Welspun Enterprises Limited (NSE: WELENT) Q3 2025 Earnings Call dated Feb. 04, 2025
Corporate Participants:
Salil Bawa — President of Group Investor Relations
Sandeep Garg — Managing Director
Saurin Patel — Managing Director – Welspun Michigan Engineers
Lalit Jain — Chief Financial Officer
Analysts:
Vaibhav Shah — Analyst
Unidentified Participant
Vishal Periwal — Analyst
Koustubh Shaha — Analyst
Parth Thakkar — Analyst
Yash Dedhia — Analyst
Diwakar Rana — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Enterprises Limited Q3 FY ’25 Earnings Conference Call hosted by JM Financial. As a reminder, all participant lines will be in 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 conference is being recorded. I now hand the conference over to Mr Shah from JM Financial. Thank you, and over to you, sir.
Vaibhav Shah — Analyst
Thank you. Thank you,. On PF of JM Financial, I welcome everybody to Q3 FY ’25’s earnings conference call of Welspun Enterprises Limited. I will now hand over the call to Mr Salil Bawa, Group Head, Investor Relations of Welspun World. Over to you, sir.
Salil Bawa — President of Group Investor Relations
Thank you. Thank you,. Good morning to all of you. On behalf of Welspun Enterprises Limited, I welcome all of you to the company’s Q3 FY 2025 and Nine-Month FY 2025 earnings call. Along with me today, I have Mr Sandeep Garg, Managing Director of Welspun Enterprises; Mr Patel, Managing Director of Welspurn, Michigan Engineers Limited; Mr Abhishek, Chief Executive Officer of Welspun Enterprises; Mr Lalit Jains, Chief Financial Officer; and I also have, who has just joined us as lead Investor Relations. We hope you have had a chance to review the investor presentation that we filed with the exchanges yesterday. The presentation is also uploaded on the company’s website. During today’s discussion, we may be making references to this presentation. I’m sure you will take — you would have taken a moment to review the safe-harbor statement in the presentation. As usual, we’ll start the forum with the opening remarks by our leadership team and then we’ll open the forum for your questions. Once the call gets over, should you have any further queries that remain unanswered, please feel free-to reach-out to us. With that, I would now like to hand over the floor to Mr Sandeep Garg, Managing Director of Welspun Enterprises. Over to you.
Sandeep Garg — Managing Director
Thank you,. Good morning, everyone, and thank you for joining us today. Welcome to Welspun Enterprises Q3 FY ’25 results conference call. We appreciate your time and participation. Before I go to the company-specific discussion, I would want to state that the Union budget is positive for us as a company and as well as the industry. The focus on public — private partnership, PPP is the extension of Jal Mission the government’s decision to grant access to the PM Gathi data the 1.5 lakh crore interest fee loan to states and partial credit guarantee schemes to ease the funding for the projects. Are all transformative actions which augur well for the company. We at Welspun Enterprises are excited to contribute to this ambitious growth agenda of the government and we will continue to work to strengthen India’s infrastructure backbone for a sustainable future. So having talked about the union budget, I would want to come to the financial performances. I’m pleased to report that we have sustained our growth momentum for this quarter. Our consolidated income for this first-nine months of FY ’25 stands at INR2,717 crores, reflecting a 24% increase compared to the same-period last year. Our EBITDA for the same-period is INR523 crores, a growth of 14%. Our subsidiary, Michigan Enterprise Limited or WNEL has also delivered strong performance with revenue of INR403 crores, a year-on-year increase of approximately 49% and Mr Patel, MD of WMEL, will provide further insights into the company’s performance in his opening remarks. Looking ahead, we reiterate that we will be closing FY ’25 with a consolidated EBITDA of approximately INR700 crores. At the standalone level, we are maintaining a cash reserve of approximately INR840 crores, which positions us well to drive our future growth strategy. MR. Lalit Jain, our CFO, will share more details on our quarterly performance shortly. I’m also very excited to talk about the strategic initiatives and technological innovations that the company has embarked upon. Our subsidiary has made significant strides with the SmartOps technology and innovative solution in waste water and water treatment. We recently secured two new orders for its deployment in Pandapur, Maharashtra and Bharana CUP. This technology will help address India’s water treatment challenges in sustainable manner and will provide more details shortly in his exciting of this exciting initiative coming to the order book, I’m pleased to announce that our consolidated order book stands at INR14,500 crores, of which around INR9,300 crores is comes from water, about INR1,950 crores from tunneling segment and remaining INR1,750 crores from transportation sector. The closing order book of WML stands at INR1,500 crores, excluding the orders which are awarded by WL to WNEL in-line with our strategic growth areas, we have secured an order of INR1,989 crores to construct our water conveyance tunnel from Dharavi to in Mumbai. This project complements our ongoing work at STP. We will implement this project through, Michigan, leveraging their expertising — expertise in. We are also declared — we were also declared L1 for MMC 11 road project by MSRDC. However, due to delays in the project award, we are not incorporating it into our revenue forecast until there is a clarity. Please note that this project was never considered in our order book of INR14,500 crores. On the execution front, I’m happy to report that all our projects across the water and transportation and WML sectors are progressing according to schedule. We are on-track to achieve provisional completion for Road HAM project by the end of this financial year. Talking about our moving ahead growth strategies at Enterprises, our long-term vision is to build technology-driven end-to-end water solution company, we aim to become one-stop shop for water infrastructure offering integrated solutions that encompass treatment, conveyance and smart management our water strategy revolves around four pillars, transmission, treatment, distribution and O&M services. With, Michigan as a technology-focused arm, we are integrating cutting-edge solutions like to enhance both project efficiency and sustainability. Through these synergies, we aim to redefine sustainable water management in India in the transportation sector, we have built a strong foundation in the road infrastructure, expanding from HAM projects to BOT and EPC models while maintaining an asset-light approach. Moving forward, our growth strategy focuses on two key areas BOT toll and large-diameter tunneling. Now looking at the future projections, the — we are aligned with the government ongoing focus on infrastructure and backed by our asset-light model and cash-rich balance sheet, we remain optimistic about future bidding opportunities. We have identified over INR6 lakh crores worth of projects across key segments over the next five to seven years. This includes opportunities in water supply, wastewater treatment, water transmission, BOT toll projects and large-diameter tunnel line. The robust pipeline reinforces our projections. We are on — and we are on-track to close FY ’25 with a consolidated order book of — in the range of INR1,500 crores to INR20,000 crores depending upon the timing of awards. With this, the consolidated foundation, we anticipate a consolidated total income growth of anything between 18% to 20% in the next three years. I would also want to talk about the sustainability, which is a cornerstone in our strategy. As a part of our commitment to sustainable development, we our inaugural sustainability report last month themed transforming Infrastructure, advancing sustainability. This report highlights our dedication to excellence, showcasing of how we integrate ESG principles across all our operations. It also outlines key initiatives in circularity, resource efficiency, renewable energy and strategic technology collaborations. Our efforts have been recognized across the industry at SHM Infrastructure Conference and Awards 2024. Our Road Project won the Excellence in Project Management Award. Additionally, Westboro Enterprise was named the construction and Infrastructure Company of the year at the Construction Awards 2024. Further, WMEL received the best tunnel project of the Year award at the SV Road Sever for the SV Road Turnal project at the construction Times Award 2024 and the Innovative Project Design Award for rehabilitating a 100-year-old strongwater rain using geopolymer lining at the Trenchless Excellence Award 2024. With this, I now hand over the call to Mr Saurin Patel, MD of Westmun, Michigan and Head of Water Vertical in WEL, who will provide more insights into the progress of our water sector projects.
Saurin Patel — Managing Director – Welspun Michigan Engineers
Thank you, Sandeep, and good morning to everyone. Over the years, we have established ourselves as a trusted engineering solutions provider for water infrastructure, a specialized niche. Building on this expertise, we aspire to scale our presence in specialized areas such as tunneling, water improvement and water delivery projects on a larger-scale. The Darabi wastewater treatment facility is advancing well with the SBR raft complete and the first flows lab at 80%. The administrative building is finished and the site office has relocated. The IP — I pumping station shore piling is ongoing with challenges from unmapped utilities, but equipment from our JV partners ylum is arriving and client approval for the thermal hydrolysis process has been secured. This project aims for completion by the 3rd-quarter of 2026 ahead of schedule. In the Bandu quarter treatment plant, external approvals which are mandatory from the forest authorities and ecosensitive zone committees are in-progress. A site office has been established and the excavation contractor bids have been finalized. Work is expected to start very soon for the tertiary treated water conveyance tunnel project that was awarded to us just a few months ago. The work spans 93 months and it includes constructing an 8.48 kilometer tunnel and two deep shafts with a maximum depth being at 152 meters. Our TBM has been finalized and an MOU and order has been placed. This delivery is expected in 16 months and it will be just-in-time once the shaft completion project has been executed. The necessary permissions are being processed and we expect a four to six-month process time for such permissions to be granted. Now for some exciting news, Welspan, Michigan Engineers has successfully launched Smart Ops, a JV which introduces the revenue street new technology in the area of water treatment. This technology is modular, scalable, cost-efficient and easy to deploy in a water body or drain point to rejuvenate or recycle water. With this new business, we endeavor to create an alternative approach to address the huge problem of an estimated 63% of India’s sewage being released untreated into the environment. I’m extremely happy to share that we are about to hand over two prestigious projects executed using this technology. One is a rejuvenation of the Holy Duruga in Varanasi, Uttar Pradesh and the second is on the River at the Vittal and Panderpur Maharashtra. In both cases,, Michigan will significantly enhance the experience of thousands of devotees who worship and perform rituals at these sites of religious and tourism significance. This new business line is expected to be rolled-out pan-India and we are creating an organizational structure commensurate with the huge opportunity we see waiting to be tapped. On the financial front, our WMEL order book as on December 31, 2024 is INR2,600 crores. The order book entails 23 projects which are spread across large dire tunnels, micro and segment tunneling, marine works, rehabilitation of sewer lines and bridge construction and is largely executable over the next 36 months, excluding the single large tunnel project, which has a 93-month period of execution. Coming to the key financials of the concluded quarter, WMEL has delivered revenue of INR155 crores, thus taking our Nine-Month FY ’25 revenue to INR403 crores, marking a spectacular growth of 49%. I’m confident that we will continue the execution momentum into the financial year and endeavor to better the guided 30% growth for FY ’25. This performance has been consistent from a margin perspective. Our EBITDA margin works out to be approximately 23% for the nine months FY ’25. With this, I will close my remarks and hand the call to Lali Jain, CFO of Enterprises for updates on financials.
Lalit Jain — Chief Financial Officer
Thank you,. Good afternoon to everyone and many thanks for being a part of this call. As our MD shared, on a constant basis, we have delivered INR919 crores of total income for Q3 FY ’25 against INR754 crore in Q3 FY ’24, which is a growth of 22% year-on-year. The Nine-Month FY ’25 consolidate income is INR2717 crore, which is a growth of 24% over Nine-Month FY ’24. Our consolidate EBITDA for Q3 FY ’24 — FY ’25 is INR180 crore against INR174 crores in Q3 FY ’24. This EBITDA works out to margin of 19.6%. The Nine-Month FY ’25 consolidated EBITDA is INR523 crores against INR460 crores, which is a growth of 14% over Nine-Month FY ’24. At consolid PBT for the quarter is INR117 crores and our profit-after-tax for the quarter is INR77 crores. At the consolidate level, we reiterate that our EBITDA for financial year ’24-’25 is expected to be INR700 crores and ROCE is expected to be 17%, which does not include the expected gain on the sale of completed assets. On a standalone basis, for Q3 FY ’25, total income is INR709 crores and EBITDA is INR105 crore. Profit before-tax on a standalone basis is INR95 crore, while PET is at INR69 crores. Our EBITDA margin is at healthy 14.8%. Please note that in Q3 FY ’24, we have recognized a claim from EPC business, which resulted in a higher EBITDA margin of 20% in last financial year. We have a strong balance sheet as demonstrated by our standard — standalone net-worth of INR2604 crores as on 31st December 2024. We remain debt-free on a standalone basis with cash of INR840 crores, which will allow us to grow double-digit to the next level. I would also like to inform you that the company was previously focusing on-road project, which accounted — accounted for significant portion of its revenue. However, in recent quarters, the order book has diversified to include projects in-the-water, Westwater, and rehabilation sectors. Along with the acquisition of Michigan, Engineers Limited, to reflect this expanded portfolio, management has decided to go to do segmental reporting starting with quarter two FY ’25 for each vertical, namely water, transport, tunneling and rehabilization. I would like to take you all through the segment-wise revenue numbers for Q3 FY ’25. Out of total consolidated operational revenue of INR867 crores, INR328 crore comes from transport. INR365 crores is contributed by and the balance of INR174 crores is being contributed by tunneling work. With this, we can open the forum for question-and-answer. Thank you.
Questions and Answers:
Operator
Thank 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 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. The first question is from the line of Shah from JM Financial. Please go-ahead.
Vaibhav Shah
Yeah. Thanks for the opportunity, sir. Sir, firstly, on the balance sheet side, what would be our consol and standalone debt as of December?
Lalit Jain
Control debt is INR1,122 crores and we don’t have a end yet on the — at standalone level.
Vaibhav Shah
I think there was around INR180 crore debt as of September quarter advance of INR180 crore
Lalit Jain
INR169 crore from the actives for the 51% MCP stack which we are going to sell. So this is advance, which is interest-bearing, it will come — it will be adjusted against our consideration of 51% when we sell this.
Vaibhav Shah
Okay. And sir, what would be your order inflow in the nine months and how much we are targeting for the entire year.
Sandeep Garg
So the order inflow at Enterprises level standalone has been about INR2,000 crores in the FY ’25. As I had in my opening statement mentioned, we had opened L1 for about INR1,850 crores worth of project, which because it is delayed in award, we are — we have never considered in an order book, but we are also not taking it away from our projections till the time the clarity comes in. Based on these guidance, we anticipated that we will be having an order book of about INR6,000 crores addition. However, given that this INR2,000 crores may not come and certain projects are delayed in award, we are not very hopeful that any new award will come in the current financial year.
Vaibhav Shah
So FY ’25 should be around INR2,000 crores in terms of inflow.
Sandeep Garg
Yeah. We expect the — this spillover to be met in the Q1 of FY ’26 because the projects that we were anticipating will be bid-out in this year are slightly behind schedule.
Vaibhav Shah
So what would be our target for FY ’26 in terms of inflows?
Sandeep Garg
We believe that we should be able to make-up for this loss of about INR4,000 crores plus the additional INR6,000 crores in FY ’26. So we should be in somewhere between INR8,000 crores to INR10,000 crores order book in the FY ’26.
Vaibhav Shah
So what — what should be the broad mix of the inflow that we are targeting for next year? Highway should be somewhere around, 30%, 40 odd percent?
Sandeep Garg
Yeah. So we would — we expect about 35% to 40%, 35% to be the transport vertical and the balance should come from the water vertical.
Vaibhav Shah
Okay. And sir, secondly, on the industry side, what is the current pipeline on the — especially in-the-water segment?
Sandeep Garg
So water pipeline is pretty strong, as I said in my opening statement, we see a lot of orders coming through going-forward in Maharashtra, in MT, in Rajasthan, in Odisha. So we see a lot of order and orders being announced and bids being expected in anything between 45 days to about three months period. So we see a lot of work coming in.
Vaibhav Shah
And anything on the competition front, have you seen some increased competition over the last three to six months?
Sandeep Garg
In the kind of segment, in the kind of projects that we participate, there is our limited players because you need technical qualifications etc so we don’t see very intense competition. We don’t participate by design-in areas which are intensely competitive.
Vaibhav Shah
Okay. Great. Thank you, sir. Those are my questions. I will come back-in the queue.
Operator
Thank you. The next question is from the line of Nirvana Laha from Badrienath Holdings. Please go-ahead.
Unidentified Participant
Hi, thank you so much for the opportunity. Sir, my first question is on the discontinued operations losses that we are booking. So what is the status of approval here and when are we expecting to dispose of this asset and how much more losses are left to be booked?
Lalit Jain
This is with respect to our MCP project, which we have sold-out to is 49% we already sold-out and remaining 51%, we are expecting COD in the — within three to four months. Once we receive the COD, then we have to apply for the NHA approval once it comes and then we are expecting this to close the deal in FY ’26.
Unidentified Participant
Okay, sir. And how much more losses do you anticipate to book in the next two years?
Lalit Jain
Discontinued operational losses are not practically — this is only national loss. We don’t see any loss on this account. But for the accounting purpose, we have to consider. So this will be, you can say, INR24 crore, INR25 crores INM, these are the type of discontinued losses income level.
Sandeep Garg
Just to add to what Lalit has told, we anticipate in the H1 of FY ’26 this deal — this whole transfer to take place and this notional loss that we are making will get rewritten in once we — once this the equity of 51% is transferred to.
Unidentified Participant
So it will be reversed when the transaction is consumed.
Sandeep Garg
Yes, yes, yeah.
Unidentified Participant
Okay, okay. So a few questions on your P&L. So in this quarter, the other income has spiked quite a lot. It’s gone up to 16% from 10% in the Y-o-Y quarter. And if I look at the segmental results, the EBIT margins for the water segment have really come down 21%, against 33% Y-o-Y. So what led to this?
Sandeep Garg
So the other income has two components. One is a component of the our treasury income. The other component is the —
Unidentified Participant
Sorry, I meant other expenses. Other expenses have spiked from 10% to 16%, not other income.
Lalit Jain
For other expenses, you have to consider both the things, cost of material subcontracted and put together and then you can compare because sometimes other expenses are like you know, we are designing expenses also we are accounting on other expenses. So this is part of our subcontracting cost only. So you need to compare with putting all three heads at one place, cost of material, subcontract and other expenses, then you will be able to compare properly.
Unidentified Participant
Okay. So only combined, it makes sense to compare…
Lalit Jain
Quarter-to-quarter.
Unidentified Participant
Correct. Okay. And what led to the big spike in finance costs? And how can we see this number panning out finance?
Lalit Jain
Basically, if you see in the consol level, finance cost has increased because we have drawn the debt at SPV level. We have HEM project SNRP and Anta. So we use — we draw the around INR500 crore in the — in SNRP projects. That’s why the finance cost is increasing.
Unidentified Participant
Okay. Got it. And last question, if I may. So the opportunity that you’re seeing in terms of the water order book, you mentioned INR6 lakh crore across water and road. The water opportunity itself, I think in the annual report, you’ve commented it’s INR3 lakh crore or more. So can you sort of split this into what government schemes or outside of schemes, what segment how much of this opportunity you’re seeing and like is there a segment or a government scheme that’s going to be the bulk of this opportunity? Like where should we focus in terms of opportunity?
Sandeep Garg
Yeah. So that data is available that it is split into transmission treatment in the other O&M. So we — the segment — the segmentation of this is available and bulk transmission is about 40% of this pipeline and about 30% is treatment. The balance versus comes from other distribution, etc., etc. So this is what the split is. There are micro-level.
Unidentified Participant
So transmission includes only tunneling because JJM, I think will be under the distribution this thing, right?
Sandeep Garg
So the transmission will include tunneling as well as the piped transmission and which is which is part of our portfolio.
Unidentified Participant
So the UP project would be classified under the transmission okay.
Sandeep Garg
You can is a distribution project.
Unidentified Participant
Okay. All right. I’ll come back-in the queue. Thank you.
Operator
Thank you. Ladies and gentlemen, before we take the next question, a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Vishal Periwal from Antique Stock Broking. Please go-ahead.
Vishal Periwal
Thanks for the opportunity. One on Michigan side, how has been the order inflow in this year?
Sandeep Garg
Yeah. So Michigan has had a INR1,700 crores that we have received as incoming orders for the year. And we still have some contracts that we are L1. We are hoping that another INR200 crores to INR400 crores will come in before the March 31st fiscal deadline and add to this number. So we expect to-end the year with an order inflow of about INR1,900 crores.
Vishal Periwal
Got it, got it, sir. So at a consol level, then
Sandeep Garg
I would just want to add.
Lalit Jain
That includes —
Sandeep Garg
This includes the order which has been taken by Welspun Enterprises and subcontracted portion thereof to, Michigan. So in the contra, when we talk about consolidated order, this gets nullified INR1,000 crores in terms of consolidated order book.
Vishal Periwal
Okay. So in a consol level, the INR2,000 crore inflow, which you mentioned, that’s a standalone or consol or —
Sandeep Garg
So that’s a standalone at Enterprises level. That is why in my opening statement, I made the order book of Western Michigan to INR1,500 crores because I had excluded the order which came from Enterprises to Michigan.
Unidentified Participant
Okay, okay. And one last question. It’s more of a clarification. So the guidance of INR700 odd crores for FY ’25 and this includes other income, right, sir.
Sandeep Garg
Correct, correct.
Lalit Jain
That is correct.
Vishal Periwal
Right. And then probably what is the ballpark range of margin this works out in?
Sandeep Garg
Margins in terms of —
Vishal Periwal
The overall.
Sandeep Garg
EBITDA margins would be at an overall level be about will be about in 19% or there around at a reported EBITDA level.
Vishal Periwal
Okay, okay. Yeah, that’s all from my side, sir. Thank you very much.
Operator
Thank you. The next question is from the line of Shahar from Wallford PMS. Please go-ahead.
Koustubh Shaha
Hello. Hi, thanks for the opportunity. I had a question on the smart ops, the two projects that we have now kind of successfully done and handed over. So can you just give us a color as to know, was there any revenue booked and what were the margins? And how do we — and the second question was that when you’re saying that there will be a pan-India rollover, so can you just give us a color for FY ’26, what we should expect in terms of the orders or the top-line that was for the Michigan part.
Lalit Jain
Yes, sure. Thanks for asking this. The two orders of Varanasi and Panderpur will contribute about — between anywhere between INR43 crores to INR45 crores to our top-line sales in terms of fiscal year ’25. And we hope that we will achieve easily 100% to 150% increase for the next FY ’26 projection. Now the percentages that this brings to our EBITDA levels in terms of the earnings, we have a — we expect that we will not be earning less than 30% on the gross levels in terms of percentage profit margins. And considering that these are smaller projects and we are just ramping-up, we hope that this leads to a higher number in the coming years with the productivity and organizational increases that we are currently setting up. So pan-India, when you say we have no choice because the demand that we foresee for cleaning up water bodies and for making sure that the inlets coming into major usable water bodies are meeting entity standards, etc are so large that unless we are present in various geographies in India, we feel that we would be giving up on opportunity and that cost would be too high.
Koustubh Shaha
Okay. Sorry, so you said that in the next year, we should expect 100% to 125% increase in terms of the order flows from around INR45 crore around INR100 odd crores.
Lalit Jain
Revenue level, I think we would do anywhere between INR150 crores to INR200 crores of turnover from alone.
Koustubh Shaha
Okay, great. And just to reiterate the 30% is the gross margin and not the EBITDA margin, correct?
Sandeep Garg
Yeah. So if we would guide you to 30% gross margin, we will come back to with the EBITDA margin as the business matures.
Koustubh Shaha
Okay. Great. And second question was on the oil blocks. So how are we looking at in terms of the approvals? You have given the specified quantum that you’re expecting. And any capital commitment that would be required for this.
Sandeep Garg
So, and this question is a bit tricky, so but anyway, the honest answer is that we have not got the EDP approval that we were anticipating from the government despite four or five meetings during this — during the quarter gone by. So once the EDP is approved, then only can we estimate what will be the expense because the evacuation routes will be decided only based on the EDP approval. And the viability of the same and capital allocation thereafter will take place. So we still are a bit away from it as my anticipation. So it will take at least three to six months till before the government approves this.
Koustubh Shaha
EDP. Okay, except. And lastly, from a future perspective, what should we consider at a consol level the EBITDA margins.
Sandeep Garg
So EBITDA margins, at least for the FY ’25 will be in the ranges of 19%. So 19% plus is what I would say. And our future businesses as we speak are in the — our continued business. So we will be reporting similar numbers of EBITDA margin for the years to come.
Koustubh Shaha
Okay, great. That’s it from my side. Thank you. Thanks so much.
Operator
Thank you. The next question is from the line of Thakkar from JM Financials. Please go-ahead.
Parth Thakkar
Hi, thank you for the opportunity. Can you provide us with the revenue and the margin guidance for FY ’26 and also for FY ’27, if you can?
Sandeep Garg
So we expect the — our revenues and our margins to grow in the ranges of 15% to 20% year-on-year basis.
Parth Thakkar
Okay. And also during the 2Q call, we were still waiting for the necessary approvals and clearances for the Dharabi water treatment project. Have we received them yet? And how much can we expect on a full-year basis to book revenue on that?
Sandeep Garg
I — if I understand it correct, the question is more related to the Daravi tunnel.
Parth Thakkar
Yes, yes, sir.
Sandeep Garg
So if that is the question, then as addressed in his opening statement, we anticipate the approvals to come in next six months.
Parth Thakkar
Okay. Okay. Thank you.
Operator
Thank you. The next question is from the line of Yash Dedia from Maximal Capital. Please go-ahead. Go-ahead.
Yash Dedhia
Good afternoon, sir, and congratulations on the results. Sir, on the margins front, so it seems that overall, we are getting to a lower-margin trajectory even if we adjust for some of the one-offs in the 3rd-quarter of last year. So even if I look at 9M numbers, the margins are a bit tepid. So despite growing by 20% odd on the revenues, I think our PBT and all is relatively flat. So are we still looking for a growth of 15% to 20% at a PBT level for this year?
Saurin Patel
So the guidance is at the revenue and the EBITDA level now below the EBITDA lines, depending upon how the business is being ramped-up and certain costs are getting incurred for future, the PBT and PAT will accordingly get adjusted. But we expect that our EBITDA should grow in the ranges of 15% or there around year-on-year basis and similar numbers will be the revenue now situation. Below the EBITDA line because of the very nature of the businesses as they are in the growth phase or we are acquiring certain assets, the numbers at PBT and EBITDA will change.
Lalit Jain
So this is very gent. EBITDA margin remains as self suggested. While the CBT and paid-for this financial year will not be comparable with last financial year, there were some claims. So if you remove that claims, then it will be correct, that will be — there will be margin growth of 15% to 20% except that claims.
Yash Dedhia
Sir, how much should we adjust? How much was the claims?
Lalit Jain
Sir, around this INR20 crores something among was there. So if you remove that, then it will be — for the quarter it will get even completed.
Sandeep Garg
So there is a one-time adjustment on the Q3 as a — as was highlighted by Mr Lalit Jain in his address, in the Q3 FY ’24, there was a one-time adjustment of about INR20 odd crores. If you — if you that away, you will see the increase is consistent with the revenue.
Yash Dedhia
Okay, understood. And even in the — I am looking at your segmental, I think we — I think Mr Patel was mentioning that the EBITDA margin is 23-odd percent, but if we look at the EBIT percentage, it is coming to around 16% for 9M. So what is the difference in the two figures?
Sandeep Garg
So basically there are allocation of the corporate expenses due to that which is getting reduced otherwise if there is a difference between the project margin and at the net margin. So there were you can say corporate allocations.
Yash Dedhia
Just getting reduced. No, but your segmental will not have corporate allocations, right, that would be below the segmental, right? So I’m just looking at INR68 crore of EBIT on a INR422 crores that is coming to 16% EBIT percentage. And then how does it go — is the depreciation seven-odd percent?
Sandeep Garg
That we can discuss offline all these retails, if you want, we can discuss offline, please.
Yash Dedhia
Okay. And finally, just one clarification on the order inflows and order book. So we — we are saying that we’ll get INR2,000 crore more order inflow in FY ’25 and then INR10,000 crore is the expectation for FY ’26, which includes INR4,000 crores to be spilled over from FY ’25 to FY ’26.
Sandeep Garg
I think the message that I was trying to give was that we are not anticipating any major orders in this financial year at the WEL level. So there will be a spillover of almost INR4,000 crores from what we — the projects we were targeting into the next year. And next year, with this spillover included, we will be in the ranges of INR8,000 crores to INR10,000 crores order booking next year. That’s what our target is.
Operator
Sorry to interrupt, Mr Yash, I would request you to rejoin your queue for your follow-up question. Thank you. The next question is from the line of Animesh Podar from Wave PMS. Please go-ahead.
Unidentified Participant
Thank you for giving me the opportunity. I would like to see clarification on the cash flows. So last year, as of March 2024, the cash-flow from operating activities were negative. So are we closing this year with positive cash flows from operating activity and if you could just give me a ballpark number of, what will be the cash-flow from operations?
Lalit Jain
So at a macro-level, I can tell you we will be closing cash-flow and positive on from the operations. How was the exact number I think I may not be able to give you right now. I would suggest that if you could connect with the — with the IR team, they will be able to help you with that. Okay.
Unidentified Participant
And sir, do we expect to maintain the debt level on this level or are we expected to reduce the debt or maybe increase? I mean, how is the financial leverage playing out?
Sandeep Garg
So just to take you what Mr Lalit Jain said, we have practically zero-debt at the standalone level. However, the SPVs will — will have some debt, which they will continue to take as the progress happens.
Lalit Jain
One of the project which is Anta Simaria, which is likely to be completed in this financial year will be ready for a spin or a flip. Next year, we will try and see if we can split it next year. So that much of that will be reducing on the consol level.
Unidentified Participant
Understood, sir. Thank you. Thank you very much, sir.
Operator
Thank you. The next follow-up question is from the line of Nirvana Laha from Batrinath Holdings. Please go-ahead.
Unidentified Participant
Hi, thank you so much for another opportunity. So the orders that we are winning in Smart Ops, can you tell us a little about what kind of tenders we are winning them for? The reason I asked this is because is the tender actually dictating certain timeline of completion, etc., which is giving smart an advantage or are we still competing against the traditional way of constructing water treatment plants? So who are our competitors and what are these kind of tenders where-is doing well and is likely to do well going-forward?
Sandeep Garg
So the tenders which we win are tenders where we bring in a differentiation where the client is valuing both space time as well as well as the efficacy and reliability of the system. So an overall O&M is also something that its value. So anybody who’s doing a life-cycle costing and these key aspects is where we are likely to win. In terms of competing with the existing technologies there is no comparison because the timeline itself is very different for each one of them. So as against a — as against a conventional water treatment plant taking couple of years, we take about 45 to 60 days and wherein we — per MLD, the area requirement is about 150 square meters for us, which is almost three to four times of this for a conventional treatment plant. So anybody who is valuing these is where we will get a benefit and we should be able to position ourselves for those kinds of projects.
Unidentified Participant
Understood, sir. My question actually is that are the tenders already specifying these time and size constraints to our advantage or is it that the tenders are still generic in nature and we are still able to win them basis are bid. That is what I want to add
Sandeep Garg
We don’t — we don’t bid for generic trenders through this technology because I don’t think if there is no differentiation between the two, we will be able to — we would want to compete with that technology. So we will be selective in our bidding even in this case.
Unidentified Participant
Sure, sir. Therefore, the competitors we are coming up with, they also have similar technology, modular technology or they are competing with the older technology, right?
Sandeep Garg
At least to the best of my knowledge, there is no competing technology equivalent to this at this point in time.
Unidentified Participant
Sure. Thanks. I have one other question on the oil blocks, if I may. So apart from the Mumbai oil block for which we are pursuing FDP, what is happening in the other two oil blocks?
Sandeep Garg
So the — as I said earlier, the other block which is adjoining the Mumbai block is supposed to be evacuated, the oil and gas is supposed to be evacuated from the evacuation route which is decided for this particular block and hence these are co-terminus and there is no other block where we are otherwise operator so we are not in a position to comment upon it. And I hope — I mean, these are the two blocks that are of relevance at this point in time.
Unidentified Participant
Okay. All right, sir. Thanks for the clarification and all the best.
Operator
Thank you. The next question is from the line of Harsh from Eleigan Family Office. Please go-ahead.
Unidentified Participant
Yes. So I just wanted to confirm I heard the management correctly in opening remarks. Are you guiding INR700 crores EBITDA this year?
Lalit Jain
Yeah. So we are — we are reporting EBITDA shall be for INR700 crores or we are targeting INR700 crores, including the other income, total on a total base of total income.
Unidentified Participant
So are you also revising your revenue target of INR4,000 crores in FY ’25.
Lalit Jain
So no, we are not upward revising. It possibly will be slightly short of it because as I said in my opening statement, one of the orders, which we were anticipating has not matured and we were taking some — we have taken some forecast of revenue from that, which we will not be able to get.
Unidentified Participant
So by going by that, you will be needing at least like you have done INR368 crores of EBITDA in nine months. That leaves us with almost INR330 crores of EBITDA for Q4. And at the revenue run-rate of INR4,000 crores, that would be like 25% margins.
Lalit Jain
At least. So I think I would want to clarify this that the guidance is at the EBITDA level of the reporting. You seem to be excluding the other income from the related EBITDA there. So this is — this is the disconnect. I am giving you a guidance as against INR523, we will be at INR700 crores.
Unidentified Participant
Got it. Got it. Thank you so much. That was all. Thank you.
Operator
Thank you. The next question is from the line of Vignesh from Sequent Investments. Please go-ahead.
Unidentified Participant
Thank you for the opportunity, sir. I wanted to understand on the tax-rate side of it more on a consolidated level. So we would be, you know, doing — paying taxes at the rate of 30%, right, even going ahead in FY ’26 on a blended basis.
Lalit Jain
No, in terms of the standalone level, it is 25%. For some SPV, we have a 30%, but we are — it will be in the range of 25% to 27% at the end-of-the year. Sorry, going-forward?
Sandeep Garg
The question — the question is FY ’26 and FY ’27, we are going to look at these — our taxation strategy as to what we need to follow and we’ll come back to you once our strategies are in-place.
Unidentified Participant
Okay, got it. Got it. It. And also, sir, sorry, if I missed it earlier how would we be ending this year that is FY ’25 in terms of revenue.
Sandeep Garg
From anticipate the revenue to be somewhere close to INR3,700 crores total income.
Unidentified Participant
Oh, got it. Got it, sir. That’s all from my side and all the best, sir. Thank you.
Operator
Thank you. Thank you. The next question is from the line of Devakar Jana from Prudent Equity. Please go-ahead.
Diwakar Rana
Yeah. Hi, sir. Good afternoon. What is the nature of the one-time expense of is not
Lalit Jain
One-type expenses. This was the one-time.
Sandeep Garg
So I think the question is related to what you’re talking about INR20 crores is our other income that we had accounted in Q3 FY ’24, which is one-time income that had come in. I don’t think there is any clarification that we have given on one-time cost side of this.
Diwakar Rana
So okay. Sorry. So I thought there is a one-time expense of 27. You are saying it is other income, right.
Sandeep Garg
Of INR2 correct. That is correct.
Diwakar Rana
Okay. That’s all sir. Thank you.
Operator
Thank you. The next question is from the line of Nishant Gupta from Meneva Global Capital. Please go-ahead.
Unidentified Participant
Hello. Hi, sir. Sir, thank you for the opportunity. Just one small question. In the previous con-call, you had guided for a revenue growth over next three years in the range of 20% to 22%. This time you have softened that to 15% to 20% over next three years. So is it more like a cautious approach because the kind of opportunity you mentioned INR3 lakh crore in-the-water segment itself, that kind of indicates there is a — there can be a higher uptick. So what is the reason for softening this down?
Sandeep Garg
So why I have suffered this that the last eight months, the order inflows or order bids are slow, we would await when they come to their normal levels and then reguide rather than guide in advance of a growth. So more cautious about it. And once the intent of the government converts into actual work, we would — we would be happy to reconsider our guidance.
Unidentified Participant
Got it, sir. Thank you.
Operator
Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr Sandeep Garg for closing comments.
Sandeep Garg
Thank you. Thanks once again for coming — for joining us today. I hope we have addressed all your queries. We remain committed to creating long-term value for our stakeholders and our focus is on improving return-on-equity and return on capital employed. Should you have any further questions or feedback, please feel free-to reach-out to our CFO or Investor Relations team. Thank you. Good day.
Operator
On behalf of JM Financials, that concludes this conference. Thank you for joining us and you may now disconnect your lines.