Patel Engineering Ltd

Purpose & Scope

• Submit BRSR for FY2025-26 under Regulation 34(2)(f) of LODR.

Governance & Oversight

• BRSR Committee chaired by Whole-Time Director; meets twice yearly.
• Nine NGRBC principles supported; policies approved by the Board.
• Board-approved policies; governance integrates ESG disclosures.

ESG Metrics (Key Highlights)

• CSR turnover 50,665.64 million; net worth 43,880.80 million.
• Board comprises 8 directors; 4 are women (50%).
• Total employees 2,061; workers 11,238.
• Total Scope 1+2 emissions 24,604 tCO2e; intensity 0.4856 per million turnover.

Safety & Workforce Health

• OHS ISO 45001 certified by BSI.
• LTIFR 0.06 (employees), 0.42 (workers); 7 subcontractor fatalities.

Financial highlights

• Consolidated revenue from operations: 51,027.42 INR million; total income 52,685.04 INR million.
• EBITDA: 6,840.33 INR million; margin 13.40%.
• Net profit to owners: 2,944.95 INR million; up 21.6% YoY.
• Diluted EPS: 3.09 INR; standalone EPS: 3.19 INR.
• Order book: 151,193 INR million; Book-to-Bill 2.96x.

Balance sheet & capital structure

• Consolidated debt: 11,869.34 INR million; debt-to-equity 0.27x.
• Rights issue raised ~₹4,000 million; strengthens equity base.
• Debt reduction of ₹4,155 million in FY26; lowest in a decade.
• Credit rating upgraded to A (Stable) post year-end.

Order book & pipeline

• Order book at year-end: ₹151,193 million across 53 projects.
• FY26 order inflows: ₹44,009 million; hydro 47.5% and urban 30% mix.
• Book-to-Bill: 2.96x; 92% order book from Central/State governments.
• Hydropower backlog and PSP opportunities delineate multi-year visibility.

Strategic developments & growth

• MOU for Gongri Hydropower Project (144 MW) on BOOT; 40-year concession.
• Pumped storage growth aligned with 100 GW target by 2035-36; 39 PSPs allocated.
• International expansion: Nepal and Bhutan projects; lower Arun HEP potential awarded.
• Monetization of non-core assets to improve liquidity; asset ownership shifts ongoing.

Governance & leadership

• Ms. Sudha Navandar appointed Independent Director on March 16, 2026.
• Mr. R. V. R. Kishore appointed Whole-Time Director on Sept 22, 2025.
• Six Board meetings held in FY26; varied committee composition.

Risks & regulatory outlook

• Key risks: execution in challenging terrains; tendering lags; regulatory clearances.
• Mitigants: diversified portfolio, robust project controls, and long-term visibility.

CSR & sustainability

• CSR spend: ₹14.98 million; unspent balance ₹0.41 million.
• Focus on education, healthcare, rural development; CSR governance in place.

Audit & governance flags

• Auditors: Vatsaraj & Co.; notes on going concern for some subsidiaries.
• Secretarial audit: minor quorum issue resolved; governance processes maintained.

Financial Performance

• Consolidated Q1 FY27 revenue Rs 1,281 crores, up ~4% YoY.
• Consolidated PAT Rs 93.5 crores; up 24.5% YoY.
• Consolidated EBITDA margin 14.02% vs 13.40% in Q1 FY26.
• Standalone Q1 FY27 revenue Rs 1,274 crores; PAT Rs 82.74 crores.
• Standalone EBITDA margin 13.82% vs 12.97% in Q1 FY26.
• Total debt Rs 1,293 crores; WC debt Rs 969 crores; term debt Rs 324 crores.
• Debt-equity ratio ~0.28; net working capital days 137.
• Receivable days 40-45.
• Order book Rs 14,636 crores as of Jun 30 FY26.
• Hydropower 62%, Irrigation 17%, Tunneling 4%, Roads 17% of mix.
• Bids under evaluation Rs 9,000 crores; near-term pipeline Rs 60,000 crores.
• New orders target Rs 8,000 crores; FY27 revenue growth ~10%; second half stronger.
• Land monetization: Telangana parcel sold; 27 acres, Rs 26 crores.

Operating & Segment Update

• Hydropower revenue share ~68%; Irrigation 15%; Tunneling 13%; Roads & Urban Infra 4%.
• Subansiri Lower HEP: 4 units operational; Unit-7 concreting begun; all eight units this FY.
• Kiru & Kwar HEP: Kwar Dam concreting >50%; draft-tube Unit-1 handed to E&M.
• Parnai HEP: roof-truss installation completed.
• Dorjilung HEP (Bhutan) work commenced.
• Sleemanabad Tunnel (11.95 km): breakthrough; two TBMs; irrigation to ~2.4 lakh hectares.
• Kalai-II HEP (1200 MW) outlay Rs 14,000 crores; Kamla HEP (1720 MW) Rs 26,000 crores.
• Naying HEP environment clearance recommended; Velimalai Pumped Storage 1,100 MW cleared.

Balance Sheet & Cash Flow

• Total debt Rs 1,293 crores; working-capital debt Rs 969 crores; term debt Rs 324 crores; debt-equity 0.28.
• Client advances Rs 615 crores vs Rs 622 crores as of March.
• Net working capital days: 137.
• Promoter pledge: 85-90% of shares pledged; expected reduction 15-20% this year.
• Land monetization: Telangana land parcel sale completed; 27 acres, Rs 26 crores.
• Arbitration monetization: targeting Rs 150-200 crores this year.

Projects & Capex

• Aiming to bid across large Hydro, PSP, Tunneling and Urban Infra packages; outcomes by Diwali.
• Larger project pipeline includes Sawalkote, Kalai-II, Kamla; bidding status is pending.
• Bidding pipeline includes 9,000 crores already bid; ~60,000 crores in pipeline, mainly Arunachal/Northeast.

Outlook & Guidance

• FY27 revenue growth guidance: approximately 10%; second half contribution expected to be significant.

Q&A Highlights

• PAT growth trajectory: current year estimates around 10% with EBITDA 13-14% and stable interest costs.
• Order-book coverage: book-to-bill around 3; execution planned over ~3 years.
• Need for new orders: target ~Rs 8,000 crores this year to support growth.
• Receivable days: 40-45; monsoon Q2 could slow but in line with past.
• Asset monetization: Rs 150-200 crores targeted this year via land/arbitration settlements.
• Promoter pledge update: substantial reduction expected within 6 months; exact % not disclosed.

Audio recording availability

• Audio recording of quarter ended June 30, 2026 investor call is available on the company website.
• MD Kavita Shirvaikar and CFO Rahul Agarwal attended the call; no unpublished price-sensitive information discussed.

Issue Overview

• Rights issue of fully paid-up equity shares; no undersubscription reported.
• Total issue size and net proceeds disclosed; no revision or undersubscription noted.
• Main objectives: debt repayment, general corporate purposes, and issue expenses.

Utilisation of Proceeds

• Utilisation aligned with offer document; no deviations observed.
• Funds earmarked for issue expenses reallocated to General Corporate Purposes.
• Repayment of borrowings fully utilized; completed within the stated timeline.
• General Corporate Purposes utilization: allocation fully utilized as of quarter end.
• Issue expenses utilized; any remaining funds reallocated to GCP.
• Current status: no unutilised funds remaining after reallocation.
• Means of finance unchanged.

Governance and Compliance

• Statutory approvals related to objects deemed not applicable.
• No material events or information affecting viability reported.
• No outstanding deviations or material issues reported.

GCP Details

• GCP usage: funds reallocated to GCP used for subcontractor payments.

Filing context

• Category: Company Update; Subcategory: Monitoring Agency Report.

Deviation status and fund utilisation

• Mode of fund raising: Rights Issue.
• Deviation in use of funds: Nil.
• Monitoring agency: CARE Ratings Limited.
• Audit Committee: No deviation observed.
• Auditors' comments: Not applicable.
• Original objects unchanged; no modifications or deviation.
• Utilisation status: No deviation; usage per plan.

Business Overview

• Patel Engineering is an EPC focusing on hydropower, tunnelling, irrigation, roads, and urban infrastructure.
• Order book stands at INR 146,356 Mn across 53 ongoing projects in 14 states plus Nepal/Bhutan.
• Strong exposure to high-entry-barrier hydropower and tunnelling segments.

Operational Highlights

• Subansiri Lower HPP reaches 1,000 MW with Unit 4 commissioning.
• Kwar HPP dam concrete works exceed 50% completion.
• Arun-III HPP achieves 4 million safe man-hours without LT I.
• Dorjilung HPP in Bhutan commences construction at 1,125 MW.
• Parnai HPP powerhouse roof truss structure completed.
• Awards: EPC World for Sela Tunnel; Assocham Achievers for Tunnel T15.
• Non-core asset monetization: sold 27 acres, unlocking INR 256 Mn in value.

Financial Performance

• Revenue from operations INR 12,807 Mn, +3.8% YoY.
• EBITDA INR 1,796 Mn, margin 14.02% (+62 bps YoY).
• Net profit for owners INR 935 Mn, +24.5% YoY.
• Diluted EPS INR 0.94, +10.6% YoY.
• PAT including associates/JV INR 985 Mn, +21.8% YoY.
• Credit rating upgraded: long-term rating to A in June 2026.

Strategic Priorities & Outlook

• Focus on high-entry-barrier hydropower, tunnelling, and pumped storage.
• Selective expansion into transportation and related infrastructure for diversification.
• Develop technology-driven execution capabilities in tunneling and underground works.
• Maintain disciplined project selection emphasizing scale, complexity, and profitability.
• Strengthen balance sheet and optimize cost of capital.

Governance & Leadership

• Board includes Janky Patel (Chair), Kavita Shirvaikar (MD), Shambhu Singh (Independent Dir).
• CFO Rahul Agarwal; Company Secretary Shobha Shetty; independent directors comprise majority.