exchange variation is also there. Plus we have given certain extra space for the rent. That part also contributed to the other income. Majorly, it’s a dividend plus interest income.
Saket Kapur — — Analyst
And sir, what is the outlook for our RamagundaPartilizer unit, sir? How is that performing? Because on a quarter-on-quarter basis, the share of profit and learn from the JV, we again posted a loss of INR10 crores for this quarter.
Shri Sanjay Jindal — Director of Finance
Avesta Kapur, actually, this plant was shut down in the month of September, and it was under Charul shutdown for the preventive maintenance. As in the fertilizer industry, there are Sudurmaintenance for the plant, which could not be taken for a longer period. So it was finally decided to have shut down in the month of September. So practically, there was no production in the month of September and now the production has already started in the third quarter. So we are expecting a good profit in the third quarter.
Saket Kapur — — Analyst
And sir, taking into account Bpost this shutdown, this was a planned maintenance shutdown…
Shri Sanjay Jindal — Director of Finance
This was planned shutdown. Yes.
Saket Kapur — — Analyst
So going ahead, what will be the efficiencies we are going to benefit from this shutdown and how is the production going to shape up?
Shri Sanjay Jindal — Director of Finance
After shutdown, we are expecting 100% production at 100% capacity. And this plant is going to be dedicated to the nation by the oral Primister of India on the 12th of November itself.
Saket Kapur — — Analyst
And sir, on the subsidy part, since I think so we are only manufacturing urea. So we are seeing in other — the furniture companies also that there is a pile up of subsidiary that is — there is a delay in subsidiary release. So can you quantify what is — how is the delay in subsidiary going to affect the performance for our — this company going ahead?
Shri Sanjay Jindal — Director of Finance
Actually, the FCL bicoli company — so balance sheet to — so pilot planning. It was subsidy count, we could file up. So we are making recently Bajataria Monte government need monolith Akio Hamari subsidy Pillar for okay? So Pilar, for the current financial year, we are not worried about the subsidy part.
Saket Kapur — — Analyst
Just the core business pace in regard Alent CASA Baker as had our H2 plan other way in terms of execution and in terms of our margin profile, especially on our main buyer business, that is the consultancy and engineering project business, our CASA business outlook breaking ahead there.
Shri Sanjay Jindal — Director of Finance
Definitely, tea, we are running 95% from our core sector, and this turnover from the core sector is from the domestic market as well as from the foreign market. And recently, we have got our from the — we have got PMC job from the new territory that is Gina. So we are expanding geographically also. So — and we are getting strength in Middle East region also, we are trying to get more business in that reason. And recently, we are trying to get in Saudi Arabia also. So we are focusing on the core strength. Definitely, we are focusing, and we are expanding into new geography also. So we are very confident on the core sector, and we still maintain that we will — we continue to run good profit or good segment profit from the engineering consequences.
Saket Kapur — — Analyst
Sir, going ahead for H2, so can you give any ballpark number? What kind of execution are we going to do in terms of the trunking project and the consents business or a business growth idea if you compare the last two with this year is to what kind of growth can we anticipate?
Shri Sanjay Jindal — Director of Finance
Growth, we have already seen growth in our terminal. In the first half year, we have already turned our increase of more than 50%. And on the annual basis, we are also expecting growth in the annual turnover by 15%. And we are still — and we are targeting the profit of INR340 crores, which was our last year figure out so. So we are very hopeful to touch all these figures.
Saket Kapur — — Analyst
Okay. So last year, we had a PAT of INR343. This year also, we are anticipating to…
Shri Sanjay Jindal — Director of Finance
This year, we are also optimistic about that magic figure, and we are trying hard to achieve that figure. And we are sure we will achieve that figure. Because we are working with Chanel, we are working with our clients for the change orders, and we are working with our clients for the new orders also. And we are very optimistic to achieve that…
Saket Kapur — — Analyst
Okay. Correct. Sir, lastly, sir, taking into account the shareholder value creation idea, sir, how — so there is — we can understand that there is lesser interest in EPC consultancy firms and especially being backed by government also having the sovereignty also, we are not getting the right valuations — we are having cash and bank balance in books. We are having a strong order book, good execution skills, good track record. But still, the capital market does not — is not providing any — it’s not giving the right P ratio on the right valuation. So what — what are the other steps in which the management can contemplate in terms of buyback or other ways by which you can increase your shareholder value that has remained depressed over a longer period of time, sir.
Shri Sanjay Jindal — Director of Finance
First of all, I must say we are already paying a good dividend to our shareholders. And in the last 10 years, we have already paid around a 95% dividend to our shareholders. In addition to that, recent-recent buyback was done in the financial year 2020 and 2021. And in the current year, we are not targeting any kind of buyback share again is way of dividend, we are rewarding our shareholders already. So I don’t think a shareholder must be worried about the dividend in the India Limited. We have a good track record of dividend in the company.
Saket Kapur — — Analyst
I’ll come in the queue, sir. Thank you for the answer.
Shri Sanjay Jindal — Director of Finance
Thank you.
Operator
The next question is from Mr. Fries. — Please, go ahead and you can ask your questions.
Fries — — Analyst
Thank you so much for the opportunity. I just need a clarification regarding — you have mentioned that we are expecting growth of 15% with a profitability of around INR340 crores, which is based on the stand-alone level or consolidated, sir?
Shri Sanjay Jindal — Director of Finance
It is stand-alone business. Mr. Kunal, please check the line.
Operator
Yes. I think he’s unaudible again.
Shri Sanjay Jindal — Director of Finance
Can we go to next investor call. I think it’s not only line…
Operator
The next question is from Nimish Maheshwari. Please Aidan ask your questions…
Shri Sanjay Jindal — Director of Finance
Yes, Mr. Maheshwari?
Nimish Maheshwari — — Analyst
Hello, Sir, my question is related to order book. So we have seen a degrowth in the Q-o-Q basis on consultancy as well as turnkey. So what is your view on that side?
Shri Sanjay Jindal — Director of Finance
On the turnout part you are asking?
Nimish Maheshwari — — Analyst
It’s a complete order book. So the numbers are like INR4,693 crores, which gone to INR4,599 crores. Cumulative order book. Yes, yes. So the split of consultancy, which I’m talking…
Shri Sanjay Jindal — Director of Finance
Okay. Actually, yes, our consistency order book was INR4,029 crores on 31st March 2022, and it is reduced to INR3,779 because some part of the order book, we have executed in the first half, and we have got new orders also, and we are working with our clients for the new orders, and we hope that the order book will be strong at the end of financial year. And definitely, our financial order book will be strong.
Nimish Maheshwari — — Analyst
Okay. So expect…
Shri Sanjay Jindal — Director of Finance
So in this order book, we are going to target around INR4,000 crores to INR res 4,000 crores as an order book and the total order under this project are under this are in this financial year, out of which we consider that around 600 should be from the consultancy and balance we will try from the EPC or LSTK basis, we are targeting various OBO projects and EPC projects. But very focus is on the consultation services, wherein BC around 600, 300 in balance, we’ll try to achieve when secure through the OP, which we are pursuing with various clients.
Nimish Maheshwari — — Analyst
So you are targeting around — so currently, it is — the minor order book is INR8,430 crores. Great.
Sun Ducati — Company Secretary and Investor Relations
Yes. He is saying that we are targeting new orders to the tune of around INR4,000 crores during the current fiscal autothatround INR1,516 crore from the consultancy segment and balance in the LSTKsegment. 4,000 new additions.
Shri Sanjay Jindal — Director of Finance
Yes. We are targeting that for — during the crude.
Nimish Maheshwari — — Analyst
You’re working towards this. Let’s hope for the best. We meet it.
Shri Sanjay Jindal — Director of Finance
And so far, we have received order of INR515 crores.
Sun Ducati — Company Secretary and Investor Relations
No, around INR800 crores…
Shri Sanjay Jindal — Director of Finance
INR800 crores.
Sun Ducati — Company Secretary and Investor Relations
Yesterday, we have reached INR886 crores. You know that our recent addition of Guyana job, which is a major job, which we have received outside Indian territory. It is received yesterday, day for yesterday only yesterday evening, only, it has been declared. So that’s a base achievement. And now we’ll be targeting more projects in that territory also.
Shri Sanjay Jindal — Director of Finance
Okay. So first half is the total new business secured is INR565…
Sun Ducati — Company Secretary and Investor Relations
No, as of yesterday…
Shri Sanjay Jindal — Director of Finance
It is more than INR800 crores.
Sun Ducati — Company Secretary and Investor Relations
No, no. For the first half, definitely, whatever you are saying is correct. But as of date, we are saying that we have order — received orders more than INR800 crores. Out of that, around INR250 crores in the EPC segment and balance in the consultancy segment.
Nimish Maheshwari — — Analyst
Good sir. Got it. And the other question is related to our split of revenue. So in the first quarter, we said our anestic revenue is higher. That is the reason of the fall in the profits. But in this quarter also, we have seen that the consulting revenue is a bit lower from the — even the previous quarter. So what is the reason why we are not getting the consulting revenue higher side? And what is your view on that side?
Shri Sanjay Jindal — Director of Finance
The major difference is on account of change order because in the previous year, in the first half year, we were having can order to the tune of INR60 crores, out of which INR50 crores was attributable to the net profit. But in this financial year, we are finalizing our change order with the clients and it is in the pipeline, and we are expecting to realize it soon. And whenever our change order realizes, at major portion will contribute to profit since we have already incurred the expenditure. So this is the reason because as you know, project industries are cyclic to industry. And there may be a fluctuation from the first quarter to second quarter. But we are — on the annual basis, we are expecting to increase our — to achieve over all the targets.
Nimish Maheshwari — — Analyst
Sir, can you explain a little bit more why the consulting revenues are not catching up because if we can see that in like FY 2020, FY 2020, the old numbers in all quarters are higher than 350. So what is the reason we are unable to catch up that?
Shri Sanjay Jindal — Director of Finance
Yes. Mr. Jindal told that normally, we used to receive the change order during every quarter, that range from INR20 crores to INR30 crores. So during the first half year of this financial year, we have not received any change order from our client, although we have submitted our canoer, that are under finito. That’s why there is no incremental revenue in comparison to the last financial year. So going forward, we are expecting that certain change orders will materialize with our clients, and we expect to receive those in order, and that will state way go into the turnover and maximum portion will contribute to the profits. So as such, there is an incremental revenue there, but due to known Cochane order, that is not showing in our results, basically.
Nimish Maheshwari — — Analyst
Got it. Got it, sir. So one more question on the guidance. I mean, you are guiding about INR300 crores to INR350 crores of PREPA. So is it on stand-alone side or console side?
Shri Sanjay Jindal — Director of Finance
Yes, Linda already told that that is on the stand-alone basis.
Nimish Maheshwari — — Analyst
Okay. And the the RCL JV, what we are expecting, is it profitable in the upcoming half year or some other stabilization issues will remain there?
Shri Sanjay Jindal — Director of Finance
No, all these stabilization issues has been already addressed and the plant was under a planned shutdown in the month of September. So there is some loss in the second quarter. But this — in the third quarter, this plant is already under operation, and it is working at more than 80% capacity. And soon, it will manufacture at the 100% capacity. And this plant is going to be dedicated to the nation by our honorable Prime Mister on 1 number itself. So we are very hopeful about the profit in the third quarter item.
Nimish Maheshwari — — Analyst
So sir, how much profit we are expecting from the all JVs and the one you can define the RFC and other JVs. — how much pad we can expect in the next half year?
Shri Sanjay Jindal — Director of Finance
Okay, in the NRL project, we are getting dividend. And we have already received a dividend of about INR35 crores from the malice refinery. And right now, we do not have any figure about the RSL project. And so I cannot comment on the RSL profitability at this moment because the plant is under opposition. And I can assure you, at this time, there will not be a loss in the RF project.
Nimish Maheshwari — — Analyst
Okay. Coming back to you — thank you so much.
Operator
Next question is from Ashwin Sharma. — please on me word and ask you questions. the next one. is, you can ask your question.
Ashwin Sharma — — Analyst
Yes. Am I audible now, sir? Yes. Yes. Sorry, the previous call was is currently due to network issue. So you just have mentioned that we are targeting around INR40 billion of order inflow in financial 2020. Can you explain the — what kind of order inflows are we getting in consultancy as well as in project segment? And also, what kind of order pipeline are we seeing in financial year 2024 as well in consultancy and PC…
Sun Ducati — Company Secretary and Investor Relations
I would like to take that answer. Gentlemen, we — you know that there are a number of — since this post Covitect there were a lot of projects were on hold. A lot of investments are coming in. Government is also pushing a lot of investment. So we have been working on various projects, which are there in the refining sector as well as in the petrochemical sector. Various petchem projects, which we emphasis in the course this factor, the end of this financial year or the next financial year, wherein we would be targeting either PMC, EPCM services or the EPC services. So there a lot of projects are lined up, and we have worked on also on those projects to DFR.Sowe know that for sure, these projects are viable.
So these are there, like some projects out there of the IOC some of the projects are there of the BC ONGC has signed up future projects. There are a few private clients also setting up various petrochemical complexes. So we are all engaged with all these clients and focusing on those projects. So some of the will realize in this year or some of them will go towards the next year. Basically, we are in the some of the proposals we are in the process of negotiation also with them. So we see there are positive things ahead…
Ashwin Sharma — — Analyst
Are you online? So can you quantify the order pipeline for the same that you just mentioned?
Sun Ducati — Company Secretary and Investor Relations
Order pipeline. I mean that we are targeting around INR4,000 crores from the overall business, out of which around INR1,600 crore or INR1,700 crore, maybe from the consultancy and balance will drive from the OC, EPC. So that’s the target right now, we have kept. And we can always improve the situation as and when we get more jobs. We’re working towards it. We are putting very strategically. We are trying to get the — we’re working with the clients. And one of the success is the new treetory, we have recently been awarded a bases assignment. And you must have heard about various petrochemical assignments have been awarded in the last year with us. So let’s hope for the best. We are working towards it.
Operator
The next question is from Amit Manwani, please ask your question.
Amit Manwani — — Analyst
Thank you. My question is with regards to green hydrogen. We have been talking about nitrogen in the past couple of quarters. And I think there was some pilot which was going out with one of the OEMs. So any development on the green hydrogen side and you have thoughts on EL investment strategy or capex on green hydrogen for the next couple of years.
Shri Sanjay Jindal — Director of Finance
Mr. Aman Prith will apply this part…
Aman it Sing Chopra — General Manager, CMD, Office and Investor Relations
So on the green hordes side, there are a couple of projects that we are already executing. And moving forward, we are undertaking a lot of studies with our clients because there is guidelines for having a green hydrogen percentage of green hydrogen in the process plants. So we are engaging with our clients to see that what major interventions that we can have together both on the technology side and both on the business side so that they can achieve their green hydrogen targets.
So as you know, that this is a very nascent phenomenon. And we, as a technology company, are working not only with our clients but also with the technology providers across the globe. We are engaging with them so that we can have some discussions so that the technology can be implemented in our process plants. So all these aspects, we are working very closely with our clients and our technology providers.
Sun Ducati — Company Secretary and Investor Relations
I would like to add on this like right now, we are already executing 3 or 4 assignments. One is with Gale, wherein we are working on the feasibility of injection of the gas in the 5% or I think some percentage of the hydrogen in the existing gas network. One, we are starting with respect to one of the area, which is being done by NSIDC,Sthink that zone and studying the viability of the hydrogen projects in that zone, that study we have completed. Another is we are doing it for one of the clients like Adani — it’s for the private sector, where we are working on the study.
Basically, it’s a detaining and study as well as engineering for the transportation of hydrogen line. And we are in discussion with various clients on these kind of scenarios like green ammonia, green urea, transportation of the hydrogen, hydrogen plants, balance of plants of hydrogen. So on various proposals, we are working, including the public sector clients also.
Aman it Sing Chopra — General Manager, CMD, Office and Investor Relations
So I would like to add because this green hydrogen is a very nascent stage of the comment in the country. So we are — so the ecosystem has to be developed for the exhibition part. And as we are very deeply into this particular green hydrogen right from the start, we are expecting that whatever the opportunities that will be coming in this particular domain will be at a front runner to grab those opportunities.
Amit Manwani — — Analyst
Okay. So sir, any thoughts like we will be doing green hydrogen EPC or manufacturing of products required for green hydrogen manufacturing or you’re going to do build, own, operate…
Sun Ducati — Company Secretary and Investor Relations
Yes. Actually, all these — actually, whatever we say that this is a very nascent — all these projects are in very nascent stage. — hardly any project has come in a big way, in a commercial way. So we will just get involved in the initial studies and equates with the technology because this is a new area. Even technologies are limited and the exposure to the technology is very important for execution of any of the projects. means if you take any of the assignment as an EPC, you have to understand the complete know-how.
Like in refinery, we know everything. But hydrogen is a new area. We are learning their technologies by way of getting involved in the initial studies, engaging with the licensors. So I think initially, we — maybe in this year, we will be focusing on the studies and the engineering services. And maybe next financial year, we will try and see that if something works comes and we are able to go for that and how much risk we can absorb.
Operator
Thank you, Amit. The next question is from Ana — please go ahead and ask you questions…
Ana — — Analyst
Sir, you mentioned certain projects like from IOCL and ONGC where you are expecting certain orders to come in. So could you please talk a little bit more further as to what is the scope of work that we are looking at these orders? And also, if you could share some potential size of the key major orders as to what are the large orders and what is the scope of work over there?
Sun Ducati — Company Secretary and Investor Relations
The scope of primarily is either the PMC or EPCM services. These are mostly the hybrid projects wherein some of the units are executed on the project management mode and some of the units are executed on EPC mode. We have bidded those, and we are still waiting for the offers have been submitted. And let’s see, is hope for the best that it will come to us. So some of them are in range of 4,600, 3,000, 5,000 right now in these ranges.
In the course to come in is towards the end of this financial year or the next financial year, there will be larger projects. We are expecting from all these oil companies, wherein the investment would be higher. And again, we will be first prime FSI focusing on the PMC, EPCM, and maybe — and if it’s found suitable, we can also go for the EPC.
Ana — — Analyst
Okay. So sir, what would be as in for FY 2023, you mentioned an order intake of around INR4,000 crores. And over next year or next two years, 24, 25, what would be that ballpark number?
Sun Ducati — Company Secretary and Investor Relations
Let’s say, this is around INR4,000, and we can perceive that it could be in the range of INR4,500 to INR5,500. We will gradually improve, and we will keep on improving these figures. Let’s say, around INR4,000 — I mean 4,500 to 5,000, we can anticipate in the next year.
Shri Sanjay Jindal — Director of Finance
Mainly, we are targeting of INR5,000 crores in next two years each year. On a yearly basis, we are targeting around INR5,000 crores addition in the order book.
Ana — — Analyst
Okay, sir. And sir, for FY 2023 in the execution terms, what would be the proportion of consultancy to EPC?
Shri Sanjay Jindal — Director of Finance
And I think it will be around 45% to 55%. 45% would be on account of consultancy job and 55% turnout will be contributed by 20 segment.
Ana — — Analyst
Okay. Sir, any further details you want to give about the Ghana project that we’ve done day before yesterday in terms of margin profile, that being an export order. So what — where would be the margins lying related in terms to our domestic consultancy orders?
Shri Sanjay Jindal — Director of Finance
Your margin will be in the line of the domestic consultancy rather more than the domestic concurrency. So there will be a good margin in that particular file.
Ana — — Analyst
And sir, in that target, maybe for FY 2023 or 2024, either you can give, what is the export like orders like the one we got from Guana that we are targeting?
Shri Sanjay Jindal — Director of Finance
Yes, we are targeting a few orders. But right now, we cannot disclose what will be the percentage and what would be the quantum of those orders.
Ana — — Analyst
Okay. And sir, one last question from my side. Currently around what we were reading around 55% of the ordering has been done. So in addition to the large INR4,000 crores kind of an EPC order that we are already executing, are we expecting any follow-on orders from that?
Sun Ducati — Company Secretary and Investor Relations
Sara, in case of SRL, I think we are working on some of the change orders. We might — we are expecting something in the next financial year. We cannot tell you the value right now, but we are working towards that. There is some change order we are envisaging. A good value would be there. This is a very big refinery. So change order to be materialized over a period of time. So going forward, maybe next financial year or 24%, 25%, we may get from change to that account. But it’s a very big refinery. So the settlement of change also will take time.
Ana — — Analyst
Okay. And that would be largely in the EPC mode.
Shri Sanjay Jindal — Director of Finance
No, no. It can be both, basically, we are doing the PMC elite EPC. So a change order can be on the both accounts. In the Barmer refinery, we are working under both methods. We are working as and we are working as a Trunki contractor also. And we are expecting chain order in the both segments. — old earlier, we are working closely working with our clients for Diodes and admire find is one of them.
Ana — — Analyst
Okay, sir. And sir, any update on the Ratnagiri refinery project? Is it being revived or any update on that…
Sun Ducati — Company Secretary and Investor Relations
Stake in the process. we get a concrete information, we cannot say anything because — we — our teams are working on the EIS. They have been changing location a number of times. So nobody can all say that for sure.
Ana — — Analyst
I have a question. My question is pertaining to the INR5,000 crore top line that we were targeting or the next one or two years. So just wanted to get your views on — are we on track to achieve that? And also, if you can speak about the non-oil and gas initiatives that we are taking and what is the share of nonoil and gas initiatives that we target over the next two, three years?
Sun Ducati — Company Secretary and Investor Relations
Going on the INR5,000 crores, we are working towards it. Mostly, it would be like what sees the finery sector is still going to prevail. The demand is going to increase, and we anticipate there’s a lot of demand in petrochem in refinery as well as most of the refineries are going towards the petrochemicals. So we are working on a list of the projects is mostly all the foundries and petrochemicals have thought about the going to petrochemicals.
So those projects are already lined up because we — in most of the projects, we have worked on the DFRs also, so we can see that there is a probability that these projects would come, may not be this year, towards the end of this year or next year. So those projects are there for — and those have been accounted for or calculating this INR5,000 crores. Going towards the other sectors, it’s always been traditionally, we have been getting around 15% to 20% from the other sectors. In the other sectors, you know that we are working in the Sunrise sectors and one is hydrogen, I told you, we have started getting the jaws.
We have worked in coal gasification. Recently, we have been awarded on assignment from Neville Corporation for a whole gasification product for preproject activities. Similarly from the Coal India, we have received one of the S. So we are also working towards the coal gasification. Then next is we are also going towards the waste to ethanol and based ethanol projects in steel sector. So we are engaged — we are getting engaged with a few of the clients and trying to explore that possibility that we can get into that segment. So these are the new segments which wherein we are there. Apart from that, we know that we are already there in the infrastructure.
In infrastructure, we are working on various data center projects, and we are anticipating various data center, our data center projects in the next financial year. There is one project with respect to international market development in Haryana. — there’s a project from Harticulture. There’s SBI data center. A lot of projects of this sort. There are various institutional building projects wherein we have worked earlier are going for the Phase II of care expansions on addition of the hostels and totes. We are also targeting those projects — we have been into airport last year, we have been awarded the airport in the study for the airport in Noida, Greater era, similarly using that as a leverage for we are targeting a…
Ana — — Analyst
Sir, I have a couple of questions regarding your execution. First of all, sir, I just wanted to know the quantum of this change order what you mentioned. Is it somewhere around INR60 crores, you said…
Shri Sanjay Jindal — Director of Finance
Yes, that was in the in the last financial year, rather last half year of last financial year. Yes, we received during the… Year ended half year ended… September…
Ana — — Analyst
So that change or — so this year, how much of the change orders you are expected to receive?
Shri Sanjay Jindal — Director of Finance
Key chain order, how many already opening client call submit. Unless until it is finalized by the client, we cannot disclose because we are not also sure how much client will pass. Definitely, our figure is bigger than INR60 crores. But I cannot ensure you what kind of figure it will be finally…
Ana — — Analyst
It’s then INR60 crores, but I expect current INR60 crores cash part, how much…
Shri Sanjay Jindal — Director of Finance
I’m not saying bus like this. Figure of INR60 crores was in the first half year of the financial year 2021, 2022. 60 crore figure financial year 2021, 2022 first half year, Kelly, — our profits are higher because of then orders, so tune of INR60 crores. But this figure, I have not quoted for this year. And for this year, we are closely working with our clients for our then orders, and I cannot commit any figure because of an order and under process, and I cannot comment on behalf of clients, how much they will pass…
Ana — — Analyst
Okay. And sir, regarding your execution in PMC, what I see that from FY 2014, bottom of INR1,500 crores of order book, your PMC order book has successfully increased and it has reached to somewhere around INR5,000 crores now. But your revenues are not picking up in that way, like your revenue in that year of FY 2014 was somewhere around INR1,200 crores, and it has is to only about somewhere INR1,400 crores to INR1,450 crores. So actually, exits PMC is coming down. So is there any fundamental reason getting that…
Shri Sanjay Jindal — Director of Finance
No, no. There is no fundamental reason for that. Basically, these are long gestation projects with the project schedule of three to four years. So whatever is the order book that is executed over a period of three to four years. And that also during the first year, the execution is between 5% to 7% in the second and third year, the maximum activision takes place. And in the fourth year, the balance sheet being executed. So if you can sit by order book of INR4,500 crores.
So that will be executed over a period of 3.5 years or four years. So taking that into consideration that our order book is around 4,600 as of date. So that will be executed in a period of around three to 3.5 years to four years. So taking that into consideration, our revenue is in line with the over period for that particular project. So going forward with the increase in the order intake, definitely, our order book will improve and the revenue will also improve…
Ana — — Analyst
Okay. And sir, in your Elastic, your margin has also structurally come down like it used to be somewhere around 10%, 12%, it has come down to like 2%, 3% now. So going forward also, will it reverse to an extent or it will be in this range…
Shri Sanjay Jindal — Director of Finance
Yes, the margin is expected to — taking into consideration the nature of the jobs, what we are doing as of now, basically, these are offsite and utility projects. So we’re — and these are the cost plus project. We are not taking any risk in case there is an increase in the platination contract cost that will be passed on to the basically client. So our margins and risk are protected. So taking that into consideration, we are expecting the margin in the tune of 3% to 4% only.
But in case after the completion of the project in case any anti-gray we are also making provision for the renting case, we’re integrating denote comes, then the margin will improve in that particular quarter or that particular financial year. Going forward, we are expecting based on the current order book, the margin should be in the range of 3% to 4% only. But in the completion of that project when the defect liability period over, we may get extra margin.
Ana — — Analyst
Okay. And one last question. Sir, in this PMC, like first half margin was somewhere around 18% to 19%. But I believe it is because of some cost increase in some product projects, which you are saying that you are playing to the customer. So in the second half, we can expect that your margin in the PMC will normalize to somewhere around 28%.
Shri Sanjay Jindal — Director of Finance
Yes. We cannot say the percentage at. We will definitely try to improve that in case certain change orders are material that will contribute substantially to the profitability and the turnover of the company. We have already taken up with the clients for the change order that are under finito. If those changes are finalized during the next half year, definitely, there will be improvement in the margin as well as the turnover will improve in comparison to the customer.
Ana — — Analyst
Thank you…
Operator
The next question is from Ash. You can ask two questions.
Ash — — Analyst
Hi. I just wanted to understand what is the addressable market for coal gasification today that is there in India. So currently, we are executing a consultancy project with Nabil. So apart from maybe who are the other players that today are investing in the same space?
Sun Ducati — Company Secretary and Investor Relations
Ma’am, you must have heard about the recent MOUs between the Coal India and Indian Oil, Gale, DHL as well as NLC and BHL. All of them are going for these coal gasification projects. Apart from that, JSPL is also going for the coal gasification — so in this, we see, as per the information, the surface full gasification would have an investment of somewhere around INR35,000 crores in the due course. And ministries are also pushing towards this and various studies have been done on this. So we see good chances that many of these projects would realize.
Ash — — Analyst
And sir, this INR35,000 crores is over a period of what…
Sun Ducati — Company Secretary and Investor Relations
That next four, five years, six years and the project is installed.
Ash — — Analyst
Okay, sir. And you want to speak about the waste to ethanol on this mill.
Sun Ducati — Company Secretary and Investor Relations
These are basically the initial… We are trying to engage with some of these companies with respect to this. And initially, we have done few DFRs also for — we are just trying to see that whether it can be implemented in some of the steel plants. So we are trying to engage with one of the licensors and then trying to get in touch with the steel companies. We’re working towards it. We have not got successful in this, but we are working towards it. So we are hopeful that we might be successful in deport.
Ash — — Analyst
Got it. Yes, sir, addressable market, if you could speak about for waste to ethanol or that’s an initial stage?
Sun Ducati — Company Secretary and Investor Relations
In the initial sale. Let’s not think the names of the companies. We’ll let you know in due course if something happens.
Shri Sanjay Jindal — Director of Finance
Thank you, Ash…
Operator
Next question is from Numis. Go ahead and ask your question, please.
Numis — — Analyst
Thank you for the opportunity. I just want to a view on the EBITDA margin. Can you hear me?
Shri Sanjay Jindal — Director of Finance
Yes, EBITDA margin, we have already sold that going forward in the next half year, we are going to improve the margins in comparison to whatever we have achieved in the first half, taking into consideration the better execution as well as the change order, which are being spending with our grids. So taking that into consideration, we expect to improve the EBITDA in the next half.
Numis — — Analyst
And one more thing I just want to ask, in the P&L, there is a construction material. What does it include? And why there is an increase in this quarter? Because if we can see in the previous year second quarter, that is only 47 and it increased to INR164 crores. So I just wanted to understand what is the construction material includes — and why it is increased.
Shri Sanjay Jindal — Director of Finance
Yes. Basically, it dependent on the Trunki turnover. It’s a part of the cost of the trunk segment. In case there is increase in the turnover in the EPC segment, the corresponding cost will also increase. You can see the last financial year, the EPC turnover as well as the EPC cost. So with the increase in the turnover in the EPC segment, means trunk segment, there will be an increase in the cost. That is directly proportional to the increase in the turnover for the EPC.
Numis — — Analyst
But I think in the last call, you said about technical assistance is the key relation have…
Shri Sanjay Jindal — Director of Finance
You have to take into consideration both the component. One is the subcontracting, other is the construction material. — technical systems of subcontract plus construction material equipment, D2 costs are directly proportional to the EPC turnover. In 1 year, one may be less, there will be more depending on the cycle of the execution of that particular project.
Numis — — Analyst
Got it. Okay. Is there any doubtful debts? And is there any provision in this quarter?
Shri Sanjay Jindal — Director of Finance
Well, definitely, there are provisions for the IndAS, we are making the provision depending upon the — basically the period of the outstanding of the debts. Those provisions are made for the IndAS and are reviewed at every quarter. During the current quarter also, we are having a provision of around INR2 crores to INR three crores not material in comparison to the last financial year. You just see our debt position that is almost as of 31st March 2022, whatever the debt right now, also, we are having the same debt. So the provision is less in comparison to the last quarter for that outward, but that is a very scientific way in the quarters with that, we are making the provisions.
Numis — — Analyst
Got it. Is there any other investment opportunity which company is thinking because we have a lot of cash in our balance sheet. So is there any opportunity which — which are in the discussion?
Sun Ducati — Company Secretary and Investor Relations
See, we are looking on a couple of opportunities, but this is not the right time where we can disclose this. There are a few things that are going on, but it has not reached that stage where it can be declared.
Numis — — Analyst
Okay. So is it related to government projects or any other projects…
Sun Ducati — Company Secretary and Investor Relations
It’s both.
Numis — — Analyst
Okay. Okay. Thank you so much.
Operator
Thank you.
Shri Sanjay Jindal — Director of Finance
Yes, Mr. Kunal.
Operator
We have, sir, last question from Masha sir, go ahead and ask your question… I think Masha moved out of the question queue. So we don’t have any further questions, sir. Sir, would you like to give any closing comments?
Shri Sanjay Jindal — Director of Finance
Thank you very much, Mr. Kunal, and we are very sure we will achieve our targeted figure in the balance half year, and we will achieve our target. Thank you.
Operator
Thank you so much for your opportunity. Thank you so much. And best of luck.