PSP Projects Ltd Q2 FY26 Earnings Analysis

- PSP Projects is targeting significant order inflow from Adani Group for FY26, estimated between INR 7,000 to 8,000 crores, with ongoing bids potentially rising to INR 8,000-9,000 crores. - Combined with the existing order book of around INR 6,500 crores, total orders could approach INR 13,000-14,000 crores. - Revenue guidance for the next year (FY27) is estimated at INR 4,500 crores, based on execution of the enlarged order book. - Execution of new orders from the third quarter is expected, although significant revenue contribution may start in the last quarter due to project basements and real estate focus. - EBITDA margins are expected to stabilize in the 8%-9% range starting Q2/Q3 FY26 after overcoming labor shortages. - Precast facility capacity utilization is expected to grow, targeting INR 500 crores revenue in the next 1-1.5 years from precast operations. - The company is scaling management and teams, including a new Mumbai office, to handle growth.

- Order inflow for FY26 is expected between INR 7,500 to 8,000 crores, mainly from Adani Group projects, indicating strong growth potential. - Revenue guidance for next year (FY27) is projected at around INR 4,500 crores, supported by an expanded order book of INR 13,000-14,000 crores. - EBITDA margins expected to stabilize in the range of 8% to 9% starting Q2 or Q3 FY26 as labor shortage issues ease. - Improved working capital position anticipated by Q3 FY26 due to advances received, reducing reliance on bank borrowings. - Precast facility utilization expected to grow from current ~50% to full capacity, targeting revenue of INR 500 crores within 1-1.5 years. - Company is scaling up teams and operations in Mumbai to handle anticipated project inflows and enhance execution capabilities.

- Current capex for FY26 mainly includes plant and machinery, formwork, and cranes for new sites, amounting to around INR 32 crores. - Capex guidance for FY26 and FY27 is expected to be 3% to 4% of turnover. - Capex investment supports large-scale projects from the Adani Group, with possible variation of ±0.5%. - Precast facility capex aims to increase capacity utilization to generate up to INR 500 crores revenue in 1-1.5 years. - Emphasis on technology adoption (e.g., modular formwork, Peri table forms) to improve productivity and reduce labor dependence. - No specific mention of strategic investments or acquisitions beyond enhancements in manufacturing and site equipment.

- There is no specific mention of any current or planned new fundraising through equity in the call. - The company has increased debt by around INR 100 crores in Q1 FY26, mainly due to working capital needs and capex advance payments. - Capex of INR 32 crores was incurred in Q1 FY26 mainly for plant and machinery including formwork and cranes for new sites. - Management expects working capital usage to reduce significantly by end of Q3 FY26, aided by advances from Adani group projects. - Total sanctioned credit facilities stand at INR 1497 crores, with current utilization of INR 864 crores and INR 431 crores available. - Given available credit and advances from orders, company does not foresee major working capital issues. - No explicit plans for additional debt or equity fundraising were disclosed during the call.

- Current order book stands at approximately INR 6,150 to 6,500 crores as of June 30, 2025. - Upcoming order inflows expected from the Adani Group are between INR 7,000 to 7,500 crores for FY '26. - Discussions are ongoing with the Adani Group for potential projects worth INR 8,000 to 9,000 crores. - Order book comprises a mix of projects including core & shell, finishing, turnkey, and MEP works. - Majority of new projects are expected to be item rate contracts rather than fixed-price. - Order inflows outside Adani are limited but bidding occurs for prestigious projects such as the Ambaji Corridor development. - Expected total order pipeline could be around INR 13,000 to 14,000 crores combining current and upcoming inflows. - Execution of new orders mainly expected to begin from Q3 FY '26, with significant revenue impact in FY '27.