Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
GE Vernova T&D India Ltd (NSE: GVT&D) Q4 2026 Earnings Call dated May. 19, 2026
Corporate Participants:
Megha Gupta — Investor Relation
Sandeep Zanzaria — Chief Executive Officer
Abhishek Srivastava — Head Business Operations
Sushil Kumar — Chief Financial Officer
Analysts:
Unidentified Participant
Parikshit Kanpal — Analyst
Umesh Raut — Analyst
Mahesh Patil — Analyst
Mohit Kumar — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to conference call hosted by GE Varnova TND India Limited for quarter four of financial year 2025 26. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this call is being recorded. I now hand the conference over to Ms.
Megha Gupta from GE Vernova TND India Limited. Thank you. And over to you.
Megha Gupta — Investor Relation
Good evening everyone. Welcome to the G1 Nova TND India Limited earnings call for quarter four of financial year 2425 2526. I am Megha Gupta from investor Relations team. During the call I AM joined by Mr. Sandeep Jandaria, CEO and MD of the company. Mr. Sushil Kumar, Whole Time Director and CFO of the company. Mr. Abhishek Srivastava, Head Business Operations. Ms. Kanika Arora, Communications Leader and Ms. Shweta Mehta, Company Secretary in the company. Before we begin, I would like to highlight that today’s discussion may contain few forward looking statements which are subject to risks and uncertainties.
These statements are based on our current expectations and actual results may differ materially from those expressed or implied. We encourage you to refer to our public filings and documents for comprehensive understanding of the factors that could impact our future performance. Now I’ll hand over the call to Mr. Sandeep Zhansaria to initiate the discussion. Thank you. And over to you sir.
Sandeep Zanzaria — Chief Executive Officer
Thank you, Megha. Good afternoon everyone and welcome to our fourth quarter and full year earnings call. As we reflect on the year gone by, one thing is evidently clear. India’s power sector is in the midst of historic transformation. The country continues to add renewable capacity at a rapid pace. Electrification is deepening across industries and household. And the demand for a stronger, smarter and a more resilient transmission and distribution network has never been greater. The Government of India now articulated and even more ambitious long term energy vision targeting around 800 gigawatt of renewable energy capacity by 2035.
Which would take the installed base for the non fossil power generation to over 70%. This is far more than the capacity addition milestone. It is a clear signal of the scale of infrastructure build out required. In parallel, the country’s transmission network is being planned to support over 900 gigawatt of non fuel cell capacity. Underscoring the central role of grid infrastructure in enabling India’s energy transition while sustaining long term economic growth. At the same time, the broader policy and demand outlook remains highly supportive.
India’s energy consumption continues to rise driven by industrialization, urbanization, rapid data center growth, manufacturing expansion and the increasing need for reliable power across all geographies. Peak demand is on a strong upward trajectory and is projected to nearly double by 2035. As a result, the grid will need to evolve rapidly to manage intermittent renewable generation, enable long distance power evacuation and handle significantly greater complexity in system operations. What does this mean for transmission and distribution infrastructure?
It means that every megawatt of renewable capacity added, every new industrial corridor developed and every step towards nationwide electrification requires a modern, efficient and reliable network to carry where it is needed most. This is where exactly TMD plays a critical role. Our portfolio is well aligned to these structural opportunities from high voltage transmission equipment to grid solutions to digital capabilities and HVDC technologies. We remain focused on enabling India’s energy transition and supporting the country’s long term power infrastructure need.
HVDC in particular will continue to be strategically important as renewable energy is increasingly generated and resource risk but remote locations while demand remains concentrated in urban industrial and commercial centers. We also see a strong and growing export opportunity as the global market for transmission and grid equipment is expected to expand significantly. This growth is being driven by large scale utility and data center investments in the United States, industrial and renewable energy expansion projects across the Middle east, and rising demand and energy transition in other parts of the world led by renewable grid integration and replacement of aging substation infrastructure.
Our products already reach more than 60 countries across the world, reflecting the strength of our technology, quality and execution capabilities. Under our India for the World strategy, we are focused on deepening localization, enhancing competitiveness and increasing the share of hybrid value export orders manufactured from India while continuing to expand into new market and regions. Now turning to our financial performance, I’m pleased to report that for financial year 2526 was a strong year for G Vernova TND marked by healthy demand, disciplined execution and improved profitability.
During the fourth quarter our order intake remained robust reflecting the strength of market demand and continued trust of our customers. For the full year we delivered a solid performance across key financial and operational matrices supported by strong project execution and favorable market environment. Our order book remained strong in Q4 and we saw a booking of INR 86.1 billion, up by 188% year on year compared to 29.9 billion. In quarter ended March 25. Our Q4 revenue stood at 16.4 billion versus 11.4 billion, up by 42% year on year.
On a full year basis, our revenue stood at 62.1 billion versus 42.9 billion, up by 45%. Year on year, new orders outpaced revenue, further expanding the order backlog to 214.6 billion as on March 26 versus 14.3 billion, up by 49%. Our profit before tax and exceptional items for the quarter ended December was 4.6 billion. Quarter ended March was 4.6 billion as compared to 2.6 billion in the corresponding quarter of the previous financial year, growing by more than 1.8x. From a full year perspective, profit before tax and exceptional Items stood at 17.1 billion versus 8.2 billion INR, which is 2.1 times increase.
The cash and cash equivalent balance was at 25 billion as on March 31 versus 10.5 billion as on March 31. 25. The cash generated in Q4 was 9 billion and on a cumulative basis 15.8 billion during the financial year 25 26. Beyond the financial performance, I would also like to highlight the meaningful progress our teams have made in strengthening execution capabilities, enhancing customer responsiveness and building a more agile and resilient organization. During the year we initiated significant capital investment of more than 10 billion across multiple product lines and facilities.
These investments represent critical foundations as we prepare for the next phase of growth. Yesterday the Board of Directors have approved an investment of Indian Rupees 550 million towards creating new capacities for disconnectors and drives. The capacity will be established at a new facility located at Vallam, Tamil Nadu. The Board of Directors also recommended a Dividend of Indian rupees 10 per equity share for financial year 2526 Subject to shareholders approval. In conclusion, this year has reinforced our confidence in the long term opportunity ahead.
India’s energy transition is accelerating and the need for robust transmission and distribution infrastructure will only grow stronger in the years to come. Our strategy remains clear. Execute with excellence, deepen our customer relationship, drive profitable growth and continue to be trusted partners in building India and global energy transition. On behalf of the leadership team of G Varnova tmd, I would like to thank our valued customers, board, investors, partners and above all our dedicated employees for their unwavering support and commitment throughout the year.
I would now like to invite Abhishek to present operational highlights.
Abhishek Srivastava — Head Business Operations
Thanks. Thanks Sandeep. So I will take you through the key execution highlights from Q4 of FY25 26 and again these execution highlights are reinforcement of our commitment to strengthening of countries transmission Network while driving energy transition. Some of the notable successes for us in the last quarter in terms of turnkey solutions. So we commissioned Gadak Substation for our customer Renew with whom we had been partnering very actively and we commissioned 402 20kV AIs project for them at Gadak sub session.
Another key mention would be PGCR Nagaland which was a tough sub location where we commissioned 132kV GIs appreciation for them. It was done through execution excellence in a very very tough environment. Another key turnkey project which got commissioned in the last quarter was for power evacuation from NTPC Kargo. A 400kV AIs base along with 500400 MBA power transformers and then for our customer HPP TCL at the site location of Kangu we commission 220kV, 132kV 33kV AIs days along with the associated power transformer.
In addition to that we had been actively supplying our products to our customers and some notable commissioning in terms of adding further transfer transformation capacity through commissioning of power transformers and reactors that I would like to share with you all. The first one would be PGCR ranger where 9 number 80 MBR 765kV single phase shunt reactors were commissioned along with three numbers 500 MBA 765kV interconnecting transformers. Then for our customer Starlight at kishtavar we commissioned one number 400kv single phase shunt reactor PGCL Maheshwaram where we had commissioned 500 MBA transformers and 765 KV reactors and then PGCL Badla 3.
In addition to that we had been actively working in terms of commissioning our switch gears, both air and gas insulated. So we commissioned 22 number circuit breakers and 400 KV9 numbers working with our customers like Godrej. And then also at IIT Mumbai we commissioned the GIS obsession. So with this I think we had been focused in terms of improving our execution performance, completing the projects on time and to our customer satisfaction, which is our continuous endeavor and improving the quality of execution and all that we do.
So with this I would like to hand over to Sushil.
Sushil Kumar — Chief Financial Officer
Thank you Abhishek and good afternoon everyone. It’s a pleasure to review what has been a transformative year for GE Vernova TND Intellective characterized by record order intake, significant margin expansion and a fundamental strengthening of our balance sheet. Starting with our order performance on slide 5 we have seen an unprecedented acceleration in demand. In the fourth quarter alone we secured orders worth 86 billion, a staggering 188% increase. Over the last year this surge has propelled the total order backlog to record 214 billion as on March 31, 2026.
To put this in perspective, our backlog has grown by approximately 70% in just 12 months. This provides us with exceptional multi year visibility, particularly as we begin to layer in long cycle HVDC projects alongside our core product and services offerings. Turning to slide 6 this momentum in order is translating directly into strong order top line sorry revenue Top line growth for the full year revenue stood at 62 billion representing a robust 45% increase over the last year. However, the standout feature in our financial result is a significant operating leverage that we have achieved.
While the revenue grew by 45% on the full year basis, this helped us to achieve an EBITDA of 17 billion, more than doubling versus the EBITDA of 8 billion in the last year. Previous year during the fourth quarter we achieved a record EBITDA margin of 27.2%. This margin expansion is a direct result of our disciplined approach to underwriting, a more favorable mix of export and high value services and the steady roll off of low priced legacy contracts. I would like to provide clarity on exceptional item of 690 million recognized in the last quarter and a reversal of 57 million in the current quarter.
This is one time and non operational provision related to employee retirement benefit obligation on account of new wage code. Turning to slide 7 regarding the quality and composition of our backlog, I want to emphasize our successful effort in de risking the business. We have made a significant shift in our customer profile to 98% of the backlog is comprised of private customers, Central Utilities and PSUs. Our exposure to state utilities, historically a point of concern for the investor, is now at an all time low of under 2%.
By prioritizing the high credit quality counterparties, we’re not only protecting our margins but also ensuring a more predictable and efficient cash conversion cycle. Further, while our new order booking in this year
Sandeep Zanzaria — Chief Executive Officer
You
Sushil Kumar — Chief Financial Officer
Have predominantly domestic at around 92%. Finally looking at the financial position, we concluded the year with zero debt in the balance sheet and a cash surplus of approximately 25 billion. This financial strength provides us a clear Runway to self fund our recently announced more than 10 billion of CapEx program which will expand our manufacturing capacity throughout 2028 and we remain committed to a capital allocation strategy that balances these critical growth investment and our long standing policy of rewarding shareholders through constant dividend.
With this, I’ll hand the call back to the operator for question and answer.
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We’ll take a first question from the line of Jason Sones from IDBI Capital. Please go ahead.
Unidentified Participant
Yeah, thank you so much sir for taking my question. So my first question just pertains to, you know, the revenue growth, be the domestic growth or the exports growth has been very, very strong. So just wanted to know first, I’ll just take the domestic piece, which segments are basically driving growth here in particular and just wanted to know, can you basically is this growth looking sustainable at similar rates for the next couple of years at least?
Sushil Kumar
Jason, thanks for the question. The revenue growth of 45% as you rightly mentioned, is coming from export as well as domestic side. We typically do not give by segment because we manage this as one integrated portfolio. As you see, the backlog has grown significantly and orders still outpace the revenue, which gives us good visibility that revenues will continue to grow in future as well. The rate may be different depending on each financial year because in our backlog there are long cycle HVDC projects typically which have a longer execution cycle.
So those contracts will have a meaningful execution conversion starting from financial year 2829 onwards.
Unidentified Participant
Sure, thank you for that. My next question, this pertains to, you know, in light of the strong inflation in terms of various geopolitical crisis which is shaping the world right now. Just wanted to understand in terms of this, how was the raw material pass through for us work? You know, you could speak in terms of both XHODC as well as hudc. How do you manage our contracts and our services through this? The raw material pass through.
Sushil Kumar
Jason, in our industry typically the transformer business has a price escalation clause. The transformer is either supplied directly or as a part of hvdc, but they all have the escalation clause for the other part of the business. We basically are past experience, ongoing trends and the estimated future trends. We include the cost inflation estimate in that tendering stage to protect our margins anticipated at the beginning of the order.
Unidentified Participant
Okay, okay. And so just also wanted to know in terms of localization, in terms of percentage, where are we in HVDC next? H udc and what is the maximum we can go to in both the portfolios?
Sandeep Zanzaria
So Jason, localization part we are well within the localization which has been defined by the Government of India requirements. And you know, most of the things is now with the new CAPEX coming in for thyroid walls and controls, the end product which is essentially required for HUDC will all be manufactured in the Indian factories only. However, at component level there are still expo, sorry imports which will be required. But then what happens is that for example, and then the example of GIS or any other products.
So localization is a much longer journey because you have to first identify the component supplier, then develop them, test them. So once the factory comes up and then we start the supplies, then the localization journey for thyroid walls and controls will also start at that point of time. But we are compliant with the requirement of the Government of India HODC for localization.
Unidentified Participant
And just finally, I just wanted to know in terms of when the refurbishments are happening or the upgradations are happening for the hvdc, just a clarification. Does, does it necessarily become VSC or the LCC or. It’s not necessarily that the LCC project will be converted to a vsc. I mean, just wanted to clarify that, that aspect.
Sandeep Zanzaria
So normally if you have. So there are, for example, there’s only one VSC project in India, the second one, we will be building it. So obviously refurbishment of VSC is not required as of today. But LCC for example, we have won one project in December from progress. So for the projects which have been executed like about 20 years back or 25 years back, there is a pipeline of refurbishment of projects for HUDC as well. Normally if you go from LCC to lcc then you can choose that. Okay. To change only the thyristor walls in the controls part of it, or even if you want to change the transformers there are more or less identical.
But if you change the technology like from LCC to vsc, then it is like changing everything. Because with that VSC then the whole structure, including the filter requirements and those things will change. So it is possible to change from LCC to vsc, but then the scope becomes more wider and so the shutdown requirements and the CAPEX for that refurbishment will be higher.
Unidentified Participant
So it will depend on project to project. That’s what you’re saying? Sir,
Sandeep Zanzaria
It depends upon the customer that what kind of refurbishment they want to do.
Unidentified Participant
Sure. Thank you for answering my question. I’ll join back with you. Thank you so much.
Sandeep Zanzaria
Thank you.
Operator
Thank you. Next question is from the line of Amit Anwani from PL Capital. Please go ahead.
Unidentified Participant
So thanks for taking my question. First question is on the order intake for the quarter which was roughly about 8,600 considering that it must have included the portion of the VSC order. So just wanted to understand how much is VSC out of this. And if that is the case, the conversion this quarter seems to be on a lower side even in the domestic market. So some color on the order inflow this quarter would help.
Sandeep Zanzaria
So Amit, yeah, you are right that this includes the VSC order which we have won from Adani. So as a policy we don’t declare the order value because that is also protected by the customer confidentiality requirement. So we will not be able to share the customer order value. Second also. But you have to see Amit, in the sense that whether it is H Vac or whether it is hvdc, at the end of the day it is part of the transmission scheme and it’s a technology to evacuate power from a generation source to the load area which is there.
So it doesn’t make a difference whether that HVDC should be seen as like one off or should be excluded. And then it should be seen because at the end of the day, for example, transformers are also required for hvdc. So you use those capacities to take a higher order profile. And if you really look at our full year number, so against a 10,700 crore, we have delivered a close to about more than 14,000 crores for the 14,700 crores for the year. Of course you know that for us also when we see that order intake for us should be seen more in a more in a yearly environment rather than a quarterly environment.
Because quarterly there are times when decisions get delayed and things and things like that. So if you look at an year perspective on a high base of 10,700 crores, we have been able to grow by another 37% and reach a number of 14,776 crores.
Unidentified Participant
Right. But sir, in terms of pipeline, so are we still thinking that 7 to 8,000 base order which I think earlier we have been discussing that can gradually grow for the next financial year. And also update on the HVDC orders, which orders you’re bidding and what is the stage that will help for the domestic ordering pipeline? Yeah,
Sandeep Zanzaria
So yeah, we remain confident on achieving the base order number of 7000 crores or the numbers which you are talking about about 7,000 8,000 crore. If you really look today for example, we have more than about 33 projects which are under bidding in under TBCB. And then we have further opportunities now coming up in data centers and Other segments as well. Also when we look at the HVDC part, of course I will not be able to tell that which tenders we are bidding and not. But for example, there’s only one tender which is live today which is barmer.
So the tender has been issued. Developers are working to submit their bid. Presently it is getting extended. So we are not very sure that what will be the timeline for the ultimate submission. But once that is done, we expect that to be done soon. So once that is done then obviously the opportunity will be there to us to secure that order.
Unidentified Participant
Right? So lastly, on the export data center you mentioned there’s a very strong pipeline is wanted to understand what is the proportion of data center in terms of order inflow, order book that will help. And are we seeing the domestic data center also? You know there’s a demand for your products in the domestic data center market. Some color there would help and the proportion in the order book or order inflow from the data center.
Sandeep Zanzaria
So today data center market is not that big in India. So it’s like close to about 1.5 or 1.4 gigawatt that type of a size of data center market which is already installed. But we expect this market to grow to a meaningful number in next four or five years today. That’s why because it’s not a significant number. And most of the data centers which have been installed are at 220kb. So if you look at the proportion of the order backlog, it’s very insignificant. But we expect when the data center sizes will grow and will be 400kV and 765kB at that point of time it we expect that to make a meaningful contribution in our overall backlog.
Unidentified Participant
But do we think that the export could be much larger for study when because we have seen in US and global commentary also from your parent and others that data center still much growing piece. So are we expecting exports can ramp up even faster from this level because of the data center orders you might be anticipating over next 24 months.
Sandeep Zanzaria
So of course next 1224 months will not be able to give us speculation on that that what we are expecting. But yeah, the data center story when you look at us and all it looks to be very strong. So not strong but it looks to be very strong. But mostly for example, our scope will be products only there because we don’t do projects or total turnkey scope in markets like US etc. Because we have other entities doing there. But definitely whenever there’s a requirement and they reach out to us for the support in terms of product supplies.
Unidentified Participant
Right. So what was the proportion for this whole year product versus project for us? That’s my last question. Thank you.
Sushil Kumar
So I mean we don’t typically disclose the project versus product. As I mentioned earlier it is like one integrated portfolio that we mentioned. But definitely the project has increased because we booked a large HUDC turnkey order in this quarter. However, I will highlight your attention to an important element that the projects were a challenge when we were largely state utilities. And as I mentioned in the earlier part of the call that the proportion of our exposure or the backlog to the state utilities state sector has actually reduced to less than 2%.
Unidentified Participant
Right, sir. Thank you so much, sir. And all the best. Thanks.
Operator
Thank you. Let’s take our next question from the line of Parikshit Kanpal from HDFC Securities. Please go ahead.
Parikshit Kanpal
Yeah. Hi Sandeep. Sir, congratulations on a great quarter and a great financial year and phenomenal performance and margin. First question is. Earlier in the call we highlighted about the export market. But I think this year the export has been very muted and we’d only recorded 1200 throws of order. So also 3200 crores and FY25. So. So what has changed? And I know you can relate it also to the RPT approvals. So if you can help us understand how the RPT approvals which you have taken converting into order because I see the myth has happened there.
So that 2900 crores which we took in AGM and then now this UK grid. If you can help us understand this 3000 crore is for what and this USRPT of 1300. So it can help us understand how it will translate into orders in the FY27.
Sushil Kumar
Thanks Vith for your questions. So in terms of your first question on the export orders that you booked in the current financial year which is about 12 billion INR. So last year number had large export orders that we highlighted. Excluding the large orders, our base orders have actually grown by 15 to 20%. So we see a healthy underlying trend in terms of the export trajectory excluding the large orders now coming to the large orders for which we have taken the RPT approval. The RPT approval that we took in the last agm, that project is still active but there is a delay in the decision from the customer and we are in constant discussion.
And as I mentioned in the last call we expect the difference to be in the second half of the current financial year 2627. The second RPD approval that we have taken is for a US entity. That order is again active and moving fast. We have concluded the shareholder approval. I think it was yesterday that the voting concluded. We’ll be filing a stock exchange communication today and we expect that opportunity to be decided in the current quarter. The third approval that we had taken was for UKG solution that was largely on the buy side where we need to secure the products key components on the HUDC project.
And that order also is expected to be placed in the current quarter.
Parikshit Kanpal
That is a purchase. So that will not affect an order book. So that is going to the parent entity.
Sushil Kumar
Yeah, absolutely. So this is an order that we place to the UK entity. But it is to feed the large HBDC order.
Parikshit Kanpal
But, but the whatever is the value we have not disclosed on the HPD fund. But the entire revenue will flow into the most. I’m sorry Parikshit, you’re
Operator
Sounding muffled. Can you use your handset mode please?
Parikshit Kanpal
Yeah. Is it better now?
Operator
Yes, please go ahead.
Parikshit Kanpal
So, so this, so whatever is the realization in our books on revenue. So it is irrespective of whatever we give it to the UK entity. So everything flows through us, right in the revenues for this order, the non order.
Sushil Kumar
Absolutely.
Parikshit Kanpal
Okay, so now this. What does this US order pertaining to? Is it like for any particular product? Any particular segment? So if you can give some more grand nati on that and whether now I think this is the first order from us in our history. So how do we see this US market evolving? Because in the past I think Sandeep sir had spoken about once the tariff issue is settled and we will start that market open us for us. And now we have another entity project there. So. So how do we fit in in the scheme of things for the US market?
Sandeep Zanzaria
So Parikshit, this is for high voltage products for the data center market. This order is there. And so this is being negotiated and discussed at the US See of course is there. But also depending upon the requirements, delivery schedules, etc. And the requirements, whenever it is required, the US entities will reach out to us and we will support them in terms of supplying and help them in taking a larger order which is project oriented.
Parikshit Kanpal
Okay. And I think that highlighted that PROLAC will have a low voltage distribution strategy going forward. So for the G listed NPT in India, so how does it impact, I mean as a product? So will we have any space to play there or any role to play there for if this at all happens? So how do we look at that opportunity in the distribution market?
Sandeep Zanzaria
Parikshit, two things here. So one is a US distribution market is a different ballgame and Indian distribution market is a different ballgame altogether. So. And Prolik has been present into the distribution range not from now but since many. Since many decades. So they are not entering into a new domain. So they have been into distribution center sector and they will continue to participate in distribution sector here today we don’t have an industrial unit today which is of course you lever aside the automation and the software part but on the product side which is the like the transformers etc today we don’t have an industrial setup which applies to the distribution sector.
If you want to participate in the distribution sector then it will require either an organic growth or an organic capacity to be building. And you know the price levels and quality considerations and even the participation of players like GE is not going to value add in terms of margins where we have reached. So I don’t think that’s a strategy which we can replicate in India from US.
Parikshit Kanpal
Okay, so for us like even like for prolac if there is an opportunity in India. So it’s not possible and anyways we are not interested in doing it as of now. Doesn’t make commercial sense. Is the right thing to understand from this. You cannot manufacture a transformer in US and supply to a distribution company. Right. And this is the last question on the export market again. So what is the exposure to the Middle east and the overall orders? Export orders. And how’s this market looking up? Because you said that earlier that 60 countries were present.
So just wanted to understand will FY27 will be a big year for exports because there’ll be a trickle over from FY26 of RPT and maybe new RPTs will also come in FY27. So is it right to understand that FY27 will be very strong on exports and also it will open up new markets because I think Middle east we don’t have any substantial exposure. So how would you. How are you reading the Middle east market in light of the Vietnam where parent has announced a big capex. So how does it also impact us in the RPT side?
So if you can cover all these things. That’s my last question.
Sandeep Zanzaria
So I think Middle east we don’t have much of an exposure so we are not impacted directly by the Middle east geopolitical situation. Just a second. So on the 27th if you are able to conclude this order of what we are. So you said that we did 1200 crores in last year. So this order itself will be like close to about 14001500 crores. So in the first quarter itself we will be able to exceed if you are able to close this order, what we did last year. And of course then we’ll still have three quarters left.
We remain bullish on export, as I said, but let’s see how the overall space evolves.
Parikshit Kanpal
So on a midterm, the export can be as big as the base or base business, excluding HVDC for India, because I think that’s about 70 to 80 billion. But over next three to four years, can export match up with the base orders in India? And in light of that Vietnam investment. So will anything, I mean, will Vietnam impact us at all? Because I think in Asia we were the most cost effective. And now Vietnam is also expanding, so will it also compete with us?
Sandeep Zanzaria
So Vietnam transformer factory is basically for HVDC Capex which is coming and there is a lot of HVDC projects expected in the East Asia part of it. Like it could be Vietnam, Japan, Korea and other geographies, Singapore, etc. So that is one thing. Second, I think when we look at, for example when you said that can the export market be as big as the local market?
Parikshit Kanpal
I’ll
Sandeep Zanzaria
Say that we don’t take a decision to take an order whether it’s a domestic market or an export market. We look at various lot of things like for example terms and conditions, cash flow, margin and then we take a call. So depending upon theoretically, if you ask me, yes, why not? It can be, but practically it looks to be difficult that we will be able to match an export potential which is equivalent to our base potential of the domestic number.
Parikshit Kanpal
Okay, sure sir, thank you and wish you the best. Those are my questions and once again commendable performance for this year. Thank you. Thank
Operator
You. Next question is from the line of Umesh Raut from Nomura. Please go ahead.
Umesh Raut
Hi sir. Good evening and congrats for very good set of results and ending FY26 on strong note. So my first question is on the margin outlook side. When we started FY26, you guided for low 20s kind of margins. But ultimately you revised it twice to mid twenties and then high twenties. So how should we now look at probably FY27 in terms of margins?
Sushil Kumar
We continue to maintain that we endeavor to deliver mid-20s kind of margin going forward with an endeavor to improve further wherever there are areas of improvement, including various productivity and cost control measures that we continue to take internally within our organization.
Umesh Raut
Understood, sir. One clarification. In fourth quarter we saw other expenses going up by about 30% quarter on quarter and 41% year on year was there any one off during the quarter? In other expenses?
Sushil Kumar
In the fourth quarter in other expenses there were about 500 million of mark to market on the foreign currency derivatives which is an accounting notional expenditure.
Umesh Raut
Okay, so about 50 crores you said?
Sushil Kumar
Yes.
Umesh Raut
Okay, okay, understood. My second question is pertaining to the capacity expansion that we have announced closer to 55 crores towards creating capacity for disconnectors and drives for tank circuit breakers. So I just wanted to understand thought process behind this. Is it towards backward integration so that we can achieve higher margins or is it pertaining to the philosophy of becoming Indian operations as a part of say global feeder factory for few products to global parent.
Sandeep Zanzaria
So it is both Umesh that for certain product it will be a global feed refactory. And for example disconnectors when we talk about basically disconnected the product which was there in our portfolio which was manufactured in Pattapai. Then because of very bad pricing environment at that point of time we disconnect, we stopped manufacturing this disconnector. So because if you look at the initial few years 765kv, practically all the substations have been equipped with make disconnectors and our quality was very good.
Now we are seeing a demand which is now coming back. So disconnector is a very important requirement in a transmission network. And we are now getting this feedback from various customers that they want because of the good quality they are, they want our disconnectors to be back. So that is why we have decided to now restart this disconnector as an additional product for the Indian market.
Umesh Raut
Understood sir. On the grid automation side, in last four, five years we won two large orders in the domestic market. So any color over here, is there any large order you’re anticipating in terms of tender on the lines of probably wide area monitoring system or probably say grid digitization in certain corridors, any kind of color over here and whether we can also supply or fulfill orders for grid automation in export markets as well.
Sandeep Zanzaria
So this was not for grid automation but this was for software business. Umesh because both are part of the same business line. But then grid automation is up to subscription level and software is at the network. So large order, what we had reported in the previous year was related to the software business. So yeah, there is one tender which is going on on the software side and for example wide area monitoring etc that’s the need of the hour and we expect in time a few more tenders to come up on wide area monitoring.
And yes that could be a good opportunity for us to again make a meaningful impact in terms of software orders regarding globally on the software side. Because this is basically a software development part of it. And once your platform is ready, which we have a global platform, so mostly from India, we are doing for India only, not for the export market.
Umesh Raut
Okay. And on services side, are we in a position to supply say on site engineers from India operations to global projects, especially complex projects like hodc whether it is in Europe or in North America.
Sandeep Zanzaria
But that’s part of the engineering coe. But that’s not part of gtnd. So that’s a different entity for that.
Umesh Raut
Okay, sir, understood. Thank you so much sir. All the very best.
Sandeep Zanzaria
Thank you.
Operator
Next question is from the line of Rahul Kachre from Macquarie Capital. Please go ahead.
Unidentified Participant
Yes, sir. Congratulations on good performance in the year. My first question is on the royalty and the tech fee, you know that you paid to the parent for FY26. Is it possible you can spell out that number and you know what was the comparable number in FY25?
Sushil Kumar
So Rahul, royalty and related group charges, they follow a revenue link formula that has remained broadly consistent for last many years. In FY26 we paid about 1.9 billion, approximately 3% of revenue compared to about 1.4 billion in the previous year which was around earlier years which was around 3.5% of 3.3% of the revenue. So the formulas are consistent. Depending on the mix and related composition there may be small change in the percentage of revenue year over year.
Unidentified Participant
So this in the annual report, this basically means tech license fees, trademark fees, data management charges and headquarters, corporate headquarter garage. These are the four line items which would be a part of you know, royalty etc to the parent. Is that right? Understanding.
Sushil Kumar
Yeah. So this includes technological license fees, trademark fees and HQ charges.
Unidentified Participant
And data management is not a part of royalty, right?
Sushil Kumar
No, no. Data management is operational expense which is separate.
Unidentified Participant
Okay, this is very helpful. Second, you know, given that there is one HVDC of Barbed two, you know, which is under bidding right now. Rahul,
Operator
I’m sorry to. Can you use your headset mode please? Yeah. I hope this is
Unidentified Participant
Better.
Operator
Yes.
Unidentified Participant
Yeah. So you know, with respect to The HVDC of Barber 2 and South Kalam project which is under bidding at this point in time, you know if the size is expected to be anywhere between 25 to 30,000 crore typically as a rule of thumb how much would be, you know, the share for companies like GE or some other player, you know. So the. The supply part is it 60% is something how one should look at it.
Sandeep Zanzaria
So Rahul, this changes from project to project. For example if it’s a 25 30,000 crore and suppose somewhere the line is 800 km then the share will be more.
Unidentified Participant
Same
Sandeep Zanzaria
Project if the line becomes 1200 or 1500 kilometers the share will change.
Unidentified Participant
Okay, fair enough. I think that is fair and I think, I think we’ve already spoken about margin and I think somebody had asked this. But I just want to check on this. You know given that this we have booked the HVDC and I think this is the fourth HVDC that we have booked in India over the years. How has the import content changed, you know say in the last three years or five years and how is it today? I just want the quantification in terms of how much localization has happened.
Sandeep Zanzaria
So the local content has changed drastically because when we booked the earlier two projects at that point of time as per the tender requirement only like 1/3 of the transformers could be supplied from India. But now you can supply 100% transformers from India. And now we have opened, we are in the process of opening the valves and the controls and everything from India only. So you would have seen that in one of the CAPEX announcements. We have also said that we are putting up an air core reactor facility.
Sushil Kumar
So the local
Sandeep Zanzaria
Content will now be drastically better as compared to what we did like about 2012 time when we took that order.
Unidentified Participant
Okay sir, and my last question is on the CapEx. You know this thousand crore capex this will be how much will be done in FY27 and how much will be spent in 28. Is that possible to break that number out?
Sushil Kumar
So we don’t have the split immediately. It will be a phase manner from beginning of 27 till the end of 28.
Unidentified Participant
Okay, fair enough. Thank you very much and all the very best.
Operator
Thank you. Next question is from the line of Renu Pugalia from IIFL securities. Please go ahead.
Unidentified Participant
Yeah. Hi, good afternoon team and congratulations for a super year went by. Our first question is on the VSP project which we have secured first time ever on the technology side. So what would be the localization plan for this new technology platform in the Indian domestic market? Given that if you go back by history, CK1, CK2 we were significantly ahead in terms of localizing it. So when it comes to VSC technology what are your plans to localize? That’s the first question
Sandeep Zanzaria
I think Renu, the requirement of localization for the VST is not there. But then we are examining the possibilities of what can be done, for example controls and all. Then we are building the platform for DC of controls in India. So then everything. So by localization it means that the product will be dispatched from India. A large part of the studies, integrated testing will be done. But the hardware for those panels today there is no supply chain in India. So that we are still dependent on sources which is outside transformers etc and other things anyhow are going to be supplied from Indian factories only.
Unidentified Participant
Right. So would it be fair enough to assume approximately 50% to 60% share of the total project value would be local value add or assemblies coming in for the Indian listed entities? Or it could be higher.
Sandeep Zanzaria
It will be difficult to give a number.
Unidentified Participant
Sure. So second question is slightly more longer term perspective. You know, given the demand supply gaps we have seen and the steep margin mix coming through for everybody in the industry, including yours, it’s phenomenal. But given your experience and understanding of the cycle, in your view how long could this phase Continue? For another 12, 24 months or it could potentially stretch to 36 months also further from here.
Sandeep Zanzaria
So I think if you talk to anybody in the government they will say that okay, this is a very long term story. And if you look at the Capex which is not being invested by most of the company, everybody believes that it’s a long term story. The phase of
Unidentified Participant
You should have start commencing 12, 18 months down the line or it could get slightly pushed back further.
Sandeep Zanzaria
You have to understand one thing is that last time when there was an up cycle in India, it was only in India. Okay? This time it’s not only in India but if you look at us, Europe, Middle East, Australia, there are a lot of geographies where there is an upcycle.
Unidentified Participant
This
Sandeep Zanzaria
Is not an isolated Indian phenomena. That is the first thing. Second, today if you would have seen the presentation, close to about 30% of last year’s revenue came from export.
Operator
Export. Today
Sandeep Zanzaria
We are also driving, or we are also driving a lot of export potential from our Indian factory. So we are not, I say that obviously we are dependent to a large extent on the Indian market. But then, but then export also plays a meaningful role today. And you know, today if you look at the list of HVDC pipeline, you get one HVDC order and then for example, whatever, more than a billion dollars to be executed in four years. But looking at a back end execution, even a 30% execution contributes to maybe 3, 4, 5,000 crores in a year.
So this time the cycle is different, the market is different and the longevity of the cycle looks to be more sustainable.
Unidentified Participant
Absolutely fine. And one small understanding if I can share with you and get your thoughts on. Specifically for the Indian data center market, as you mentioned, it’s not as large enough currently just about a gigawatt and a half and projections range anywhere between 6, 7 gigawatts to up to 10 gigawatts in the next five, seven years. But in a relative term if we see that, you know, India moving from one and a half to say six or seven gigawatts in the next five years would just mean incremental five gigawatt of data center demand.
And if one compared with the power generation incremental demand, you have one UMBP type of project with five or six units of supercritical where anyway adding four gigawatt by single project. So from that technical perspective, from an Indian domestic demand dynamics data center may not become as large a piece of the demand driver in the domestic market as the way it is there in the US or other markets where other sources of demand for the equipment is relatively thin. What would be your thoughts here?
Sandeep Zanzaria
So I think if you, if you would have asked anybody two years back in US did they see such a large data center business, anybody would have said no. Okay, so sitting here, if you take the example of us and if something similar happens then we are looking at a much higher demand of data center.
Unidentified Participant
Also
Sandeep Zanzaria
Expect that today for example, it’s a cumulative installed capacity of 1.5 gigawatt. But maybe going forward every year you might see like 4 or 5 gigawatt of data center coming every year. Also you are right that one UMPP is like about 5, 6, 7 gigawatt. But data center gives you a better realization of, you know, better realization of prices for the same products.
Unidentified Participant
Absolutely. Got it. Thanks much and best wishes team. Thank you.
Sandeep Zanzaria
Thank you.
Operator
Thank you. Next question is from the line of Oman Kuruvila, an individual investor. Please go ahead.
Unidentified Participant
My question is can you throw some light on your foray into nuclear energy in collaboration with Hitachi?
Sandeep Zanzaria
So thank you Mr. Oman. We are actually a transmission company so has multiple entities in India. So we don’t deal with power generation part of the business. So that’s a different legal entity. So we are not in a position to answer that.
Unidentified Participant
Thank you so much. That’s all.
Sandeep Zanzaria
Thank you.
Operator
Next question is from the line of Mahesh Patil from ICICI Securities. Please go ahead.
Mahesh Patil
Yeah, so my question is on the H VAC order, the dynamic order, what can we expect? Although you mentioned that majority of the execution would be FY29 onwards, what can we expect in the first couple of years? Can we expect around 30% of execution in the first two years?
Sushil Kumar
It should be lower than that because first two years are largely engineering and securing the sourcing and supply chain. Most of the revenue starts as I mentioned, from the FY29 onwards where the supply of material begins.
Mahesh Patil
Okay, but will it be lower than 20%? Can we have some range.
Sushil Kumar
Details of the project execution?
Mahesh Patil
Okay, thank you.
Operator
Thank you. Next question is from the line of Ankur Sharma from HDFC Life. Please go ahead. Ankur, please unmute your phone and go ahead with your question, please.
Unidentified Participant
Yeah, hi. I hope I’m audible.
Operator
Yes, please go ahead.
Unidentified Participant
Okay. So. Yeah. Good afternoon sir. Thanks as always for your time. I just had one question on the domestic, you know, transmission bid pipeline, as you look at FY27 for the domestic market, that is versus last year. And just to put this in context, we obviously seen a slowdown on the TVCB bids being placed in 26. Also reflected in the order books for power grid, kind of flattening out. So just trying to understand, obviously new PPAs are coming. So obviously we have a problem on the generation side.
So just trying to understand when you look at your pipeline for the coming year of the domestic market coming up, a very high base of last year and not just for you but for the industry as a whole, how do you see that kind of shaping up? What kind of growth do you see in that pipeline for yourself?
Sandeep Zanzaria
I’m not seeing a substantial growth in the pipeline, Ankur,
Unidentified Participant
But
Sandeep Zanzaria
I think it’s going to remain like consistent pipeline. So normally if you look at the numbers which are there, so on a high level number, when you talk about, when you talk about for example the new MEP document which has been issued, so under implementation is like close to about 500 gigawatt for the transmission schemes, but up till 2035 to be built is like 400 gigawatt. So there’s a lot of ordering which is still to be done. But first, why it’s going to make a more meaningful impact is there are like for example more than 10 HODC projects listed.
So if there is a part of the demand which is shifting from AC to dc that is more beneficial for companies like us.
Unidentified Participant
But just from the next one year point of view, any numbers you can share or anything, even in terms of your bidding opportunity, anything that you internally measure,
Sandeep Zanzaria
If I look at out of the TBCB pipeline which is there today, we have close to what, 33 packages which are which have been bidded out and the final RA and other things have not happened under decision making process
Sushil Kumar
That
Sandeep Zanzaria
33 number projects. Out of that 21 is 765. So today at least there is a decent pipeline available on the table.
Sushil Kumar
Okay. Okay, thank you. Thank you.
Operator
Next question is from the line of Mohit Kumar from ICICI Securities. Please go ahead.
Mohit Kumar
Good evening and thanks for the opportunity and congratulations on a very very strong year. My first question is can you please confirm that localization requirement is zero for HVDC Khada?
Sandeep Zanzaria
Yes, that is my understanding. Of course we are not at zero, so it doesn’t matter for us. But that is what was decided by the government for Kavla Ulpat. It was made zero because that was a VSC technology. So
Mohit Kumar
Few
Sandeep Zanzaria
Of the bidder got requested for that.
Mohit Kumar
Understood. As a second, did you see a slowness in order finalization in current quarter in the domestic market compared to last year
Sandeep Zanzaria
In the quarter which you mean like April to June or you mean.
Mohit Kumar
Yeah, it looks like the Q4 was very dull for us. Is it true statement?
Sandeep Zanzaria
Yeah, you can say that it was slightly dull for us, but that was a conscious decision. I would put it like that.
Mohit Kumar
Understood sir, I understand the Pusali HBDC upgradation you are expected to play a major role to expect this to get finalized in this Cisco
Sandeep Zanzaria
So that we will that project which is being discussed. So we’ll not be able to share any details in this call on that project. Understood.
Mohit Kumar
And do we have the capability to produce sequence condensers and how do you see this opportunity evolving in India and are you looking to localize it?
Sandeep Zanzaria
The synchronous condensers is done by.
Operator
Sorry sir, we are unable to hear you
Mohit Kumar
Off the line. Yeah,
Operator
Mohit,
Mohit Kumar
I think lost the line. Yeah,
Operator
Yeah, let me just check. Ladies and gentlemen, please take an extra. Ladies and gentlemen, we have the management team back online. Mohit.
Mohit Kumar
Yes, sir.
Sandeep Zanzaria
So Mohit, it is basically the other businesses of G Vernova which offer synchronous condensers. So the product is there with G Varnova but not with G Vernova T and India.
Mohit Kumar
Understood. My last question. There are a lot of start cost expected to get awarded in the. Given that a lot of activity bidding activity had happened but somehow we hadn’t seen any finalization in the. Any great finalization in the last fiscal year. Do we speak this particular opportunity to improve in F27 and lot of finalization?
Sandeep Zanzaria
Yeah, we expect that to improve in 27 visibas 26.
Mohit Kumar
Understood, sir. Thank you. Best of luck sir. Thank you.
Sandeep Zanzaria
Thank you.
Operator
Take our next question from the line of Shubhedeep Mitra from Nuama. Please go ahead.
Unidentified Participant
Good evening sir and thank you for the opportunity. I missed the early part of the call, so pardon me if this is a repeat question. Firstly on the fourth quarter numbers, gross margins have expanded quite a bit. Just wanted to understand that is this in regular course of business or is there a one off or one particular order which has led to better gross margins
Sushil Kumar
Issue with it? Everything is normal course of business because we have executed all the normal operational projects in the quarter. The gross margin for the quarter was higher because we had a very significant part of revenue coming from the export business. And also operationally we have as I mentioned over a period of time made two strategy changes. One is shift from state to the central and private customers which helps in the better execution and at the same time the productivity and lean related factors or the actions that we have been taking over the year are helping us to deliver and execute better.
Unidentified Participant
Understood. So say adjust for the 50 crore MTM which is effectively a one off, you would have had much higher EBITDA margins at least for the quarter.
Sushil Kumar
Sorry, could you please repeat the question?
Unidentified Participant
Yeah, so I’m saying that in the other expenses the mark to market hit of 50 crore is a one off. So if I look at it from that perspective the EBITDA margins would have been much higher and at least for this particular quarter, Visa, we’ve also been reported.
Sushil Kumar
Yeah, you may interpret that way that if the MTM DOS was not there, EBITDA would have been further better.
Unidentified Participant
Perfect, perfect. So on the same line, and since exports is such a high value driver, so do we see, let’s say over a three or four year period export mix can expand further, maybe to 40% or more. Is that a possibility?
Sushil Kumar
So we typically do not target a particular mix from a particular segment as we look at it as one integrated portfolio. And you would appreciate that HUDC is also a very key focus area. So in our backlog obviously the and the quarter and the year order booking the exports as a mix have reduced but on a like to like basis, comparable basis exports have grown. So mix may change but the entire business, the effort for the management is to grow and improve in terms of revenue, execution, profitability.
Unidentified Participant
I do. Secondly, on the HVCC side, you know, while we understand that Bagmeer is under bidding and there are maybe more than 10 projects as Sandeep highlighted which are expected to come over the years, is there any visibility of what is the next one or two AGDC projects expected to get ordered out after bar mail, let’s say in FY28 or 29.
Sandeep Zanzaria
I think one of the project which has been listed is like Lacadia Alfreta.
Unidentified Participant
I understand this is also an LCC project.
Sandeep Zanzaria
Yeah, I think next, all projects what we are looking into, this is all lcc.
Unidentified Participant
I see, I see, I see. So, so roughly one project per year or thereabout is something that one can anticipate in terms of hvdc.
Sandeep Zanzaria
If I look at that pipeline they say that about 10 projects of Rajasthan to be executed by 20, 35, 36 which is like 10 years from now.
Unidentified Participant
So
Sandeep Zanzaria
That way if you look at that will be like one project but then we expect other opportunities also to come in. For example, if Brahmaputra Basin comes in then there might be other HUDC projects from private developers also which might come in for city and feed requirements etc. So it can be more than one project.
Unidentified Participant
Understood, understood. Next, if I look at, you know you are expanding capacity and that’s expected to come up over the Next I believe 18 to 24 months. So on an expanded capacity base, what kind of peak top line can you target? Let’s say over a two, three year period, would that be some ballpark range?
Sushil Kumar
So difficult to lay out a number because as we know that capacities and revenues may not be proportionately linked because of the HVDC where we can contribute more to the revenues depending on on how much HVDC we execute because not the entire HVDC execution require capacities from inside, there’s a lot of manpower which can be increased. This is the need for the HVDC and as well as a lot of bought out equipment. But I request you to apply some acceptance ratios to make your own version.
Unidentified Participant
Of course, of course that’s what we typically do. But I just thought if I could get a confirmation from you, but not a worry. Last question from my side is in terms of the overall annual CAPEX pipeline, let’s say from an India transmission perspective, right? I mean we talk about 8,9 lakh crores spread over the next 10 years. I assume that also includes this SVDC opportunity. So roughly maybe 80,000 crore to 1 lakh crore of annual TND CAPEX is what we are hearing. Would you say that that’s essentially where overall TND market in India will plateau out at?
Sandeep Zanzaria
I think Shubhajit, because that is basically comes from the MEP document. So if you look at the MEP document that doesn’t include for example your thermal transmission evacuations. If you have, if you have heard that the government about 85 to 90 gigawatt of thermal capacity. So I think that transmission will also be there then the industrial capex, then you have the data centers in time we will have green hydrogen in addition to that, for example, the transmission is also required at the generation end.
So that is all not included in that capex. So I think if you include that that number is going to be much higher.
Unidentified Participant
Understood? Understood. Thanks so much for answering my question. So very clear. Thank you.
Sandeep Zanzaria
Thank you.
Unidentified Participant
Thank you very much, ladies and gentlemen. We will take that as a last question. I now hand the conference over to Ms. Megha Gupta for the closing comments.
Megha Gupta
Thank you, Yashasvi. Thank you all for joining the call today. We hope that the insights provided by our speakers have been informative and valuable to you. If you have any further questions or require additional information, do not hesitate to reach out to me or our communication leader. Thank you.
Unidentified Participant
Thank you members of the management, on behalf of ge Vanova Tandy India limited that concludes this conference. Thank you all for joining us. And you may now disconnect tonight.