W S Industries (India) Ltd

- Revenue doubled in the recent quarter (Rs. 25 crore to Rs. 50 crore), although initial infrastructure support costs caused a minor negative EBITDA expected to normalize in coming quarters. - The company aims for Rs. 1000-1200 crore turnover in EPC over the next 3 years with profits of Rs. 50-60 crore from EPC, supplemented by annuity income. - PAT margins of 7-8% are seen as a bare minimum sustainable target; 8-10% is possible but 10% is considered high. - Logistics income expected to start in 2 years, adding steady annuity income from rental yields with high occupancy from MNC partnerships. - Dividend payout expected to commence from 2025, targeting 30-40% of profits as dividend once annuity streams stabilize. - No immediate plans for inorganic growth; focus remains on executing logistics park, IT park, and infrastructure projects to drive earnings growth. - Company currently well-capitalized with no debt, enabling smooth working capital management and project execution.

- Current order book is approximately Rs. 280-284 crores. - Major ongoing orders include: - Trichy bus stand project (Rs. 200 crore), expected completion by September 2024. - Stormwater drain construction order, expected closure by May 2024. - Macro drain project in Pallavaram and Thoraipakkam radial roadside, expected closure by March 2024. - The company is exploring and in advanced stages of signing Rs. 400-500 crore new infrastructure orders expected to be announced in the next quarter. - The Rs. 400 crore order being explored is purely infrastructure-related. - Maximum single order received till date is Rs. 200 crores. - Orders primarily include civil construction, roads, pipelines, stormwater drain, and public buildings. - The company is focusing on executing these orders optimally over the next 12-18 months.

- Currently, there is no immediate plan for raising funds through equity or debt. - The company is well-capitalized with no existing debt and sufficient capital reserves. - Promoters are infusing warrant money as and when working capital requirements arise, reducing the need for borrowing. - The company aims to maintain a low debt-to-equity ratio (~0.25 to 0.5) to manage future funding needs. - For developing new lands or projects, they may consider partnering with MNC clients who bring their own capital. - There is a possibility of future equity partnering when leasing to foreign funds or large clients, where land may become equity. - The company is also exploring an asset-light model, involving partnerships like Canadian Pension Fund or REITs for funding construction through revenue-sharing arrangements. - Potential future REIT structuring is being considered but is at an early stage.

- Initial infrastructure setup for projects (e.g., Trichy project) involves upfront costs, written off within first two quarters; no further infrastructure spend once project is fully ongoing. - The company recently acquired 254 acres in Kancheepuram (Rs. 107 crore), with 150 acres pre-approved for light engineering and warehousing; plans include logistics park and light engineering facilities. - Capital investment for development of Kancheepuram land is flexible—can be asset-light via partnerships with international investors who fund construction in exchange for revenue share or asset-heavy if long-term tenants like Samsung sign up. - No immediate fund raising planned; working capital is currently managed through promoter infusion via warrants. - Future capex depends on signing up multinational clients for rental projects; potential increase in equity might happen if foreign partners join. - Expected completion timelines for some projects (e.g., Porur property JV) are 36 to 48 months, with strategic partners doing the construction.

- FY24 revenue from infra and construction segment expected around Rs. 200 to Rs. 300 crores. - FY25 revenue visibility expected to be slightly higher, projecting approximately Rs. 300 crores per year based on current Rs. 600 crore order book. - Next quarter exploring possibility of additional Rs. 400 crore new orders in infra segment. - Order book positioned for steady execution: Rs. 280 crore current order book with expected timelines for delivery. - Logistics income expected to start in 2 years, creating steady annuity revenue. - Rental income expected as stable monthly cash flow once logistics and IT parks become operational. - Company aims to sign 3-4 MNC clients for lease rentals, focusing on asset-light annuity business. - Future growth includes combining rental and EPC business revenues, with revenue mix evolving dynamically.