Techno Electric & Engineering : Annual Report 2021-22

Sustainable Vision. Responsible Execution.

Techno Electric & Engineering Company Limited Annual Report 2021- 22

Contents

CORPORATE OVERVIEW

At a Glance	2
Operating Model	4
Investment Case	6
Chairman and Managing
Director's Perspective	8
Financial Highlights	11
Business Segment Review	12
Corporate Social Responsibility	20
People Practices	22
Governance	23
Awards and Accolades	26
Key Customer Accounts	27
STATUTORY REPORTS
Management Discussion and Analysis	28
Directors' Report	36
Report on Corporate Governance	54
Business Responsibility Report	72
FINANCIAL STATEMENTS
Standalone Financial Statements	80
Consolidated Financial Statements	159

FY 2021-22 Highlights

Sustainable Vision. Responsible Execution.

Through our years in the power infrastructure industry, the global energy landscape has evolved considerably, and we have been at par with the pace of transformation. There has been a conscious shift to sustainable energy systems globally, and as a torchbearer of the industry in India, we aspire to drive the nation to its goal of sustainable energy adoption with focus on accelerating business growth.

In this pursuit, we have turned our focus to the installation of Flue Gas Desulphurisation (FGD) plants for coal-based thermal power plants to support India's mission to limit sulphur emissions. We are also developing Advanced Metering Infrastructures (AMI) to track energy usage information, helping the nation manage its electricity consumption. We also have made strategic investments in developing data centre infrastructures and energy storage systems on the back of the industry's significant growth potential.

We have a competitive advantage in the power infrastructure space due to our strong bidding discipline, extensive experience and knowledge, prudent working capital management, and cost-effective execution. These strengths indicate that we are well-positioned to capitalise on the emerging opportunities to deliver steady and profitable growth, and create long-term value for our stakeholders.

₹10,739 Mn	₹2,222 Mn	₹2,639 Mn	₹23.99
Revenue from operations	EBITDA	PAT	EPS
21% y-o-y growth	3% y-o-y growth	45% y-o-y growth	45% y-o-y growth

Techno Electric & Engineering Company Limited

At a Glance

Energising

India

All through our four-decade journey, we have been developing India's power infrastructure through our Engineering, Procurement, and Construction (EPC) services, Operations

and Maintenance (O&M) services and asset ownership model. Our Company operates across three broad power-related industries including generation, transmission, and distribution.

We help shape the future of India's power sector by providing EPC services to core industries in India and abroad, engaging in Public-Private Partnerships (PPP)

to build transmission networks, and expanding our portfolio in green energy. Our Company is now established in the anti-emission industry and forayed into development of data centres.

2 Annual Report 2021-22

Key Facts

40+ years

of rich experience in the power sector EPC

425+ projects

completed since inception

25+ years

of average experience of core engineering team

350 professionals

in our team from engineering and other specialisations

Corporate Overview	Statutory Reports	Financial Statements

Business Segments

EPC Services	Public Private Partnership Projects
•	Flue Gas Desulfurisation (FGD) plants	• Transmission linkages through Build
•	Transmission and distribution	Own Operate and Transfer (BOOT)

• Advanced Metering Infrastructure (AMI) or Smart Metering
• Balance of Plant
• Captive waste heat recovery and up to 200 MW of conventional power plant on turnkey basis
• Solutions for power-intensive industries
• Data Centre Solutions

Read more on Page 12

Read more on Page 15

Green Power	Data Centre
129.9 MW wind energy generation	• Develop ultra-scalablehyper-density data
			centres of 250 MW by FY30 across India
Read more on Page 17			Read more on Page 18

3

Techno Electric & Engineering Company Limited

Operating Model

Creating Sustainable Value for Stakeholders

Corporate Overview	Statutory Reports	Financial Statements

Our dependable and customised

Relationships We Depend On

Sound Fundamentals Solid Execution Sustainable Value

solutions, along with financial discipline, a strong execution track record, and extensive experience, have helped us create long-term value for our stakeholders.

We primarily serve Central Public Sector Undertakings (CPSUs) and state government utilities, but also serve private sector customers for captive power plants and power distribution systems in power- intensive industries.

SHAREHOLDERS

Our shareholders own shares of our Company and expect a return on their investment.

GOVERNMENT AND

REGULATORS

Governments and regulators play a central role in shaping the energy sector.

EMPLOYEES

We rely on our people's collective talent, skill, and values to execute our strategy and achieve our goals.

CUSTOMERS

We strive to meet customer expectations by providing quality services in power generation, transmission and distribution.

SUPPLIERS AND

CONTRACTORS

We rely on our robust vendor ecosystem to deliver projects and ensure our success.

• Strategic bidding discipline
• Strong pan-India presence with experience across regions, markets and customers
• Global alliances with technology leaders
• Prudent project management approach
• Seamless, cost- efficient and time- sensitive delivery
• Commitment to compliance

• Completing around
  400 pan-India projects as a turnkey solutions provider, an independent transmission asset owner and an autonomous wind power producer
• Retaining key customer accounts and sharpening bottom-line focus
• Delivering on projects in difficult terrains
• Maintaining a zero- penalty record

• Comprehensive range of niche skills spanning construction, project, procurement, quality assurance, business development, marketing and financial management
• Unmatched levels of quality commitment, environmental management and employee health and safety
• Low balance sheet risk with steadfast profitability levels
• Diversified reach that reinforces our skills and capabilities
• Contribution to the economy by way of payments to the exchequer
• Creation of indirect and direct employment opportunities
• Alignment with India's transition to a low-carbon energy system
• Support to MSME

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Techno Electric & Engineering Company Limited

Investment Case

Differentiated Value

Proposition

TEECL is a profitable company with a strong financial profile. Our Company's intent on long-term business growth, efficient execution, and sustained shareholder returns makes it an appealing investment opportunity.

Corporate Overview	Statutory Reports	Financial Statements

Established Market

Position

We have been in the EPC business for about four decades now and have an established track record in setting up extra high-voltage substations in India. With our high technical capabilities, TEECL has a strong market position having executed 765 kilovolt (KV) extra high-voltage (EHV) substation projects.

Significant Business Growth and Profitability

Our consistent focus on growth is based on our strong fundamentals and it has enabled us to grow our revenue and order book year after year, while maintaining healthy profits.

Revenue from operations

(₹ in Million)

High Operating Efficiency

Our robust technical capabilities, prudent bidding strategy of high-margin orders, and consistent timely delivery of projects have resulted in us achieving industry-leading operating efficiency in our EPC segment which contributes more than 90% of total revenue.

Strong Balance Sheet

We strive to maintain a healthy capital structure that reflects prudent use of debt and equity, while balancing our growth and assets. Since we have a healthy debt profile with a small working capital debt and no long-term debt, we are equipped to capitalise on emerging opportunities without stretching our balance sheet.

FY 2021-22		10, 739
		8,892
FY 2020-21
		8,762
FY 2019-20

PAT

(₹ in Million)

FY 2021-22		2,639
		1,818
FY 2020-21
		1,802
FY 2019-20

ROCE of EPC

(%)

FY 2021-22	63%
FY 2020-21		68%
FY 2019-20		67%

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