Seamec Ltd (NSE: SEAMECLTD) Q1 2026 Earnings Call dated Aug. 14, 2025
Corporate Participants:
Unidentified Speaker
Balasubramanian
Rajiv Goel — Non-Executive Director
Vinay Kumar Agarwal — CFO
Sunil Gupta — Vice President, Strategy and Investor Relations
Analysts:
Unidentified Participant
Harshit Jain — Analyst
Hitesh Agarwal — Analyst
Jaishri Bajaj — Analyst
Rahul Chaturvedi — Analyst
Deepak — Analyst
Raj Patel — Analyst
Darshan Shah — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the CEMAC Limited Q1FY26 earnings conference call hosted by Arihant Capital Markets Limited. 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 this conference call please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Bala Subramanian from Ariant Capital Markets Limited. Thank you. And over to you sir.
Balasubramanian
Thank you. Palak. Good morning everyone. On behalf of Ariant Capital, I welcome you to the earnings call of CMAC Limited for Q1FY26. From the management side we have Mr. Rajiv K. Non Executive Director. Mr. Vinay Kumar Agarwal, CFO and Mr. Smil Gustav, Vice President Strategy and Investor Relations. We welcome the management of CMAC on this call. Now I invite Mr. Rajiv K. The non Executive Director to give his opening remarks. Following which we will open the floor for Q and A. Over to you sir.
Rajiv Goel — Non-Executive Director
Are we audible?
operator
Yes sir. Please go ahead.
Rajiv Goel — Non-Executive Director
Hello. Good morning to all. I am Rajiv Boyal, non Executive Director of CMAC Limited And I welcome all of you to this Investor conference for CMEC Limited for printing our results for quarter one FY26. The global shipping industry remains the foundation of international trade. With the oil and gas sector continuing to be the one of the largest value generators worldwide. I also have with me my Chief Financial Officer Mr. Vinit Garwal and our Vice President, Strategy and investor. Listen, Mr. Sunil Gupta. Entering 2025, the offshore oil and gas industry is on clear growth trajectory supported by rising global energy demand, technological advancements and an active investment climate.
Despite challenges from the supply chain inflation and the geopolitical uncertainty. As of now, the global oil demand is projected to reach 103.9 billion barrels per day in 2025. While the offshore drilling market is expected to expand from USD 36 billion in 23 to over USD 80 billion by 2033. A compounded annual growth exceeding 8%. Investment in deep water and ultra deep water exploration Enabled by advanced technologies such as auv, ROV and AI driven analytics are gathering pace across the globe. India, with its 7,500 kilometer coastline and growing economic need, is positioned to benefit significant from this upcycle.
Policy initiatives taken by the government like Maritime Visa 2030 and the Sagar Mala program along percent FDI allowance in critical Energy subsector and the allocation of over 1 million square kilometers of offshore exploration underscore the government intent to expand the oil and gas sector. So in this booming environment, PMEC is advancing its leadership in the diving support vessel segment while executing a deliberate diversification into offshore support vessels and accommodation barges. This strategic fleet expansion increases our operational flexibility and strengthens our ability to participate in a wider range of offshore projects including EPC link assignment. Operationally, the quarter saw solid execution across our fleet with 93% efficiency factor.
CMEC Princess successfully completed the pipeline replacement project 7 and transitioned directly into the pipeline replacement project 8 and the Daman Upside Development project. This vessel completed its season on 17 June 2025 against the projections of 30 May 2025, thereby generating revenues for additional 18 days in the quarter. The other vessels, CMAC 3 continued to generate consistent return through extended charter hire period signed by way of Adenum on its original BIMCO Chartapathy Agreement. CMAC 2 completed its dry dock well before the planned pipeline of 30th September, so we are expecting the vessel to to go back to the field by 10th of September which is a saving of almost 20 days in the scheduled time.
Going forward, the acquisition of Nusantara by the company is well on track and the sale transaction is expected to be completed in August itself and as of now we plan to to put the vessel in the field starting December 25 onwards. We have received the shareholder approval for purchase of CMEC announced and now the transaction has started for acquisition of the vessel by CMEC and we expect to complete this by October 25th. So overall we remain committed to operational excellence and timely execution of all our ongoing present contracts. With strong sector fundamentals and a clear strategic direction, we are confident that the financial year 2526 will be a year of execution, consolidation and growth for cmec.
With the addition of these two high value vessels, Nusantara and CMEC Anand, our focus will remain on optimizing our fleet, securing value, attractive contracts and maintaining financial discipline to deliver sustained value to our stakeholders. I will now hand over to Vice President Mr. Sunil Gupta who will take forward from there. Thank you very much.
Sunil Gupta — Vice President, Strategy and Investor Relations
Thank you Rajiv Ji and good morning to all. I extend a warm welcome to everyone for today’s. Let me take you through financial. Our consolidated for Q1FY 2631 crores compared to 223 crores in Q1FY25 reflecting a yoy growth of 4% on a standalone basis. Revenue registered an increase of 2% over the same period last year. However, due to better operational mix and the charter hires, the consolidated EBITDA for quarter stood at 1% crore compared to 81 crores in Q1FY20 hires of increase of 45% on standalone basis. EBITDA rose by 34% crore in the corresponding quarter of the previous year.
On the profitability front, consolidated profit after tax stood at rupees 76 crore as against rupees 50 crores in Q1FY25. On standalone level, profit after tax moved from rupees 52 crores in Q1F25 to INR 80 crores in Q1FY26. Our rot for the quarter stood at 11% while ROE stood at 10% on consolidated basis. We believe these results reflect our steady progress and resilience positioning us well for the year ahead. Thank you. I will now hand it back to moderator to initiate Q and A session.
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 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Unidentified Speaker
Moderator, we are not able to hear your voice clearly. I hope we are able to hear the questions of the participants clearly.
operator
Yes sir. The first question is from the line of Harshit Jain from Trinetra Asset Manager. Please go ahead.
Harshit Jain
Hi sir. Am I audible?
operator
Yes sir.
Harshit Jain
Thank you. I would rech. Sorry to interrupt. I would request you to be little louder and little slow because where we are, the voice is not clear. Okay. Definitely sir. I’ll do that. Okay. Yeah. My first question is. So the management piece has been around 3 to 4% of the sales and it’s been increased. It is a significant decrease over the years. So can you throw some light on that and when it would come down Sumit. Can you repeat the question? The question is that the. Please go ahead. Marinement ph is around 3 to 4% of the sales and is a significant increase over the years.
So when can we expect it to come Down.
Rajiv Goel
See this management fees that we are paying at present, it is well within the market benchmark and the company, you know has appointed Grant Thornton to undertake a comprehensive related party transaction. And we are expecting that report anytime in the coming weeks. And once that report is received by us basis the report, if there’s any recommendation that this management fees needs to be curtailed down, you know we the management will be more than happy to take such appropriate steps. But if the report says that it is well within the market benchmark, I don’t think we really require to bring that down.
So we’ll share the related party detailed comprehensive study from Grant Thornton with our stakeholders as and when we receive it.
Harshit Jain
Okay, thank you. My second question is how much have we invested in our UK business? Earlier it was mentioned that we are planning to invest less and bring back the money from the UK business. So can throw some light on this.
Rajiv Goel
Yeah. So in respect of the UK business. So as we have always maintained that part of the asset will be used for our global operations because with our expanding fleet we see the North Sea market as a great offshore operation opportunity. And the other part of the investment shall be brought back once the entire project is complete. So when we initially envision planned this project. So this project was slated to be completed by March 25th. As of now, you know our plans are to complete this in another 12 to 15 months period and we are on track, we have got the approvals and once that is done we will definitely bring half of the.
Harshit Jain
Okay, thank you sir. My next question is that the UK subsidiary is expected to turn cash flow positive only by financial year 27. So what is the cumulative loss projection until then and how much it is expected to impact the consolidated roce?
Rajiv Goel
So actually you know, till the global operations commencement, till that time whatever is the cost that we are incurring in the UK operations that is all part of the CapEx. So as such you know there is not a very significant operational loss that we are foreseeing and even to you know stop the interest burden on the loans that were granted to the subsidiary. So the company in the past through property expert opinion and board approval had already converted the loans into redeemable preference share thereby saving on the interest outlook. So as such going forward the major factor of interest has now stopped and I don’t see any significant OPEX cost coming into operation.
Sunil Gupta
Adding to what Rajiv just said I would like to highlight in March 24 numbers the operating loss, total loss of overseas companies was 66 crores which was last year curtailed to 28 crore. And this year also we expect that it will be substantially brought down. And as he said, gradually we would like that our total operations become profitable.
Harshit Jain
Okay, so one final question from my side. What’s the status on the Anant and Vishakara acquisition and when can we expect the deployment? And what is the revenue potential for upcoming two years?
Sunil Gupta
As Ajitji mentioned in his opening remarks, we are about to complete the acquisition of Nusantara in the month of August.
Post which the vessel will be sent for dry dock which is a mandatory requirement. Generally the dried off period is a three month period and we would like to expedite that as much as we can. With regard to Anand, the shareholder approval has already come. Now the other regulatory approvals are in the process. While the exact timelines may not be clear but we believe that by October we should be able to complete that and bring the vessel to water.
Harshit Jain
Okay, so sir, what is the revenue potential for financial year 26 and 27 and how much margin can we expect on these? How much margins can we expect in these vessels?
Sunil Gupta
See generally in our driving support vessels we expect a margin of 30, 35%.
Harshit Jain
Okay. Okay. So yeah, that is from my side.
operator
Thank you sir. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference call, please limit your question to two per participant. The next question is from the line of Hitesh Agarwal from PL Capital. Please go ahead.
Hitesh Agarwal
Hello sir. Am I audible?
operator
Yes.
Hitesh Agarwal
Yes. Yeah. Thanks for the opportunity. Sir. I have a couple of question. So with the global offshore drilling expected to grow at 8% CAGR till 2023, how is CMAQ positioning itself to capture a large share of deep water and ultra deep water projects especially in regions like West Africa and Brazil.
Rajiv Goel
As of now, you know we are not exploring Africa at the market for our operations. The entire fleet as of now is totally engaged on long term charter for the next two to three years. Except CMEC 3 which we are keeping aside for short term charters. We have got ample opportunities on the east coast side because that is a development which is taking place very very great pace and aggression. And CMAC 3 was deployed in last season also in the east coast. Again in this season it is going to the east coast. So we do not have any plans to actually explore the as of now.
Hitesh Agarwal
Okay. Okay sir. And some just follow up question. Do you currently have any or have the technical capabilities for ultra deep water assignment? And are you evaluating any partnership with the offshore contractors?
Rajiv Goel
So you know we are primarily a air diving and surface diving operation company. What we are doing is we are coming forward and expanding our scope from a diving operating company to a subsea operator. And we are also exploring the market of Middle east especially the oil fields of Saudi Arabia and the United Arab Emirates because that is where the company in the last two years has gained presence, has earned credibility and in fact the vessel Swordfish has now been deployed for a period of two years with the Saudi Aramco. And that’s a very big achievement because that is one of the toughest market in terms of compliance and vessel maintenance and the rates are very good.
So we are more focused on the existing fleet or adding similar fleets to enhance operations in the Middle East. Deep water diving is a totally different ball game. It requires different capex planning, strategy, planning and as such, you know the field in which we are operating, we see a lot of opportunities. So that is not on the table right now.
Hitesh Agarwal
Okay. Okay, so just want to like squeeze. One last question. So how does your bid success rate compare between domestic and overseas tenders? Can you just give a little bit idea on that?
Rajiv Goel
So in India, you know, you. We all are aware that the entire Bombay High oil field is owned and operated by ogc. And as far as ONGC and Bombay High oilfield is concerned, we are totally secured for the next four years with our ongoing tenders on the east coast which is a far we have already seen working there in India right now at number one position in terms of preference credibility from the customers. And as far as the Middle east is concerned. So now that we have had our entry into the field to plan that.
operator
Sorry to interrupt you sir. Your voice is breaking sir.
Rajiv Goel
So I said that you know now our plans for the next five year vision is to add more DSV vessels in the fleet to expand our presence in the Middle East.
Hitesh Agarwal
Okay. Okay, sir. Got it. Thank you. Thank you sir.
operator
Thank you sir. The next question is from the line of Jaishree Bajaj from Trinetra Asset Manager. Please go ahead.
Jaishri Bajaj
Thank you for the opportunity. As with order ver shells like CIC 2nd, 3rd and the Princess are still in operation. How are you balancing maintenance cost with the replacement capex and what is the preferred ROP below which you would you had retire.
Rajiv Goel
So as of now, if you see the past three years. So this is a very good question and I thank you for that. You know, so we have been actively monitoring the aging aspect of our vessels. We have brought in CMAC Palladine, we have brought in Swordfish, we have now brought in Nusantara. We have now brought in CMEC Anant which is brand new vessel. So with the addition of these four vessels, what we have scrapped is CMEC1, an old vessel. The plans are now there to, you know, CMEC2, SEMAC3 and CMEC insects. They might run out of operation in the next five years as far as our vision is concerned.
And that will be done by adding more vessels, new, newer vessels, younger vessels to the fleet as far as their ROI is concerned. So these vessels, you know, the book value is almost nil because they have been almost, almost fully depreciated. And it is only a matter of adjusting my revenue against the OPEX cost of maintaining these vessels. And if I say you very plain break Even of even $30,000 per day, you know, gives me almost 25% return on the operations of these vessels.
Jaishri Bajaj
Thank you sir. That’s a detailed answer. Next question is performance of this quarter is very good. And so how you are planning to sustain this property profitability for the next for FY26 and next financial year after divestment of loss making Dubai assets.
Rajiv Goel
See, the idea is that we, our diving support vessels are put to use in more consistent and continuous manner. Since Swordfish is on a two year contract, CMAC 2 after the dry dock will work continuously. Paladin is on a continuous contract. With the addition of Nusantara and Anant, they will also be on a long term contract basis.
So we believe that our vessels will work on longer contracts in higher velocity than previously. This will help both in terms of consistent performance as well as growth for the company.
Jaishri Bajaj
Okay, thank you. Thank you ma’. Am.
operator
The next question is from the line of Rahul Chaturvedi from Nexa Group. Please go ahead.
Rahul Chaturvedi
Hi, am I audible?
operator
Yes sir.
Rahul Chaturvedi
Yes. So just wanted to understand beyond India, which overseas geographies are your primary growth targets in this year?
Rajiv Goel
So as I explained earlier in the call also, so we are now targeting Middle east, the oil fields of Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Bahrain, Oman. And in the last two years one of our vessels for phase has already successfully completed a charter of almost 15 months in Aramco. And now it has been redeployed for another two years in the same oil field. And now we are actively looking at expanding the fleet to have more vessels that can operate in these oil fields. And that is both expansion for the company in terms of top line and profitability.
Rahul Chaturvedi
Understood. And what competitive advantage do you believe we have compared to regional players in those markets?
Rajiv Goel
So you know, as we all know that when it comes to Indian products versus the global products. So our cost of production, cost of services are way cheaper. Whereas we maintain the same quality, same standards, same credibility in terms of delivering performance, in terms of delivering efficiency. And that is what is to our advantage in these two oil fields where we have all the global majors operating. Our experience of almost 25 years in the diving charter vessels, that is another added benefit to us, our core team which has remained intact for the last 20 years, the experience, the knowledge that they have, that is another benefit to us.
So on a consolidated basis, you know, CEMEX is well poised to explore this market and offer a very affordable and competitive rates to the global market.
Rahul Chaturvedi
Understood sir. And just wanted to check are we planning on something exploring some new technologies, maybe ROV EUV in this year?
Rajiv Goel
So one of our vessels, CMAC2 is already having an ROV on board. So we are actually using this ROV for almost like 10 years now. So we are not new to the ROV technology. But then these technical adjustments are far because of the customer demand rather than my wish list. So if, if my customer really wants me to use an rov, wants me to use some AI based technical equipment, I will be more than happy to do that. And we have the enough expertise and experience to operate such technical equipment.
Rahul Chaturvedi
Just wanted to understand, does that help in operational improving operational efficiency if we use those technologies, even if our it.
Rajiv Goel
Is not a question of my operational efficiency, it is more a question of the cost of production that the customer is bearing. We all know, you know, if we use more and more advanced equipment, the cost of production will definitely go up. And for the customer side, at what cost of production? He really wants to, you know, to engage in crude oil extraction. So if he’s ready to spend more money, I am ready to provide the service.
Sunil Gupta
Secondly also this, this is dependent upon the kind of fields that we operate in as we go deeper. Definitely the requirements will be met as and when needed.
Rahul Chaturvedi
Understood? Understood. Thanks. That’s that. That would be all from my side. All the very best. Thank you.
operator
Thank you sir. The next question is from the line of Deepak from Alpha Fund. Please go ahead.
Deepak
Thank you sir for the opportunity. My first question is the insurance claim for Female diamond boosted revenue. So what was the nature of the claim and how much we have received and are there any recurring risk to the vessel operations?
Rajiv Goel
So you know, when we brought this vessel, CMAC diamond, at that time there were certain maintenance issues for which we incurred a significant amount. And those breakdowns were covered under the insurance policy, comprehensive insurance policy for the vessel. And subsequently, once the work was carried out and the vessel was sent to the field, we launched our insurance claim. The expenses were booked in the previous quarters and after thorough verification, as the process is, we have received our insurance claim. So this insurance claim is therefore treated as other income in our quarter. And this is a full and final claim against the expenses incurred.
And as such, no further claims are expected from the insurance company for Cement Diamond.
Deepak
Okay, sir. And secondly, the next question is regarding the exit from the tunnel construction. The JV was returned after 80% completion due to unavoidable circumstances. So what were these? And does the signal a strategic refocus away from the diversification?
Rajiv Goel
So that tunnel project is already over for us. As far as we are concerned, that was another significant experiment undertaken by the company to venture into the field of EPC construction in infrastructure projects. And because that project was, you know, we were doing it for the lnt, which is one of the major Indian company into the infrastructure. So we undertook this project. But as far as we now understand it that we are, we are, we should focus primarily on our MSC operation, the subsea operation. And as such we have closed the project and we have accounted it.
Whatever were the losses were, they have all been provided in the books. And we have no intention to enter into the infrastructure as of now in the vision five year for us.
Deepak
Okay, sir. And sir, lastly, the JV in the Gift City is nascent. So what revenue contribution is expected from the new cargo vessel? And how will the 50% equity partnership with shipping affect margins?
Rajiv Goel
So it is, it is. See this. This particular project was brought by ARID Shipping. It was again a very good opportunity to work in India. And Gift City is an initiative taken by the government of India to enable Indian companies to save the taxes. So we have our Dubai subsidiary which is already operating bulk carriers outside India. We got an opportunity to work within India and with saving our taxes. And that is why we have formed this JV with Erik. So Eric is not only a financial partner, it is also a partner who is bringing in work through its experience, through its contracts in the bulk area where our presence is not very significant.
We are primarily DSP operators. This is a business model in which, you know, we are getting this free return in terms that we are into a bareboard charter where the risk of operations is not on us. So I. They will not contribute very significant returns. But a vessel operating company, instead of investing in treasury at 7 or 8% if it gets a better return of 15 to 16% in the bulk carrier business. And also you know starts making a name. So I think that’s a better financial planning for the company.
Deepak
Okay, so thanks a lot. Thank you.
operator
The next question is from the line of Raj Patel from RK Securities. Please go ahead.
Raj Patel
Hello. Am I audible?
operator
Yes sir. Yes sir please.
Raj Patel
Thank you for the opportunity. So few questions from my side. I just wanted to know that. Can you throw some light on the current pipeline of the conform contract for the rest of the year. For the rest of the financial year. And what is the percentage of the revenue that we have already secured versus the still progressing.
Rajiv Goel
As I mentioned earlier, CMAC Paladin is on a long term contract. There about three years are still ahead of us in terms of swordfish. It has a two year contract which has started recently. Nusantara and Anand are on long term charter.
Once they are acquired and put to use, they will have about three to four years of remaining contract period. CMAC 2 contract is about I would say till March 26. And CEMAC 3 and CMAX Princess are currently deployed on spot market requirements. Our bar deplorious works in seven months which is non monsoon period every year. I hope I have clarified about contract years.
Raj Patel
Okay, understood. And how does our order book look like as we as if we compare it towards the last year. And what is the weighted average duration of the current backlog?
Sunil Gupta
See our order book is strong.
As I just mentioned we are requiring two more vessels. So definitely the order book has expanded with those contracts of three to four years life. Remaining contract life. Okay. And as Rajiv ji mentioned, all the vessels are currently in deployable state and are deployed. So technically we are fully occupied.
Raj Patel
Okay. And my next question was that you mentioned that CMAC3 lease rate was $2,800 per day under the BM Bimco chatter party. So how does this being compared to the prevailing market rate? And are there any rate of improvement in near future for the upcoming contracts?
Rajiv Goel
No, no. I am sorry but CMAC3 rates in the entire last season was on an average of $50,000 per day. This $2,000, you know from wherever you’re getting. I am very sorry if it is mentioned. It’s a totally typo error on part of any presentation that the company has made. And in the coming season also we are expecting similar rates. So we are not at 2800. $2800 per day. Is. Is not. Is not even. Is. Is nothing. It’s. It’s the maintenance cost of the vessel actually. Okay, I’m very Sorry for any such typographical errors on our part.
Raj Patel
Okay. And have we been able to secure the escalation clause linked to the inflation or fuel price? And what will be the percentage of our current fleet operate under the fixed versus the spot rate?
Rajiv Goel
So as of now there’s only one vessel which we have kept aside for spot rates. Almost three, four vessels are on four year contract. One vessel is on two year contract. And during this contract durations we are not allowed to increase the charter hire that is fixed. And we take that into account when we are calculating our prices for the entire five year period. So when we work out an average price spread over 5 where ECP margins will be higher. But by the time the fifth year comes because of inflation, the cost increases, but the charter remains the same.
So all those adjustments, size adjustments, they are all well taken care of when we are bidding for a particular tender. In terms of operational efficiency in quarter one, our efficiency was almost 90%. In quarter three and four for the coming season we have already secured contracts for almost all the vessels. So that is why we are very confident on FY25 26 in terms of fleet deployment.
Raj Patel
Okay, that was all from my side. Thank you.
operator
Thank you sir. The next question is from the line of Darshan Shah, an individual investor. Please go ahead.
Darshan Shah
Hi sir. Thank you for this opportunity. Am I audible?
operator
Yes sir, you are audible first.
Darshan Shah
Congratulations on a good set of numbers. I had a couple of questions based on what you told the previous participant that you have one vessel kept aside for the spot market and the rest of are tied in the long term contract. Now this Emac Princess has been demobilized for for the upcoming monsoon season. How does this affect utilization rate in Q2 as well as margins? Because I think in the presentation you’ve also guided to the fact that better margins was due to higher utilization of CMAC Princess. So just can you throw some color on that front please?
Rajiv Goel
So you know the Indian market, the monsoon season starts somewhere in the last week of May and it ends in September. And this is something which is constant. So if you see all through our last 10 year results, this quarter two is the mountain season where you know, the fleet deployment is very minimal. And this particular period is utilized by the company for the maintenance of the vehicle. And this is not confined to me, it is confined to the entire offshore fleet market in India. So quarter three, quarter four and quarter one, that is where the an almost 95%, 90% of the revenue happens.
That is where the focus should be in, in ensuring complete fleet deployment. So CMEs Princes have completed ERP 7 in June 2025 and now we have been awarded contract work for PRP 8 and this vessel is expected to go back to the field in the month of October to start work on PRP 8. In fact, just to add, we were also part of PRP6 and PRP5. So this vessel has been continually operating in this PRP series of work for LNP and next season and then 26 and 27 is also booked for PRP.
Darshan Shah
Got it. So as investors, I think your guidance to us would be not look at it from a quarterly perspective but more from a year on your perspective. Because then Q2 would be monsoon affected last year also.
Rajiv Goel
So then that gives us better if you see quarter 2 numbers in any of the past 5 years. So the revenue is very minimal, the cost is almost there and that is a quarter where the company’s maximum focus is to remain break even, you know, not to incur any losses in the quarter.
Darshan Shah
And any specifics on cost control measures that you’re going to take for, you know, to, for the whole year, FY26, to kind of maintain margins above FY25 for the full year. So any changes, any cost control measures, any currency hedges that you’re going to.
Rajiv Goel
Undertake, see, you know, running a fleet of old vessels, what is a, running a fleet of a young vessel is always cost effective. A maintenance cost on old vessels quite high. And that is what the company in the last three years has undertaken. So it is coming out of running the old, the fleet of old vessels but deploying new vessels. And you can very well see that our maintenance cost is continuously on a downward trend then in the terms of crew deployment. Whereas our earlier fleet was confined to say six or seven vessels, now it has gone above 10 vessels.
So we have more command on the crew wages. And in fact the company is actively working on creating a pool of the crew crew that is required for the entire fleet so that going forward, you know, we are not hit by abnormal increase in the crew.
Sunil Gupta
Also as Rajiv mentioned earlier, reducing the dry dock period, doing the dry dock effectively adds to the overall profitability and efficiency of the business.
Darshan Shah
Got it, sir. So next would be is this the company’s policy to give some revenue guidance and margin guidance for the next couple of years or at least for FY26 so that we get a sense how, you know, what is the direction that you see internally where the company would be moving.
Rajiv Goel
See, there are various research reports which you can refer, however, you know, the business is quite volatile. While you have seen this quarter number and we are very confident on growth in terms of revenue and profitability, I would restrain myself of giving any guidance.
You can refer to research reports. They’ll give you enough color on the subject.
Darshan Shah
And finally, last, I think there’s a couple of good macro things that have happened for the oil and gas exploration in general. I think there was an article in May, ONGC finding new oil and gas reserves and then the Petroleum Minister’s commentary on, you know, basically opening up the no go zones and about two and a half lakh of square kilometer area that they’re going to kind of explore under oalp. So all of that, you know, are there any more potential revenue possibilities on that front? How is the, you know, any other news or companies evaluating in terms of some more business that can be generated from all of these government initiatives?
Rajiv Goel
So, you know, these are definitely very positive news for the company. But as a business, we are a company which is into the maintenance of the oil fields. So once the crude oil is actually started extracting from the bed of the seabed or the onshore bed and the oil field has been set up, it is then that cement comes into operation as far as, you know, exploring new oil opportunities or you know, installing the oil field and the oil platform is concerned. So if all these things are initiated by the government of India, we are quite hopeful that all these will, you know, transform into oil fields over the next five to seven years.
And that is where then CMEC will come into operations and provide its services and keeping that in mind. And the other thing is the Middle east market that we are quite focused on. We have actively, you know, plans for expanding our fleet.
Darshan Shah
Got it. So it’s quite encouraging to know that you have a great good visibility ahead of you. Thank you for all the detailed answer. Thank you.
Rajiv Goel
Thank you. Thank you.
operator
Thank you. Sir. The next question is from the line of Deepak from Alpha Fund. Please go ahead.
Deepak
Sir, thank you for taking my question. Just a follow up question on the question asked by my colleague. Just want to understand that is this an industrial practice to have that 3% piece of MMD? Because this is something which I just want to understand what value addition MMD is building on for our company right now. So don’t you think this will be a much more investor friendly if you can remove those fees.
Rajiv Goel
So you know, as far as industry practice is concerned. So as I said earlier during this call also, so this is related party transaction, we have engaged Grant Thornton to work out a comprehensive Related party transaction review. They have completed their study. They are expected to submit their report in the coming weeks which will be shared with the investors. This is a standard industry practice. The fees that we are paying to MMD is well within the market benchmark. In fact it is lower than the mean of the market. The value addition of MMG is tremendous because they bring with them lot of expertise, knowledge, contact and their advisory in deciding the value of the contract.
So while when we are working on the charter hire aspect of the tender that is where they bring their value addition. When we are deciding on our treasury operations that is where they bring their value additions. When we are deciding on the dried up cost, selection of dried off that is where they bring their value additions because they have been actively engaged with the company for the last 15 years or so. So the value addition is definitely there. The fees benchmark in the eyes of the management is well below the market industry benchmark. And I am very hopeful that Grand Total in its report will definitely vouch what we are trying to project here.
Deepak
Thank you sir. So just a question on the London part. If you can explain in detail how the, what is the thought process there right now on that investment? We have done it.
Rajiv Goel
So again as I, as I said in my call earlier, so the UK investment, there are two aspects to it. One is to set up a global office because we really want to explore the North Sea markets, that is the North Europe compromising of the North Sea and the allied areas. And the other part is that part of this investment will come back to India once this particular development project is completed. So our original timeline for completion of the project was March 25. But for approvals and reasons beyond our control and especially what is the geopolitical situation, you know.
So this, this, this has delayed by a period of almost 12 to 15 months. But the impact on cost is very minimal here. We are not seeing any very significant increase in the project cost. So overall strategy remains the same. That part of the proceeds will come back to India and we will have a global office to explore the North Sea market.
Deepak
Thank you very much sir and I hope we are going to see this, these solutions as soon as possible.
operator
Thank you sir. Ladies and gentlemen, due to interest of time, that was the last question for today. I now hand the conference over to management for closing comments.
Rajiv Goel
We thank all our investors who have supported us so far. We are confident that we shall demonstrate sustainable growth and value for our stakeholders. Thank you and see you in the next quarter.
operator
Thank you sir. On behalf of Arihant Capital Markets limited. That concludes this conference call. Thank you for joining us. And you may now disconnect your line.