Rajesh Power Services Ltd Q1 FY27 Earnings Analysis

- Rajesh Power Services Ltd. targets a revenue growth CAGR of around 40% for the next 2 to 3 years. - For FY’27 specifically, the company is looking at 40% growth. - Order inflow targets are approximately INR 4,000 to INR 5,000 crores for the current financial year. - Execution timelines for projects are typically 18 to 24 months, with phased mobilizations already underway. - Expansion in non-Gujarat states is expected to raise the contribution from outside Gujarat closer to 20% of the order book. - The company foresees executing projects worth INR 4,500 crore in the near term, with a robust pipeline including bids worth around INR 2,200 crore pending results. - Growth is expected from both transmission and distribution segments, as well as new areas like BESS (Battery Energy Storage Systems). - Management does not currently plan to revise growth guidance upward despite an increased total addressable market.

- Rajesh Power Services Ltd. projects a **40% CAGR revenue growth** over the next 2 to 3 years (Page 16, 33). - EBITDA margins are expected to remain **stable around 11%-12%**, with PAT margins around **8%-9%** (Pages 15, 16, 36). - The company targets a **consolidated order inflow of INR 4,000 to 5,000 crores annually** in the near term, supporting growth outlook (Pages 16, 34). - Expansion into the **BESS EPC segment** is seen as a new growth engine, expected to contribute a meaningful portion of revenues in 2-3 years, though exact contribution percentages are yet to be finalized (Pages 13, 21). - Management remains confident on **executable project timelines** of 18-24 months, supporting steady revenue recognition (Page 13). - EPS is aligned with rising PAT growth; PAT grew 48% in FY26 and is expected to increase with scaling operations and steady margins (Page 7, 36).

- The company is developing a 65 MW Battery Energy Storage System (BESS) project, which they will own and operate under a build-operate model, expected to commission by September–October 2027. - For the BESS project, they plan to finance 70% to 80% through bank financing with the balance through company equity; exact equity amount is yet to be determined. - CapEx for BESS infrastructure is estimated broadly at INR 1.5 to 2.5 crores per megawatt. - The BESS project is strategic to understand the ecosystem and strengthen bidding capabilities for future BESS EPC projects. - The company is expanding capabilities beyond 220 kV into the 400 kV GIS segment, with a project expected to commission around September–October 2026. - No specific new capex amounts were disclosed beyond these projects; procurement is managed through bulk buying with strong vendor relationships.

- Management mentioned they are working with lenders to secure financing for projects, targeting 70% to 80% debt financing by banks and the rest equity by the company (Page 19). - The exact equity amount is still being determined as the project size is not finalized yet (Page 19). - No specific details were shared about immediate or new fundraising plans through debt or equity. - Short-term borrowings have increased from INR 29 crore to INR 82 crore but were discussed in context of working capital management rather than fresh fundraising (Page 26). - Overall, current fundraising efforts seem focused on project financing with a bank-equity mix, but no new large-scale debt or equity fundraises were explicitly announced during the call.

- As of the latest update, the current order book is approximately INR 3,326 crores. - Gujarat accounts for around 85% to 90% of the current order book. - The company is targeting to close the FY27 order book above INR 5,000 crores. - For FY26, order inflow was around INR 2,743 crores (excluding GST), with an expected additional order inflow of INR 4,000 to INR 5,000 crores by year-end. - The order book includes confirmed orders and around INR 210 crores in L1 tender status. - There are pending bids of INR 2,200 crores with results awaited by May-June. - The addressable opportunity size from GETCO alone is INR 5,000 crores. - The company expects growth opportunities beyond Gujarat, aiming to shift from 85-90% Gujarat share towards approximately 80% Gujarat and 20% outside in the near term.