Desco Infratech Ltd

- No immediate plans for equity raise; the company is not commenting on equity raising currently. - Planned capex, including capacity enhancement in Gujarat (12 ton/day) and Madhya Pradesh (4-5 ton/day), will be funded through bank loans (debt). - Current debt rate is high (16%-17%), but after debt restructuring, the cost is expected to come down to around 8.5% to 9.5%. - Debt-to-equity ratio is currently low at 0.2 and may increase to a maximum of 0.3 in the next 1.5 years due to structured debt for growth. - The company intends to repay high-cost NBFC loans via internal accruals and refinancing at lower rates. - Overall approach to debt is prudent: using financing instruments as efficiency tools, not for aggressive leveraging.

- The company is commissioning a 2 ton per day Compressed Biogas (CBG) plant in Q1 FY27 with a capex of approximately INR 3.5 to 4 crores. - Plans to expand CBG capacity to 15 to 20 tons per day over the next 18 months, with total capex around INR 25 crores (INR 12-15 crores in South Gujarat and around INR 9 crores in Madhya Pradesh Dhar). - Aim to enhance Gujarat's CBG capacity to 12 tons per day and start 4-5 tons per day capacity in Madhya Pradesh. - No immediate equity raising planned; funding to be raised primarily through bank loans with structured debt at an interest rate of around 8.5% to 9.5%. - Strategic investment includes acquiring approximately 75% stake in Shri Green Agro Energies Private Limited (SGAEPL) for permissions and eventual merger with Desco Biogreen Private Limited post commissioning of 5 ton per day capacity. - MOU signed for green hydrogen projects, currently in premature stages, anticipating future growth aligned with solar park developments.

- Desco Infratech aims to achieve INR 1,000 crores revenue by FY 2030, potentially a year earlier. - Expected revenue growth of 70% to 80% year-on-year for the next 2 to 3 years. - CGD (City Gas Distribution) segment to contribute 60% to 65% of the revenue going forward. - Power distribution and solar EPC sectors expected to contribute 30% to 35%. - Compressed Biogas (CBG) segment expected to generate revenue of around INR 170 crores by FY 2030. - CBG plants with capacities expanding from 2 TPD in Q1 FY 2026 to 15 to 20 TPD within 18 months. - Plans for commissioning 5 TPD CBG capacity soon with Letter of Award (LOA) already for 5 TPD capacity. - Green hydrogen project at a nascent stage, expected to become profitable in next half-decade. - Company foresees sustained margin and positive operating cash flow within next 1-2 years due to better working capital management.

- The company expects a year-on-year revenue growth of 70% to 80% for the next 2 to 3 years. - Earnings Before Interest and Tax (EBIT) showed a 76.30% growth year-on-year, indicating improving profitability. - Profit After Tax (PAT) grew by 80.87% year-on-year, with a sustainable PAT margin around 22-23%. - EPS increased by 33%, now at 21.34, reflecting significant earnings growth. - The CBG segment is expected to break even within 18 to 20 months of commissioning. - By FY2030, revenue is targeted to reach INR 1,000 crores, with approximately 60-65% from CGD and around INR 170 crores from compressed biogas. - Operating cash flow is expected to turn positive within the next 1-2 years due to improving working capital management and scalable growth. - The company focuses on margin optimization and sustainable growth, avoiding low-margin projects to maintain profitability.

- Current order book stands at approximately INR 345 crores. - Out of this, around INR 330-332 crores pertain to the city gas distribution (CGD) sector. - CGD orders include EPC projects with timelines of 18-24 months and operation & maintenance orders lasting around 24 months (INR 35-40 crores). - Remaining orders relate to power distribution projects with an average execution timeline of 1 year. - A pipeline of tenders worth about INR 650 crores is expected: - INR 470-480 crores from the CGD sector. - Approximately INR 100 crores from solar EPC solutions and power distribution sectors. - Tender openings have been delayed due to the Middle East crisis but expected soon, which will boost the order book.