Genus Power – Smart Metering

Q2’FY24 conference call notes summary –

Orderbook Position

• Current order book ~19,500 Cr; Out of that ~70% is available to Genus. Execution period – 27 months; The order book can be further broken into – Production, Installation and Maintenance (6-7 yrs.)

Revenue Guidance

• 1,200 Cr. confident guidance for FY24, Aasam and Bihar orders to contribute for FY24 revenue;
• For H1, it has been Rs. 520 Cr. Remaining revenue 680 Cr. is expected in H2’24. That will be more than 50% growth in revenue against H2’23.
• Revenue for FY25 & FY26 will be multi-fold

Margins

• Current subdued margins are due to increased expenses for preparation of delivering the huge order book e.g. employee cost, finance cost etc.
• Once the revenue from newer order comes in the management expect to 15-16% margins

Future Outlook

• Ability to take orderbook to about 30,000 Cr. That was a target for 3 yrs. orderbook. 2/3rd of that already achieved.
• Current capacity 10 Million orders. Can increase capacity if the orderbook continue to scale up

I have initiated a position during last week considering the tailwinds for the smart meter adoption. The thing that I am particularly cautious about is – these orders largely being from state electricity utilities, shall we be aware of some challenges about the receivables. Has company management ever clarified about their strategy about saving themselves from receivable related challenges from state electricity boards.