Detailed Narrative
Record Order Book Provides Strong Visibility
Engineers India has reached a historic milestone with an order book of ₹11,155 crores as of September 2024, which further grew to approximately ₹12,000 crores following a strong October performance. The H1 FY25 order inflow of ₹5,137 crores already exceeds the ₹3,400 crores achieved in the same period last year. Management expects total inflows for FY25 to reach between ₹8,000 and ₹8,500 crores, driven by a robust pipeline in domestic petrochemicals and international markets.
Revenue Trajectory and FY27 Ambitions
Despite a slow start in the Turnkey segment where revenue fell due to project completions, management is maintaining its FY25 revenue guidance of ₹3,500 crores. They expect execution to accelerate in the second half as new OBE and LSTK projects move into active phases. Looking further ahead, the company has set an ambitious target to reach an annual turnover of ₹5,000 crores by FY27, representing a significant scale-up from current levels.
Segmental Margins and Profitability Drivers
The Consultancy segment continues to be the bedrock of profitability, maintaining margins between 20% and 25%. Turnkey margins are expected to stay around 5%, which is standard for the industry. Overall EBITDA margins for the full year are projected to remain stable at approximately 8.8%, consistent with FY24. Management noted that operational efficiencies and the execution of 'mega jobs' will be key to maintaining these margins as the order book scales.
International Expansion and Abu Dhabi Success
The company's international strategy is yielding results, particularly in the Middle East. The Abu Dhabi office achieved its highest-ever order booking this year, reaching ₹160-180 crores. While projects in Nigeria and Algeria are progressing through bidding and study phases, the Middle East remains the primary driver of international growth. In Guyana, EIL is serving as a project management consultant for a 400 MW power plant and natural gas liquid project, with potential for future refinery and fertilizer assignments.
Strategic Pivot to Green Energy and Nuclear
EIL is actively positioning itself for the energy transition, with a focus on biofuels, green hydrogen, and coal gasification. A notable recent achievement is a ₹300 crore biofuel refinery project. In the nuclear sector, the company is engaging with NTPC and NPCIL, though its role is currently limited to 'balance of plant' infrastructure rather than core reactor technology. Management is also eyeing opportunities in offshore wind energy, leveraging its extensive experience in designing offshore platforms for ONGC.