Nava Bharat Ventures Limited (NBVENTURES) Q4 FY23 Earnings Concall Transcript

Nava Bharat Ventures Limited (NSE: NBVENTURES) Q4 FY23 Earnings Concall dated May. 25, 2023

Corporate Participants:

Ashwin Devineni — Chief Executive Officer

Sultan Baig — Chief Financial Officer

Mohit Kumar — Investor Relations

Nikhil Devineni — Senior Vice President

Analysts:

Jatin Damania — Kotak Securities — Analyst

Nikhil Abhyankar — ICICI Securities — Analyst

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Vignesh Iyer — Sequent Investments — Analyst

Jaithra Miami — ICICI Securities — Analyst

Kalpesh Agrawal — Lloyds LLP — Analyst

Vijay P — Individual Investor — Analyst

Srikrishna Agarwal — Individual Investor — Analyst

Presentation:

Operator

Ladies and gentlemen, good day and welcome to the Nava Limited Q4 FY ’23 Earnings Conference Call hosted by ICICI Securities. [Operator Instructions]

I now hand the conference over to Mr. Mohit Kumar from ICICI Securities. Thank you, and over to you, sir.

Mohit Kumar — Investor Relations

Thank you, [Indecipherable]. On behalf of ICICI Securities, we welcome you to the Q3 — Q4 FY ’23 earnings call of Nava Limited. From management, today we have with us Mr. Ashwin Devineni, Chief Executive Officer; Mr. GRK Prasad, Executive Director; Mr. Sultan Baig, Chief Financial Officer; Mr. Nikhil Devineni, Senior Vice President; and Mr. VSN Raju, Company Secretary and Vice President.

Before we go on to the main call, I would like to read the standard disclaimer. There are many forward-looking statements about the Company and its subsidiaries, which are based on the beliefs, opinions, and expectations of the Company’s management as on the date of this call. The Company does not assume any obligation to update their forward-looking statements if those beliefs, opinions, expectations or other circumstances should change. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Consequently, listeners should not place any undue reliance on such forward-looking statements.

With this, I will hand over the call to the management to take it forward. Over to you, sir.

Ashwin Devineni — Chief Executive Officer

Ladies and gentlemen, a very good morning to you all. This is Ashwin. I’m pleased to welcome you all to the investor call for Nava Limited and address you on behalf of the Board of Directors. I’m sure you all have gone through our press release on the website and on the stock exchange platforms presenting the financial results for the fourth quarter and year-ended March 31st, 2023.

Allow me to highlight some key achievements from our performance. Firstly, Nava Limited has delivered exceptional financial results for FY 2023. We have achieved the highest-ever income of INR3,928 crores on a consolidated basis, which is a remarkable achievement in our industry. Moreover, our profit after-tax for the year stands at INR1,222 crores, showcasing the effectiveness of our strategies and the dedication of our team. This robust financial performance is a testament to the resilience and commitment of Nava Limited.

One of the significant contributors to our success has been the turnaround of our Zambia operations. Maamba Collieries Limited has demonstrated its potential by achieving its higher — sorry, its highest power plant availability of 92% in the financial year of 2023, since the commencement of power generation in 2016. Furthermore, Maamba Collieries Limited has made substantial progress in the debt repayment, having repaid overdue loan installment of $98.5 million by March 31st, 2023, and an additional $49 million thereafter. To date, MCL has significantly reduced its long-term debt by $147.5 million, and we anticipate the balance overdue long-term debt of $59 million to be addressed in the near future.

The success of our Odisha-based 150 megawatt power station and the robust performance of our manganese alloy business, particularly in H1 has also contributed significantly to our consolidated performance. We have witnessed a positive momentum in our manganese alloy production with facilities in both Telangana and Odisha Works. Our firm contract for raw materials and sales give us confidence in our ability to increase volumes and drive future growth.

Looking ahead, Nava Limited remains confident in its ability to capitalize on emerging opportunities and overcome challenges in the industry. We are dedicated to delivering long-term value to our shareholders, while providing innovative solutions and exceptional service to our customers. Once again, we would like to express our gratitude to all our investors and shareholders for their unwavering support and trust in the Company. We look forward to your continued partnership, as we navigated the exciting path ahead.

Thank you all, and I wish to open the floor for any questions you may have. Thank you.

Questions and Answers:

Operator

Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] Our first question is from the line of Jatin Damania from Kotak Securities. Please go ahead. Mr. Jatin, your line has been unmuted. Please go ahead.

Jatin Damania — Kotak Securities — Analyst

Sir, first question is on the payment that you are supposed to receive from the ZESCO. Now we are supposed to receive this payment in the month of August. Now it has been delayed in the — for the month of December ’23 and ’24 in two parts. So can you highlight the reason why the payment got delayed, and what is the assurity that you are getting from the ZESCO that you will get this payment?

Ashwin Devineni — Chief Executive Officer

Yeah. So, I think — Mr. Damania, good morning. I think you’re talking about the Arbitration Award payment, right? Yeah. So like what was mentioned in the previous investor call, we had a meeting with ZESCO where they did express difficulty in terms of paying the entire amount as a lumpsum. And we have agreed to a specific period plan with ZESCO. And so far, they have been adhering to that payment plan. I think the payment plan stipulates that out of the total outstanding of $397 million, they would be paying about $215 million [Phonetic] by the end of 2023 and the balance $180 million at the end of 2024. And they’ve been adhering to that. And they’ve been making all the payment contact.

Jatin Damania — Kotak Securities — Analyst

Okay. So just because of the inability to payment in lumpsum, we have changed the repayment schedule?

Ashwin Devineni — Chief Executive Officer

Yes, which they pay on a monthly basis certain amount, and they’ve been doing that.

Jatin Damania — Kotak Securities — Analyst

And so, in monthly basis, are we receiving the amount in the escrow account or I mean, you are seeing a delay in that as well?

Ashwin Devineni — Chief Executive Officer

No. Like I said, we have been receiving those monthly payments on time.

Jatin Damania — Kotak Securities — Analyst

And sir, what is the quantum of that [Indecipherable].

Ashwin Devineni — Chief Executive Officer

The quantum of the monthly — I mean in terms of — it’s not a static amount. It differs month-on-month. I think they have put in some thoughts in terms of how they will gather funds and how the year would look like. So every month is a different quantum. For example, last month we got $16 million from ZESCO.

Jatin Damania — Kotak Securities — Analyst

That’s good. And sir, second question on the MCL that we’re operating at almost about more than 90% PLF. And we have more about [Phonetic] $59 million of overdue which will be paying in the near term. So post that, I just wanted to understand what is your capital allocation, because the majority of the orders will be paid in — probably in this financial year looking at the cash flows. So [Technical Issues] capital allocation strategy.

Ashwin Devineni — Chief Executive Officer

Yes. So I think, you said it right. Right now, out of six installments that were overdue, we paid $180 million [Phonetic]. And now the only overdue amount is $59 million, which equates to about two installments. We hope to kind of clear that very soon. Once that is done, there are certain conditions as per our contracts with the lenders that we need to adhere to such as [Indecipherable] and so on. But once that is done, then distribution will be allowed. And we hope to see that soon.

Jatin Damania — Kotak Securities — Analyst

Okay. Thank you, Ashwin. That’s all from my side. I’ll come back in the queue.

Operator

Thank you. Our next question is from the line of Nikhil Abhyankar from ICICI Securities. Please go ahead.

Nikhil Abhyankar — ICICI Securities — Analyst

Thank you for the opportunity sir, and congrats on a good year.

Operator

Mr. Nikhil, may we request you to use the handset, as you’re not audible.

Nikhil Abhyankar — ICICI Securities — Analyst

Thanks for the opportunity sir, and congrats on a good year. So, sir in the previous call, you have mentioned your intention to expand power capacity in Zambia and also expand your ferrochrome business. So have we come out with any concrete plans for the same?

Ashwin Devineni — Chief Executive Officer

Yeah. So with regards to Zambia, this interest to expand or requirement to expand has actually come from the government side, given the energy crisis in the Southern African region. So we are in discussions with the government with regards to the expansion.

And I’ll pass it onto Mr. Nikhil to talk about the ferro-alloys expansion.

Nikhil Devineni — Senior Vice President

Mr. Nikhil, thank you for the question. Were you referring to ferrochrome expansion in Zambia?

Nikhil Abhyankar — ICICI Securities — Analyst

Both, sir.

Nikhil Devineni — Senior Vice President

Sorry, I didn’t it get it. Can you repeat your question?

Nikhil Abhyankar — ICICI Securities — Analyst

Zambia. Yes, sir, Zambia.

Nikhil Devineni — Senior Vice President

In Zambia, we have no plans to set up an alloys industry.

Nikhil Abhyankar — ICICI Securities — Analyst

And in domestic market?

Nikhil Devineni — Senior Vice President

Domestic market, we were producing ferrochrome for most of H1 and some part of H2. From 15th of December onwards, we have switched over from the conversion of ferrochrome for DSL to manufacturing silico manganese. So currently, both our units, in Telangana and in Odisha, are producing silico manganese.

Nikhil Abhyankar — ICICI Securities — Analyst

Okay. And so, we have stepped down on ferrochrome. You’re not producing that much.

Nikhil Devineni — Senior Vice President

No, we’re not producing anymore.

Nikhil Abhyankar — ICICI Securities — Analyst

Okay. So coming back to the Zambia expansion, sir what kind of size are we expecting to add over there? And again, will it be going through a multi-lateral — a global multi-lateral agency for the funding and all the financial tie-ups?

Ashwin Devineni — Chief Executive Officer

So in terms of the size, we would probably like to replicate what we currently have, which is two times 150 megawatts, which is 300 megawatts. And with regards to funding, we are exploring various options. One is talking to international banks, but also talking to the government if they can kind of extend loan from their side. So all discussions are underway.

Nikhil Abhyankar — ICICI Securities — Analyst

Understood, sir. And, sir, any plans on — and basically, I want you to paint a broad picture as to how — where do you see this agribusiness in Zambia in, say, next five years?

Ashwin Devineni — Chief Executive Officer

So, on the agri side, we have been gaining large momentum. We have a large 10,000 hectare piece of land. Out of which, we’ve portioned a certain area for avocados. And then, we plan on using the rest of areas for other crops. But on the avocado front, we progressed well. I think we first targeting the initial phase of 275 hectares, which we plan on completing plantations by the end of 2023. We are essentially looking at very high value crops such as avocado. We see a lot of traction being gained with avocado in the international markets, because demand is increasing and supply is decreasing. So that — I mean — but — in agriculture, it takes time. We would expect the fruits from the first batch to only be seen in 2026.

Nikhil Abhyankar — ICICI Securities — Analyst

Okay, sir. Sir, I’ve got more questions, but I’ll get back in the queue. Thank you.

Operator

Thank you. Our next question is from the line of S.G. Kankani from S.G. Kankani & Associates CS. Please go ahead.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Good morning, sir. I’m S.G. Kankani from Raipur.

Ashwin Devineni — Chief Executive Officer

Good morning.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Sir, my question is that in financial year ’21 [Phonetic], the profit before tax was around INR890 crores, for which you made a tax provision of INR276 crores. And in the current financial, that is last financial ’22-’23, the PBT is INR1,264 crores and the tax provision is just half of the provision made in the last financial year, INR130 crores. So what is the reason for less provision for tax in spite of a higher PBT?

Nikhil Devineni — Senior Vice President

Good morning, Mr. Kankani. There are two factors. The overall consolidated tax provision consists of standalone Nava and its subsidiaries. So in Nava Limited, from this year onwards, we have shifted to new tax regime of lower taxation of 25%. That’s why the tax on the Nava standalone front is lower. On the other subsidiaries, Maamba Collieries, power sector enjoys a tax holiday. And there has been some reversal of deferred tax assets and liabilities. That’s why the overall tax provision is looking lower.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

No. Sir, I am not talking about reversal of deferred tax items. I’m talking about PBT, where if you said that calculus has made a 25%, given this tax provision for year ’22-’23 is [Phonetic] just INR130 crores. That is roughly around 110%.

Nikhil Devineni — Senior Vice President

Yes, sir. It is because of two factors. Standalone as well as consolidated. Standalone, it is standard at 25%. At the consolidated at Maamba Collieries, there has been lower taxation because of the tax holiday on the power sector.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Okay, sir. Sir, my second question is that in the consolidated financial statements, the receivables other than these non-current assets, I think presumably that non-current assets consist of dues from ZESCO. So the current assets, we have shown that trade receivables have increased from INR1,075 crores to INR2,337 crores. There is increase of around INR1,300 crores in the receivables. So in spite of the ZESCO payments, we are receiving back and that have been shown under non-current assets. So what is the reason for increasing the trades receivables which have shown in the current assets?

Ashwin Devineni — Chief Executive Officer

Sir, earlier the classification of the receivables from ZESCO was under non-current. So it’s only the change in classification from non-current to current. The overall receivable number from ZESCO has significantly come down. Two factors because of the payment against the arrears. Second because of the regular payments which is happening from May ’22 onwards, there has been no increase on the monthly receivables.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

That is right, sir. I am talking about trade receivables which have been shown under current assets. So that does not include dues from ZESCO. So the current assets receivables have gone up from INR1,075 crores to INR2,337 crores. There is increase of around INR1,300 crores. So I presume that ZESCO receivables are not included in current this trade receivables. So what is the reason for increase in trade receivables under — shown under current assets?

Nikhil Devineni — Senior Vice President

Sir, that has been a transfer from non-current to current. The overall receivable number has come down, but it’s only classification difference from non-current to current because now we are considering the entire receivables from arbitration proceeds as current receivables.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Okay. Sir, you have shown that INR3,400 crores are still dues from ZESCO. So these payments are to be considered [Phonetic] in monthly installments as mentioned in the Arbitration Award.

Nikhil Devineni — Senior Vice President

Yes, you’re absolutely right.

S.G. Kankani — S.G. Kankani & Associates CS — Analyst

Okay. Thank you, sir.

Ashwin Devineni — Chief Executive Officer

Thank you.

Operator

Thank you. Our next question is from the line of Falguni Dutta from Jet Age Securities Private Limited. Please go ahead.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Good morning, sir. Am I audible?

Ashwin Devineni — Chief Executive Officer

Yes.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Sir, I have three questions. One is, what is the — what are the outstanding dues from ZESCO as on date, I mean, as we speak?

Ashwin Devineni — Chief Executive Officer

The current outstanding amount from — yeah, it’s $397 million [Phonetic] right now.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

How much, sir?

Ashwin Devineni — Chief Executive Officer

$397 million.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

And sir, what is the loan outstanding at Zambia?

Ashwin Devineni — Chief Executive Officer

$265 million [Phonetic].

Falguni Dutta — Jet Age Securities Private Limited — Analyst

And sir, one more question is on the power plant. Sir, why do — are we considering at all of increasing the size of the power plant there even though there is a — I mean, notwithstanding that there is a power crisis there since our experience in terms of payment has been poor. So what gives us confidence in going ahead with it the new power — the new expansion that you spoke of two [Phonetic] into 150 megawatts?

Ashwin Devineni — Chief Executive Officer

Yes. I mean, see, one is there is a lot of demand. The second thing now is we are also a member of the Southern African Power Pool. So it’s not like ZESCO — our experience with ZESCO has been poor in the past, but once now that we are a member of the Southern African Power Pool, we have another window where if we do experience a vast amount of defaults from the ZESCO, we’re not happy with the ZESCO’s off-take, we can always go on to selling in the Southern African Power Pool grid, which is kind of like an exchange.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Okay. Thank you. And…

Ashwin Devineni — Chief Executive Officer

The other thing you should — you have to keep in mind is the second phase is essentially like a no-brainer, because all the auxiliaries for 600 megawatts already exist. So, yeah.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Okay. And, sir, one last question. This is just a clarification. In your notes to accounts, I saw some discount which was I think if I’m not wrong included in that figure of $180 million-odd. So, what was this discount? And has it been provided for, if yes, in which year?

Nikhil Devineni — Senior Vice President

Ma’am, are you talking about the discount on the receivables from ZESCO?

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Yes, sir.

Nikhil Devineni — Senior Vice President

Yes, ma’am. If you could recall, our overall outstanding due from ZESCO when we have gone into arbitration was $578 million. And in the mutual discussions between us and ZESCO during arbitration, we’ve given them a discount of $60 million. So, this $60 million doesn’t hit the P&L because it has been adjusted against existing provision.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Okay, understand sir. Thank you, sir. That’s all from my side.

Operator

Thank you. Our next question is from the line of Vignesh Iyer from Sequent Investments. Please go ahead.

Vignesh Iyer — Sequent Investments — Analyst

Sir, yeah, two questions from my side. First is, sir, I just need a clarification against — sir, if I’m not wrong, the payment plan — I mean, the money that has to come from ZESCO is around $397 million. How much did you say would we get in FY ’23 and how much in FY ’24 or CY ’23, CY’24?

Ashwin Devineni — Chief Executive Officer

So the total amount is $397 million. As per the plan, we should be getting $250 million [Phonetic] by the end of FY ’23.

Vignesh Iyer — Sequent Investments — Analyst

Okay.

Ashwin Devineni — Chief Executive Officer

Sorry, by the end of calendar year ’23, not FY ’23. And $180 million by the end of calendar year 2024. So by end of December, we should be getting $250 million. And by end of December 2024, we should be getting the balance, which is $180 million.

Vignesh Iyer — Sequent Investments — Analyst

Fair enough. And this payment would be on a continuous basis, right, every month basis, right? And not…

Ashwin Devineni — Chief Executive Officer

It’s not a constant number. It is on a monthly basis. And we have been getting it like I disclosed last month, they were supposed to pay $60 million as per the payment plan and they paid us $16 million.

Vignesh Iyer — Sequent Investments — Analyst

$60 million, right?

Ashwin Devineni — Chief Executive Officer

$16 million.

Vignesh Iyer — Sequent Investments — Analyst

$16 million, okay. I mean, the April to December, you should get $250 million basically, if I’m reading it right.

Nikhil Devineni — Senior Vice President

So, the total payment that you supposed to receive in the calendar year was $250 million. We have already received about $40 million, so balance $210 million will be received from May to December.

Vignesh Iyer — Sequent Investments — Analyst

Okay. Fair enough. Yeah. Got it. And sir, my other question from my side is the power plant availability is at 91%, which is quite high, I mean. So how — what is the situation right now, I mean, after almost two months down in this quarter? And how confident are we that we can maintain at this rate going ahead because that is your major chunk of — in our business to your entire Nava consolidated?

Nikhil Devineni — Senior Vice President

No. I think as you know, the — owing to the team we have at Maamba who are operating the power plant, they’ve been doing an excellent job and hence the high availability. So apart from your usual planned shutdown and maybe one or two unplanned shutdowns, we’re not facing any major issues there and we are confident that we will be operating it at high availability.

Vignesh Iyer — Sequent Investments — Analyst

Okay. Sir, how much was the plant shutdown days or unplanned one in the current quarter, I mean quarter four?

Nikhil Devineni — Senior Vice President

No. Annual, we basically operate at about 85%. That’s the target.

Vignesh Iyer — Sequent Investments — Analyst

Okay. But we did have some shutdown in the current quarter, right?

Nikhil Devineni — Senior Vice President

That is after [Indecipherable].

Vignesh Iyer — Sequent Investments — Analyst

Sorry?

Nikhil Devineni — Senior Vice President

Okay. Q4 availability was 88%. There have been no unplanned shutdowns. This is basically all planned.

Vignesh Iyer — Sequent Investments — Analyst

Okay. Okay, fine. Thanks. Yeah. Thank you, sir. And that’s all from my side. All the best.

Operator

Thank you. [Operator Instructions] Our next question is from the line of Jaithra Miami[Phonetic] from ICICI Securities. Please go ahead.

Jaithra Miami — ICICI Securities — Analyst

Hi. Am I audible?

Nikhil Devineni — Senior Vice President

Yes, please.

Jaithra Miami — ICICI Securities — Analyst

Okay. Thank you for the opportunity. And my question is, what is the realization on merchant sale from the South Africa pool? And what is the outlook on merchant sales for FY ’24?

Nikhil Devineni — Senior Vice President

I wouldn’t like to get into details now with regards to how much we’re making on the SAPP and ZESCO. I think the arrangement we have with the ZESCO is basically, if they are not able to take power, they let us know. And then, we sell that in the Southern African Power Pool. But during the past few months, they’ve been taking 100% of the power, paying us for 100% of the amount. So, our SAPP sales had been fairly minimal in the past few months because of the fact that ZESCO wants and is taking all the power.

Jaithra Miami — ICICI Securities — Analyst

Okay. And can you also give the breakup of debt across some — of the various entities?

Nikhil Devineni — Senior Vice President

I’m sorry, what? Can you repeat yourself?

Jaithra Miami — ICICI Securities — Analyst

If you can give the breakup of outstanding debt, your outstanding loans?

Nikhil Devineni — Senior Vice President

Outstanding debt.

Sultan A Baig — Chief Financial Officer

Outstanding long-term debt as on date is $265 million.

Jaithra Miami — ICICI Securities — Analyst

Okay.

Sultan A Baig — Chief Financial Officer

I meant — this is for Maamba Collieries. Isn’t it that your question?

Jaithra Miami — ICICI Securities — Analyst

Yeah. Okay, fine. That’s good. Thank you.

Sultan A Baig — Chief Financial Officer

Yeah. Hello. Who’s next?

Operator

Yes, sir. We will go ahead with the next question. Our next question is from the line of Kalpesh Agrawal from Lloyds LLP. Please go ahead.

Kalpesh Agrawal — Lloyds LLP — Analyst

Hello?

Ashwin Devineni — Chief Executive Officer

Hello, Mr. Agrawal.

Kalpesh Agrawal — Lloyds LLP — Analyst

Good morning. Is my voice audible?

Ashwin Devineni — Chief Executive Officer

Yes, yes.

Kalpesh Agrawal — Lloyds LLP — Analyst

Yeah. Congratulations on a very good set of numbers, sir. And it is very encouraging to see these kind of numbers. I would like to understand one thing. In the first line, you have said that Board of Directors considered that improved cash flow position at MCL may reach a higher dividend payout. So, want to understand that are we getting cash flows remitted from Maamba to Indiana? I mean, that’s happening smoothly when earlier some years back, we had some kind of resistance from getting back the cash flows. And even when we see the cash flow number, what has really happened is that consolidated cash balance remained same, but standalone has seen some kind of reduction in the cash balance, and there is no capex in standalone is concerned. So, I would just want to understand the [Indecipherable] and if you can guide us through.

Nikhil Devineni — Senior Vice President

Yeah. So with regards to our dividend, mostly we generally go by — go with standalone numbers. So what I meant by Board of Directors considered a higher dividend is because of the turn of events from Maamba Collieries. The cash is still not come from Maamba to the Company, otherwise it would have been reflected in the standalone. But what –because what Maamba has been doing in the past few months is using the cash it has been generating to reduce the debt significantly. We’ve come down from $483 million as of April ’22 to now we’re only at $265 million. So — and this happened essentially in the last six months. We almost paid off $218 million of debt.

What we foresee and what the Directors foresee is now with this improved position, and once we clear all the overdue payments of the lenders and meet the requirement as per the loan agreement, we will be able to start distribution in the near future. So, given that progress, I think we have agreed and decided to pay 300%.

Kalpesh Agrawal — Lloyds LLP — Analyst

Okay. And one more — another question is that — for the kind of cash flows we are generating, you are using it to primarily repay the loan that you shared in Maamba. So, over the period of time, now we have something around INR2,700 crores outstanding on a consolidated basis. And considering that you pay every six months, so I guess what kind of run rate you are expecting in the kind of repayment, sir?

Nikhil Devineni — Senior Vice President

No. I think it’s not our intention to pay the entire loan before we start distributing. I think the issue here is there are overdue amounts to the lender, because previously it was six installments that were overdue. Once — and today we are only two, because we paid off four of them. So once you pay the other two and meet certain conditions that the lenders have put in the agreement, we will be partly in a position to declare — I mean, basically start distribution while we continue paying off the debt as per the six monthly installments. So it would run at parallel. But I think the key thing here is to pay off the overdue amounts.

Kalpesh Agrawal — Lloyds LLP — Analyst

Right. Because we are kind of making INR800 crores yearly profit, and I understand that cash flow will be significantly higher when it comes to Maamba because $100 million comes to INR800 crores, the cash flow is something INR1,000-odd crores. Of the INR1,000 crores, how much percentage you say you can remit after making that condition, sir?

Sultan A Baig — Chief Financial Officer

Mr. Agrawal, as our CEO pointed out, about $59 million we have to repay the outstanding lenders amount as and when we realize the receivables. And post that we have to fulfill the debt covenants, like filling the DSRA account, so on so forth. Post that the distribution window opens for Maamba Collieries through[Phonetic] dividend to the shareholders.

Once the distribution window opens, that’s when the dividend starts. Nava will take — Nava Directors will take a call to take upon the requisite corporate actions.

Kalpesh Agrawal — Lloyds LLP — Analyst

That I understood. What I’m trying to understand is that out of $100 million yearly profit, or say $125 million cash profit, what internally the management will be able to remit after all the — taking everything you shared right now.

Nikhil Devineni — Senior Vice President

Let me say just like this, on a normative run rate, yeah, we do get around $90 million to $100 million of cash in Maamba. And as we see it, the repayment requirement is about $60 million a year. So this will continue till [Indecipherable].

Kalpesh Agrawal — Lloyds LLP — Analyst

Okay.

Nikhil Devineni — Senior Vice President

So balance money, other than for keeping the opex, we will hope to have distributions and we would be entitled for 65% thereafter.

Kalpesh Agrawal — Lloyds LLP — Analyst

Thank you. I understood.

Nikhil Devineni — Senior Vice President

That’s how the plan should work. Once the voluntary payments are done, and we need the loan covenants in this year, balance of the year, we probably would be in a much better position to give you exact numbers on how it pans out.

Kalpesh Agrawal — Lloyds LLP — Analyst

So, roundabout, we are working — I am working with $20 million debt, so I’m close to INR1,700 crores should be a comfortable number for us.

Nikhil Devineni — Senior Vice President

Yeah.

Kalpesh Agrawal — Lloyds LLP — Analyst

Thank…

Nikhil Devineni — Senior Vice President

And you’re about right, yes.

Kalpesh Agrawal — Lloyds LLP — Analyst

Thank you. Thank you. Thank you, sir.

Operator

Our next question is from the line of with Vijay P, individual investor. Please go ahead.

Vijay P — Individual Investor — Analyst

Hello, am I audible?

Ashwin Devineni — Chief Executive Officer

Yes, you are. Yeah, Vijay.

Operator

Mr. Vijay, may we request you to use the handset…

Vijay P — Individual Investor — Analyst

Yes, I’m using the handset.

Operator

Okay. Thank you.

Vijay P — Individual Investor — Analyst

Sir, my question is regarding the — in the first list, since the press release came out just five minutes before this discussion started, I’m shooting in the dark as far as the performance numbers are concerned. There was no investor presentation also this time, which normally comes. So I have a question about the dividend. You are paying out INR80.5 crores as dividend this year, which works out to 25% of your standalone profit as per your stated policy of 25% outflow[Phonetic]. But if you look at the consolidated profit, it is barely 5.3%. Is it going to continue in future the standalone profit and consolidated profits are different company net profits?

Nikhil Devineni — Senior Vice President

Mr. Priyonkar, in terms of the numbers, I think you’re slightly off.

Sultan A Baig — Chief Financial Officer

The dividend payout this year is slightly higher. If you would recall in our history, we’ve been generally paying about 22%, 23% of standalone PAT as a dividend. But this year, if you take into consideration the INR6 dividend, which is we’re working out to INR87 crores, it is about 27% of the PAT on the standalone basis. And…

Nikhil Devineni — Senior Vice President

Yeah. And in terms…

Vijay P — Individual Investor — Analyst

Why are the distributions between standalone and consolidated ones have differences so much? Standalones profit is only 300 — the consolidated profit is INR1,518 crores.

Nikhil Devineni — Senior Vice President

The reason we differentiated, Mr. Priyonkar is because there is a difference in terms of the cash on hand that the Company has to distribute dividend is from the standalone. Once the consolidated operations start distribution or declaring dividends to the parent company, it will come to the parent company and reflect on the standalone numbers. So, basing it as a percentage of the consolidated profits would not make sense for us because that wouldn’t be cash that we would have available to distribute.

Vijay P — Individual Investor — Analyst

Just for a clarification, apple on — apples-for-apples basis, the two key managerial representatives of the Board get 2% of the net profit of the Company as commission. Is this 2% also paid on standalone and not on consolidated?

Nikhil Devineni — Senior Vice President

Yes, it is paid on a standalone.

Vijay P — Individual Investor — Analyst

All right. My next question is about your — yeah. Yeah, I’m taking that as the gospel fruit. I’m moving to the next question of, what is the status of the manganese mine in Ivory Coast? When it is going to come on the line?

Nikhil Devineni — Senior Vice President

Mr. Priyonkar, the exploration works are underway. From our Phase B what we’ve seen thus far is that there is a presence of manganese. Probably, by H2, we’d be able to ascertain in terms of what the probable reserves are as well as the suitability of the ore for producing manganese alloys.

Vijay P — Individual Investor — Analyst

Okay. So the manganese ore mined is still not on production, it’s still on exploration?

Nikhil Devineni — Senior Vice President

Correct.

Vijay P — Individual Investor — Analyst

All right. The second question I had was about the monetization of assets that has been there on the cards for more than two, three years. The latest one is the Nacharam, where we are employing the services of JLL.

Nikhil Devineni — Senior Vice President

Yes. So with regards to Nacharam plant, like you rightly said, we have engaged JLL. What has happened since then is, you probably remember there were the ULC, Urban Land Ceiling Matters act we were fighting in for, which we won. The government has appealed that judgment which is going to be admitted in the High Court. And due to that, the offers or the interest we have been getting were slightly subdued. And in addition to that, what we have been realizing is in Nacharam, the land prices, the valuations have been increasing at a very drastic pace. So what we have decided is to kind of halt the activity of selling it right now so that — and probably resume it at a later point in time where we get a much better valuation.

Vijay P — Individual Investor — Analyst

But is the land currently sellable if the government has gone on appeal?

Nikhil Devineni — Senior Vice President

We consider that appeal to give excess share, Mr. Priyonkar. We’re tackling it in a matter of time that we get that matter out of the bay.

Vijay P — Individual Investor — Analyst

Thank you very much. That is all from my side.

Nikhil Devineni — Senior Vice President

Yeah.

Operator

Thank you. Our next question is from the line of Srikrishna Agarwal, who is an individual investor. Please go ahead.

Srikrishna Agarwal — Individual Investor — Analyst

Yeah. Good morning, everybody. My most of the questions have been answered. My only request is that to schedule the meeting after the market hour of 3:30. If in the market hour, it’s really difficult to attend all these meetings.

Ashwin Devineni — Chief Executive Officer

Sure.

Operator

Thank you. Our next question is from the line of Nikhil Abhyankar from ICICI Securities. Please go ahead. Mr. Nikhil, your line has been unmuted. Please go ahead with your question.

Nikhil Abhyankar — ICICI Securities — Analyst

Sorry. So what was the — what were the merchant sales in Q4 in India? And how is the trend in the last two months?

Nikhil Devineni — Senior Vice President

Sorry, can you repeat yourself?

Nikhil Abhyankar — ICICI Securities — Analyst

Sir, what were the merchant sales in India? And how is the trend in the last two months, April and May?

Nikhil Devineni — Senior Vice President

You’re talking about power or…

Nikhil Abhyankar — ICICI Securities — Analyst

Power. Power. Yeah, power.

Nikhil Devineni — Senior Vice President

You see, in Q4, unfortunately the prices weren’t that great, where we were getting really kind of margin that we are restricting over the variable cost of coal. But we see a clear uptick from April onwards. And so, Q1 of the current financial year, we see a much better performance in terms of merchant performance. Though we cannot put a number out now, but merchant performance is different.

Nikhil Abhyankar — ICICI Securities — Analyst

And sir, just a final question. Any update on Hyderabad or Dharmavaram land deals?

Nikhil Devineni — Senior Vice President

Our CEO has just covered it, but on Dharmavaram land I’ll leave it to you.

Ashwin Devineni — Chief Executive Officer

No, Dharmavaram land, there has been no progress. I don’t think that’s something we are concentrating on right now to liquidate because valuations are fairly low there. But on the Hyderabad land, I just did communicate that the — there is an appeal on the ULC matter. And also given the trend of prices moving upwards with regards to that area, we want to hold it so we get a better valuation in the future.

Nikhil Abhyankar — ICICI Securities — Analyst

Okay. Thank you.

Operator

[Operator Instructions]

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Hello? Yeah, sir. Yes, sir. Sir, one question from my side again. Sir, what is the volume of our merchant sales, let’s say, in FY ’23 in a million units, if you can give?

Nikhil Devineni — Senior Vice President

Give us a second. You’re talking of power, right?

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Yes, sir.

Sultan A Baig — Chief Financial Officer

580 million units, ma’am.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

580 million units in FY ’23 is the merchant sales from India, right?

Sultan A Baig — Chief Financial Officer

Yes.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

And sir, this number is constant through the year, I mean, all the — each of the years or it undergoes a change depending on?

Sultan A Baig — Chief Financial Officer

It changes on depending upon the market prices.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Then the sales volume also changes?

Sultan A Baig — Chief Financial Officer

Yes.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

In case if we don’t sell it to the merchant market, we entered into some agreements with somebody?

Nikhil Devineni — Senior Vice President

We have been doing this merchant sale through IEX mostly, except for some contracts which are for a month or two kind of a timeframe. But otherwise, it’s been mostly on IEX sales. So as my colleague pointed out, the volumes keep changing depending on how the merchant power prices behave vis-a-vis our cost of generation.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Okay. And sir, pardon me for my ignorance. One more question. What would be our total sales, if you can give, power sales again, in India in million units, again FY ’23?

Nikhil Devineni — Senior Vice President

Sure. I think…

Sultan A Baig — Chief Financial Officer

Ma’am you can look at segmental bifurcation in the results published.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Volumes would be given there? I was asking for volumes in million units.

Sultan A Baig — Chief Financial Officer

We just mentioned to you ma’am, 580 million units.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

This is the total power sales that we do? Not just the merchant, I was asking about the total in India.

Sultan A Baig — Chief Financial Officer

Just give us a minute. It’s 1,230 million units, ma’am, captive as well as third-party fees.

Falguni Dutta — Jet Age Securities Private Limited — Analyst

Fine, sir. Thank you. Thank you. Thanks a lot.

Operator

Thank you. That was the last question of our question-and-answer session. I would now like to hand the conference over to the management for closing comments.

Ashwin Devineni — Chief Executive Officer

I’d like to thank each and every one of you for your earnest participation in today’s call. Thanks to all of you for your unwavering support once again, and I hope all your questions have been answered. In case you have more questions, please reach out to us on our wider investor platform and we’ll be happy to provide our answers. Thank you, everyone.

Operator

[Operator Closing Remarks]