Affle 3i Limited — Q2 FY26

Affle 3i Ltd Q2 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=QnbYRKcHil8 Published: 6 months ago

0:00 Good morning ladies and gentlemen. Good day and welcome to FL3I Limited Q2 and H1 FI2026 0:08 8 seconds earning conference call hosted by Ambit Capital. As a reminder, all participant line will be in the listenon mode and 0:16 16 seconds there will be an opportunity for you to ask question after the presentation concludes. Should you need assistance during the conference call, please 0:24 24 seconds signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ashwin Ma from Ambit Capital. 0:34 34 seconds Thank you and over to you sir. Thank you Rani. Good morning everyone. On behalf of Ambit Capital, we welcome you all to 0:43 43 seconds Q2 and H1 FY26 conference call of Apple 3i Limited. I take this opportunity to welcome the management of Apple 3i 0:52 52 seconds Limited represented by Mr. Mr. Anoj Khanna Soham who is the chairperson MD and CEO of the company and Mr. Capil 0:59 59 seconds Bhutani who is the chief financial and operations officer of the company. 1:04 1 minute, 4 seconds Before we begin with the discussion, I would like to remind you that some of the statements made in today's conference call may be forward-looking 1:11 1 minute, 11 seconds in nature and may involve some risks and uncertainties. Kindly refer to slide 25 of the company's earnings presentation 1:18 1 minute, 18 seconds for a detailed disclaimer. I will hand it over uh to Mr. Anoj Kana Swahan for his opening remarks. Thanks and over to you Anj. 1:30 1 minute, 30 seconds Thank you Ash. Good morning everyone and thank you for joining the call today. I trust all of you are keeping in good 1:37 1 minute, 37 seconds health. H1 FY 2026 was a transformational period for us as we continue to progress on our Apple 3i 1:45 1 minute, 45 seconds vision with the goal to deliver 10x decadable growth. We outperformed both H1 as well as H2 of the previous year 1:54 1 minute, 54 seconds and are continuing to build on this momentum in FY 2026. 1:58 1 minute, 58 seconds In Q2 FY26, we exceeded all our performance benchmarks to record our highest ever quarterly revenue, EITA, 2:06 2 minutes, 6 seconds profit after tax and convergence. We delivered revenue of rupees 6,467 million, a growth of 19.1% year-onear. 2:17 2 minutes, 17 seconds Our focused execution on higher productivity and continuous innovations enabled us to achieve a bit of rupees 1,461 2:26 2 minutes, 26 seconds million, a growth of 28.9% year-on-year and 172 basis points to bita margin expansion on a year-on-year basis. 2:36 2 minutes, 36 seconds Notably, it marked our sixth consecutive quarter of sequential margin expansion and it resulted in 33.5% 2:44 2 minutes, 44 seconds year-on-year growth in our profit before tax from operations excluding the other income. 2:50 2 minutes, 50 seconds We achieved highest ever pat of rupees 1,15 million, a growth of 20.1% yearonear. 2:58 2 minutes, 58 seconds In terms of our CPCU business, we continue to operate from a position of strength both strategically and operationally. Our CPCU business drove 3:07 3 minutes, 7 seconds 109 million conversions at a CPC rate of rupees 58 and we earned CPC revenues of rupees 6,319 3:15 3 minutes, 15 seconds million. Beyond the numbers, we are inspired by the way we are achieving this growth powered by innovation, 3:23 3 minutes, 23 seconds intelligence, and measurable impact for our advertisers locally. Over the last few quarters, we have deepened the role of AI across our systems and operations. 3:33 3 minutes, 33 seconds Our investments in intelligent technologies are scaling well with the recent launch and integration of Nikico into our unified consumer platform 3:41 3 minutes, 41 seconds stack. Nikico is our specialized AI agentic capability designed to automate and drive ROIdriven growth advertising for marketers across the iOS ecosystem. 3:53 3 minutes, 53 seconds Together with Optics AI, our Genai powered creative engine, Nikico adds a new dimension to how we advance AI 4:00 4 minutes automation and enhance efficiency of the mobile marketing ecosystem. 4:05 4 minutes, 5 seconds We continue to demonstrate strength across our markets. India and global emerging markets together contributed 4:11 4 minutes, 11 seconds 73.9% to our revenue and grew by 20% yearonear. This growth was broad-based 4:19 4 minutes, 19 seconds across our industry verticals supported by the strong pickup in digital ad spends due to the early festive season 4:26 4 minutes, 26 seconds in India. The market tailwinds remain intact reaffirming our positive outlook for sustained growth momentum. 4:34 4 minutes, 34 seconds Our developed markets also delivered a resilient performance growing 16.8% year-on-year and contributing 26.1% to 4:41 4 minutes, 41 seconds our revenue. The growth was driven by deeper customer engagements and a steady expansion in new account additions reflecting the effectiveness of our 4:50 4 minutes, 50 seconds localized sales execution. While the overall trajectory remained positive, we saw a riskmanaged rollover of budgets 4:57 4 minutes, 57 seconds from Q2 to the festive Q3 from a few customers in the United States. We have a robust engagement pipeline for Q3 and 5:05 5 minutes, 5 seconds we continue to unlock new avenues for expansion to strengthen our position as a privacy compliant, trusted and resultsdriven platform. 5:15 5 minutes, 15 seconds We were granted two new patents in the United States, expanding our IT portfolio to 16 granted patents to date. 5:23 5 minutes, 23 seconds The first patent titled method and system to encode user visibility count leverages probabilistic encoding and 5:30 5 minutes, 30 seconds algorithmic functions to estimate ads exposure frequency thus optimizing computing requirements and improving 5:37 5 minutes, 37 seconds user engagement rates. The second patent titled method and system for hardware and softwarebased user identification 5:45 5 minutes, 45 seconds for ads fraud detection enhances our fraud detection capabilities by analyzing plurality of hardware and 5:53 5 minutes, 53 seconds software level data in real time across connected devices. Together, these patents and our tech innovations continue to enhance our competitive mode 6:02 6 minutes, 2 seconds and our ability to deliver quality user conversions and measurable value for advertisers globally. 6:08 6 minutes, 8 seconds This quarter we have featured three customer approved case studies in our earnings presentation. The first case study highlights our fullfunnel user 6:17 6 minutes, 17 seconds engagement strategy for high lifetime value new and existing user conversions for fintech in India. The second 6:25 6 minutes, 25 seconds highlights our capabilities in scaling the impact of CTV ads with mobile engagements and drive rorowass via 6:32 6 minutes, 32 seconds crosscreen conversions for e-commerce in users. 6:36 6 minutes, 36 seconds The third focuses on a multiplacement strategy with dynamic optimizations that significantly boosts purchases for a 6:44 6 minutes, 44 seconds large omni channel retail brand in Latin America. 6:48 6 minutes, 48 seconds Apple continues to be recognized as a technology thought leader in the industry. Our platform was ranked as the fastest growing and the second highest 6:56 6 minutes, 56 seconds gainer in overall market share ahead of several large global tech companies in Singular's Q3 2025 trend report. We also 7:06 7 minutes, 6 seconds received multiple accolades for our advancements in AIdriven marketing automation and hyper contextual creative intelligence at EPDG plus awards 2025. 7:17 7 minutes, 17 seconds Additionally, we were honored with the most effective use of AI and ML and proximity campaign of the year awards at 7:25 7 minutes, 25 seconds E4MA 2025 along with many other recognitions along leading industry forums. With that 7:32 7 minutes, 32 seconds I now hand over our discussion to our CFO Kapani to discuss the financials. Thank you and over to you. 7:41 7 minutes, 41 seconds Thank you. Wishing everyone a good day and hope all of you are keeping safe and well. We continued our positive growth 7:49 7 minutes, 49 seconds trajectory of the previous quarters as it marked our 10th consecutive quarter of uh sequential topline and a bit 7:57 7 minutes, 57 seconds growth and sixth consecutive quarter of AITA margin expansion. 8:01 8 minutes, 1 second Beginning with the highlights of our key performance metrics on a consolidated basis, we delivered year-on-year growth of 19.1% 8:10 8 minutes, 10 seconds in our revenue from operations, 28.9% growth in our 33.5% growth in PBT from 8:19 8 minutes, 19 seconds operations excluding other income and a 20.1% growth in PAT. This was driven by 8:27 8 minutes, 27 seconds broad-based momentum across industry verticals and markets further supported by earlier onset of the festive season 8:34 8 minutes, 34 seconds in India. We concluded quarter 2 FYI26 at a consolidated revenue of INR 6,467 8:42 8 minutes, 42 seconds billion delivering a sequential growth of 4.2%. 8:46 8 minutes, 46 seconds In H1 FY26, we recorded revenue of 12,675 million and it was a balanced performance across the two quarters. 8:57 8 minutes, 57 seconds On a time basis, India revenue grew by 24.8% year on year and a 10.5% quarteron 9:05 9 minutes, 5 seconds quarter. While on adjusted basis, the growth sto.3% year on year, marked by allocation of budgets in Q2 for the festive season 9:13 9 minutes, 13 seconds this year. We continue to enhance our productivity by scaling our platform operations and strengthening AI 9:22 9 minutes, 22 seconds capabilities. These initiatives combined with sustained revenue growth and significantly strengthen our operating 9:28 9 minutes, 28 seconds fundamental growth. As a result, the AITA for the quarter stood at 1,461 9:35 9 minutes, 35 seconds million an increase of 4.6% sequentially. We achieved an AITA of 9:42 9 minutes, 42 seconds 22.6%. 6% um uh in FY26 our AIDA increased by 9:49 9 minutes, 49 seconds 31.2% year on year as we achieved INR 2,858 9:55 9 minutes, 55 seconds million AITA margins to that 22.6% on OPEC our inventory and data cost at 10:03 10 minutes, 3 seconds 61.2% 50% of the revenue from operation and it's it was broadly in line with our 10:10 10 minutes, 10 seconds past quarterly trends. Employee cost increased by 3.5 7% sequentially which was lower than our topline growth and we 10:19 10 minutes, 19 seconds continue to invest in intelligent automation in that enhancing overall productivity. 10:24 10 minutes, 24 seconds Other expenses to 6.4% of our revenues declining by 7.4 2 million on a 10:30 10 minutes, 30 seconds sequential basis and most of the same on the year-on-year basis. Even with the increase in additional provision for 10:38 10 minutes, 38 seconds trade receipts for real money gaining crimes in India, the normal denobilization in other expenses is attributed to other discretionary and 10:46 10 minutes, 46 seconds miscellaneous expenses categories including that of marketing and business promotion activities. 10:53 10 minutes, 53 seconds We achieved profit before tax of INR 1,353 million reflecting a growth of 11:00 11 minutes 19.2% year one year and a 4.8% quarteron quarter. Our underlying growth for both quarters 11:09 11 minutes, 9 seconds quarter two and quarter one is even stronger. It excluded from other income and evaluated our operating performance. 11:20 11 minutes, 20 seconds Our operate profits after tax for the quarter was INR 1,15 11:27 11 minutes, 27 seconds marking an increase of 21.1% year on year and 3.8% quarter on quarter. Our bad margin improved to 11:35 11 minutes, 35 seconds 16.5% of the total revenue from up from 16.1% in quarter two last year. The PAT 11:44 11 minutes, 44 seconds increased in 21. The PAT increased by 21% in H1 of S526 with a margin expansion of 53 11:52 11 minutes, 52 seconds basis point. We continue to prior prioritize efficient working capital management and as such there were no 11:59 11 minutes, 59 seconds material changes in connection risk for all other verticals accepting R&D vertical in India. Our disciplined 12:06 12 minutes, 6 seconds financial management supported by healthy balance sheet and robust operating cash flows provided a strong funding foundation for capturing 12:14 12 minutes, 14 seconds emerging opportunities and driving sustainable growth through FI36 and beyond. With this I end up presentation, please open the floor for the questions. 12:28 12 minutes, 28 seconds Thank you sir. We'll now begin with the question and answer session. Anyone who wishes to ask a question must press star and one on their touchstone telephone. 12:37 12 minutes, 37 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use headset while asking a question. Ladies 12:45 12 minutes, 45 seconds and gentlemen, we'll wait for a moment while a question assembles. 12:50 12 minutes, 50 seconds Uh so Danish I will go ahead with the with the first questions. This is Ashwin here. Uh Anuj congrats on a steady 12:58 12 minutes, 58 seconds performance. uh despite the fact that we have the we had the RMG issues this quarter we saw almost 25% growth in 13:07 13 minutes, 7 seconds India so wanted to get a sense in terms of what were the impacts of the RNG issue are there any residual impacts 13:15 13 minutes, 15 seconds left and what was the offset in terms of driving uh such a strong growth and secondly uh given that this time around 13:24 13 minutes, 24 seconds Diwali was a little earlier so any early signs in terms of how the festive demand is shaping up. 13:34 13 minutes, 34 seconds Thanks Ashin for the question. Yes, the RMG issue did did impact uh in this quarter but that was offset by uh better 13:42 13 minutes, 42 seconds demand and early demand because of Diwali being early today this time. So therefore in uh we saw a lot of the 13:49 13 minutes, 49 seconds advertisers increasing their campaign budget spends earlier in the month of September. So we saw benefit from that. 13:56 13 minutes, 56 seconds So that neutralized the impact of the RN RMG issue for the last quarter. Uh of course there will be some carry forward 14:03 14 minutes, 3 seconds effect because the RMG issue continues now into this quarter as well. Having said that the fact that the festive 14:10 14 minutes, 10 seconds budgets even a bit earlier. I think we saw a more resilient uh growth performance in line with our expectations for the India market and 14:19 14 minutes, 19 seconds therefore overall uh we had a very steady uh outcome. I think uh the fact that we have already seen some part of the festive budgets in our hands um in 14:28 14 minutes, 28 seconds the previous quarter uh uh in Q2 uh we already have a good sense of where this quarter is going and we we are fairly 14:36 14 minutes, 36 seconds confident that we should have a reasonably good quarter in Q3 uh given the fact that you know we already have in hand all the pipeline of the budgets 14:45 14 minutes, 45 seconds for the festive quarter and we are keeping a clean and very carefully calibrated check on any impact of RMG 14:52 14 minutes, 52 seconds which you know was already known through the last quarter. So we have upped our sales efforts and pipelines in the other verticles. So we should be all right. Uh 15:01 15 minutes, 1 second but yes there is some impact of the RNG issue which uh which is known to all of us. Yeah. 15:06 15 minutes, 6 seconds Uh sure. Uh and just one question on the develop market side. Uh you did talk about some rollover of the budgets from 15:14 15 minutes, 14 seconds Q2 to Q3. Uh so what exactly are we seeing there? any impact of the the tariff or the uncertainty that's been 15:22 15 minutes, 22 seconds there around the uh around the drug tariffs or their policies or demand in the developed market. Uh how are we 15:30 15 minutes, 30 seconds seeing that shape up? So for us we haven't seen any uh you know reduction in budgets due to any tariff issues at 15:39 15 minutes, 39 seconds the moment. What we have though seen is that some of the advertisers were more careful and they were wanting to you know increase their budgets into Q3 15:48 15 minutes, 48 seconds which is a festive quarter versus uh spending more during the previous quarter uh because of the uncertaintity around tariffs. So they wanted to they 15:56 15 minutes, 56 seconds didn't reduce the budgets but they did a what we call typical optimization you know instead of spending it in uh July, August, September they're looking to 16:05 16 minutes, 5 seconds spend a bit more in October, November, December. So our pipeline for developed markets is resilient and strong u and stronger versus the last quarter in Q3. 16:15 16 minutes, 15 seconds So the festive quarter in uh in developed markets should be stronger than uh than than what we have seen in 16:22 16 minutes, 22 seconds Q2. Right? So so we are seeing some of the budgets moving there but that's more uh what we define as riskmanaged um you 16:30 16 minutes, 30 seconds know calibration of some of the marketing uh budgets being planned by the advertising teams of our customers. 16:36 16 minutes, 36 seconds Sure. Uh thanks so much uh moderator. You can take the next question. 16:44 16 minutes, 44 seconds Thank you sir. Our next question come from the line of Deep Sha from BNK securities. Please go ahead sir. 16:51 16 minutes, 51 seconds Hi. Uh thank you. Good morning. Uh so first question actually on the revenue split. U after I think seven quarters 16:59 16 minutes, 59 seconds we've seen non CPCU revenue again at roughly roughly 15 crores. So is this like a one-time project or or some 17:06 17 minutes, 6 seconds client wanted something non CPO because I think directionally we we have been focusing only on the CPCO side. So some clarity here could be useful. Thank you. 17:19 17 minutes, 19 seconds That's correct. So for us uh CPCU is the anchoring uh segment that we're pushing 17:25 17 minutes, 25 seconds for and nonCPCU is anything that is you know outside dri conversionsdriven campaign. So there could be instances 17:34 17 minutes, 34 seconds where we would do certain licensing deals with certain customers. There would be cases where we're doing a branding campaign where the customer is 17:42 17 minutes, 42 seconds not necessarily yet graduated to sharing deeper conversion funnel details. So there could be instances where we 17:50 17 minutes, 50 seconds onboard a customer or an agency or a partner to come onto our platforms using licensing or brand campaigns 17:58 17 minutes, 58 seconds methodologies. Even there you know our goal is very clearly to transform them going forward into CPC business. So you can think of it as a feeding mechanism. 18:07 18 minutes, 7 seconds Some of the customers would come in in a certain form in a nonCPCU format but very quickly you know we are always graduating them upwards doing deeper 18:16 18 minutes, 16 seconds tech integrations with them to get them to the CPCU format because even if it is a branding campaign as you would note in the CTV um case studies that we have 18:25 18 minutes, 25 seconds been sharing with all of you in our presentation even if it is an ad showing on a larger screen CTV we are able to link it back to mobile and drive 18:33 18 minutes, 33 seconds conversions from it. So, so we have the capability today to go to our customers and get branding budgets for them but 18:40 18 minutes, 40 seconds then transform that into a performance CPCU kind of a metrics and in certain instances it would be a scenario that 18:48 18 minutes, 48 seconds you know in certain customers it may take a bit longer and therefore it starts as a non CPCU and then hopefully graduates into a CPCU format as we do 18:56 18 minutes, 56 seconds deeper integrations and make them more comfortable with that. Uh perfect this is this is very useful. 19:03 19 minutes, 3 seconds uh second question it happens. So suppose we've seen now I think again six seven quarters of margin improvements 19:10 19 minutes, 10 seconds and and this time we've seen some improvement despite some provisions that we would have had to take. So two sub 19:18 19 minutes, 18 seconds parts here. First uh if you to quantify if that's material enough if you could quantify the provisioning uh and and 19:25 19 minutes, 25 seconds second what part of it do you think uh is actually the operating leverage because we also saw some cost 19:33 19 minutes, 33 seconds rationalization that you spoke about in in the opening remark. So is all of that sustainable? Is it all off driven? If 19:41 19 minutes, 41 seconds you could give some idea around it, it would be helpful. Thank you. 19:46 19 minutes, 46 seconds So the provisioning effect uh can be quantified as close to about half a percent of our uh profits uh before tax 19:54 19 minutes, 54 seconds right uh which is the provision which has been uh reviewed by the our uh statutory auditors uh based on the 20:02 20 minutes, 2 seconds current assessment it will be uh an ongoing assessment uh in the next quarter also uh with regards to the 20:09 20 minutes, 9 seconds operation efficiencies quarter two uh uh we have been spending on marketing efforts for last four quarters um on a 20:17 20 minutes, 17 seconds on a regular basis and we had taken a certain call on our marketing and uh uh activities for this quarter. efficiency 20:26 20 minutes, 26 seconds there. Uh with regards to other efficiencies, with regards to our number of employees, I think so we have not increased number of employees but yes 20:34 20 minutes, 34 seconds certain employees this quarter have earned their variables. So you will uh you saw an increase but otherwise overall we are not increasing our opex 20:42 20 minutes, 42 seconds and uh the margin at these levels should be sustainable uh for the medium term. 20:49 20 minutes, 49 seconds Perfect. Thanks guys and all the best. 20:55 20 minutes, 55 seconds Thank you sir. Our next question come from the line of Arun Prasad from Evadius Park. Please go ahead. 21:03 21 minutes, 3 seconds Hi uh hi good morning everyone. 21:08 21 minutes, 8 seconds Um uh my first question is on uh uh we discussed this quite often in the past. 21:15 21 minutes, 15 seconds uh I think we have been fairly uh delivering consistent growth of roughly 20% which is aligned with our long-term 21:24 21 minutes, 24 seconds uh projections. Is there any still case for uh going after some of the other businesses which is may not be as 21:32 21 minutes, 32 seconds profitable as you know at the current margins but maybe diluting some margins we can deliver better growth. uh thereby 21:40 21 minutes, 40 seconds obviously the marginal uh uh margins might be lower but overall that will deliver better share better value to the 21:48 21 minutes, 48 seconds shareholders. Is there any case for that for us to go for this? 21:56 21 minutes, 56 seconds Uh hi thanks for your question. Yes. Uh it is um definitely consistent 22:03 22 minutes, 3 seconds uh resilient performance giving 20% approximate growth on a year-on-year basis consistently. Um and it is not 22:11 22 minutes, 11 seconds just a growth in terms of um you know the revenue numbers and I think we've always mentioned that we are a margin 22:18 22 minutes, 18 seconds sensible bottom line uh aggressive company and therefore the DNA of the whole organization. Let's say the 22:26 22 minutes, 26 seconds customer talked about some of the people around the variables. Now even there the the targets for the sales teams the business heads across all markets 22:35 22 minutes, 35 seconds carry two functions revenue growth which is sales as well as margin expansion. 22:40 22 minutes, 40 seconds All right. So the uh the whole organization is run in a certain fashion. Now to to let's say deviate 22:47 22 minutes, 47 seconds from that to incentivize the team to go for slightly lower margin businesses or just get the numbers in would would I 22:56 22 minutes, 56 seconds think would be um an unnecessary step to undertake at this moment. We are seeing sensible amount of uh growth coming from 23:05 23 minutes, 5 seconds the let's say higher profit pools right so positioning ourselves as a premium platform try getting high lifetime value 23:12 23 minutes, 12 seconds users both new as well as existing user conversions for our customers and I think that positioning is a way more 23:19 23 minutes, 19 seconds premium positioning and being able to say no to certain revenues which are of a lower margin or a lower profile I 23:28 23 minutes, 28 seconds think uh or well with our competitive mode. Now are we leaving something behind on the table for let's say other 23:36 23 minutes, 36 seconds competitors to to take up that business and you know challenge us in future? We don't think so. On the contrary when these advertisers graduate to say that 23:45 23 minutes, 45 seconds okay we've got certain base of users now please help us to get to a more premium or more higher value users then they 23:52 23 minutes, 52 seconds would necessarily come to us. So the positioning of our platform and our company as a premium platform for our advertisers is a very important um sort 24:01 24 minutes, 1 second of external message to our customers and profiling of our companies but also internally I think it builds organizational pride and alignment that 24:09 24 minutes, 9 seconds let's not just change revenue growth let's go very clear we have to get revenue growth very aggressively but as long as we are getting this level of 24:17 24 minutes, 17 seconds growth which is about 20% year-on-year growth and we are able to then expand our margins that is the right way to grow and the right way to build the 24:25 24 minutes, 25 seconds company and we don't want to tamper with the organizational DNA at this moment. 24:30 24 minutes, 30 seconds So I think for the near-term we would see our focus would continue to be at this level of growth while doing consistent sensible margin expansion. 24:41 24 minutes, 41 seconds Uh right u uh very very clear and uh thanks for that uh uh great answer. 24:48 24 minutes, 48 seconds Secondly on the uh available cash we spoke about uh in organic or strategic acquisition and and uh you also 24:55 24 minutes, 55 seconds indicated that as and when the time is right and the and the the price is right you will go for it. Um uh do you feel 25:04 25 minutes, 4 seconds that we we still have a lot of opportunity on the table uh uh to utilize this cash and deploy and take 25:12 25 minutes, 12 seconds take our uh business to the next level or uh you feel that currently we are you still want to wait and watch and uh the 25:20 25 minutes, 20 seconds valuation is a bigger concern and uh and hence you'll wait for opportunate time how should we look at uh your inorganic 25:28 25 minutes, 28 seconds growth conditions and thanks for that question. Yes. Uh we have maintained all along that we are um 25:36 25 minutes, 36 seconds a single cash generating you know business unit really focused on the consumer platform business and even our acquisition approach has been largely 25:45 25 minutes, 45 seconds you know expanding that particular business uh business case uh rather than you know hedging or shifting into uh any 25:53 25 minutes, 53 seconds other adjacencies. So we have looked at both horizontal as well as vertical integration within the consumer platform 26:00 26 minutes ecosystem and uh we have a pipeline or let's say uh you know evaluation list of 26:08 26 minutes, 8 seconds around 10 companies that we are actively evaluating uh at the investment committee level and we would necessarily 26:15 26 minutes, 15 seconds look at the right timing yes in the sense of valuation but also I think in terms of where those target companies 26:22 26 minutes, 22 seconds are in their journey you know there there are times when they are in the right mindset to to become part of another company and there are times when 26:30 26 minutes, 30 seconds they are not right. So I think we are assessing all of that um for those 10 companies that are in our active evaluation list and I think uh that 26:40 26 minutes, 40 seconds should tell you that there are sufficient M&A opportunities uh on an immediate basis into the into the midterm future. So we will be very 26:48 26 minutes, 48 seconds selective. we'll be very careful and one could reasonably expect like so we did our last M&A about 2 years ago. So I think it's about time that we would be 26:57 26 minutes, 57 seconds considering actively what what we can pursue with the right valuation and the right kind of DNA match with our company in the next uh coming quarters and we 27:06 27 minutes, 6 seconds would also be evaluating these opportunities on a midterm basis because we see ourselves doing an acquisition maybe one a year or one every two years 27:14 27 minutes, 14 seconds um over a period of time right so I think that's the kind of modus of Randy for our company um and I think you can you can see the track record of how we 27:23 27 minutes, 23 seconds have done M&A's very responsibly with a very clear transformational thesis that we are if we are acquiring something how 27:30 27 minutes, 30 seconds will we transform it to a higher calibration of growth or higher margin profile and I think those are the kind of elements that we are building our own 27:39 27 minutes, 39 seconds conviction around once we convinced that okay do we have the right valuation for a target company and that we can take over uh their operations sensibly then 27:48 27 minutes, 48 seconds we have a very clear time bound thesis on how we will transform that company into a more profitable or more valuable companies than what we will acquire it 27:56 27 minutes, 56 seconds for. So we are building that conviction around a few and we are actively assessing these opportunities. If anything matures and a deal were to happen of course we will do the appropriate disclosures. 28:07 28 minutes, 7 seconds Uh just to be clear you all these 10 names I mean you have in the pipeline which matches our DNA which we like 28:15 28 minutes, 15 seconds probably valuation is uh what we are trying to uh is it the right understanding? 28:22 28 minutes, 22 seconds Um I think the right way to say it is these are all 10 where we think that on the surface primacy early evaluation before going into you know further 28:31 28 minutes, 31 seconds details of who are the people and what's happening internally and what's the strength of their tech and so on just at a very early level of diligence we are 28:40 28 minutes, 40 seconds seeing that yes these uh you know target companies should be um you know how do you say the we call it the courtship 28:48 28 minutes, 48 seconds period okay the courtship period is where you're engaging actively with these candidates and evaluating them for a long period of time. It's not going to 28:55 28 minutes, 55 seconds be the case where we met a company and we'll do a transaction very quickly. 28:59 28 minutes, 59 seconds Right? So, it's a very prolonged process. If you look at our past discourses, any acquisition that we have done, we've always highlighted that we were engaging with all those companies 29:07 29 minutes, 7 seconds for many many years before reaching the term sheet or the conclusion of a transaction. So, this is a long drawn process. It is not a speed dating 29:16 29 minutes, 16 seconds process that okay, you met someone and quickly you know thought let's just do a deal. We try to get to know the companies rather deeply over a long 29:22 29 minutes, 22 seconds prolonged period of time and if we find the right valuation and timing we will do the transaction. So you know it's this is how I would answer it. I 29:30 29 minutes, 30 seconds wouldn't just say that it's pegged on valuation negotiation. It's many many different aspects of evaluation. 29:39 29 minutes, 39 seconds Uh to you and thank you sir. Our next question come 29:46 29 minutes, 46 seconds from the line of Swapnil Pot from JM Financial Service Limited. Please go ahead sir. 29:54 29 minutes, 54 seconds Hi uh thanks for the opportunity. Um I have a couple of questions. Uh the first one is on your uh depreciation and 30:01 30 minutes, 1 second moderation. Uh it seems there was a sharp quarterly increase in your DNA. Uh 30:08 30 minutes, 8 seconds and can you help us understand why such a big increase was there this quarter? 30:13 30 minutes, 13 seconds uh and possibly uh uh uh a related question to that your accounting policy when it comes to capitalization of certain cost related to R&D. So that's the first one. 30:26 30 minutes, 26 seconds Hi uh I'll take this question. Uh we if you see our quarterly uh results every year you would see this trend coming in. 30:34 30 minutes, 34 seconds It's not uh without a trend. It says that uh certain portions of the new effects get capitalized during and put 30:43 30 minutes, 43 seconds to use during this period and there is an incremental uh shift of work in 30:50 30 minutes, 50 seconds progress to the actual capitalization and thus the this worker has a higher uh 30:58 30 minutes, 58 seconds depreciation every year and uh it is in line with the trend. Uh with regards to our amortization policy, we have a 4 31:06 31 minutes, 6 seconds year aotization policy of whatever uh the effect which has been capitalized. 31:14 31 minutes, 14 seconds So whichever is capitalized and we follow the same it is consistent and it is uh the capitalization is done by 31:22 31 minutes, 22 seconds separate teams and identified in and in accordance with the accounting standards. 31:31 31 minutes, 31 seconds Okay. 31:32 31 minutes, 32 seconds Uh and the second question is with respect to here. 31:37 31 minutes, 37 seconds So basically uh the the development efforts uh for developing a newer modules is capitalized. The research 31:44 31 minutes, 44 seconds phase is not capitalized or any technical feasibility efforts are not capitalized. 31:53 31 minutes, 53 seconds Got it. Got it. Good. Uh the second question is with respect to your growth guidance historically we have been talking about 20% plus uh revenue 32:01 32 minutes, 1 second growth. Uh now uh we have been slightly off for the last three quarters on that side. I understand that there are going to be some one-offs here and there and 32:10 32 minutes, 10 seconds so slight bit of number is okay. uh but what I'm trying to understand here is right uh uh historic uh for uh during 32:17 32 minutes, 17 seconds the last three four quarters uh our growth was primarily laid by developed markets uh which not uh which's case 32:25 32 minutes, 25 seconds this quarter it was by India markets possibly because of the festives early festives this time around how confident 32:32 32 minutes, 32 seconds are we uh of delivering 20% growth uh uh you know this year and possibly next 32:39 32 minutes, 39 seconds year as well uh given that uh the mix uh suggests that we are slightly moving towards you know uh high teams uh kind of a growth rate uh gradually. 32:54 32 minutes, 54 seconds So this year has been marked by two bigger events. One is India RMG and the second is the US US 33:02 33 minutes, 2 seconds right so despite that we have navigated very well uh our 19% growth is close to what our estimate is right and we are 33:11 33 minutes, 11 seconds confident that by quarters uh we will be able to deliver the stated uh growth potential which we have been 33:19 33 minutes, 19 seconds consistently maintaining. uh with regards to the the moves on the spending side, the inflation risk in the US 33:27 33 minutes, 27 seconds markets right the budget allocation comes a little tighter based on uncertainties. However, uh there was a 33:35 33 minutes, 35 seconds direct uh impact of R&D being stopped on on a yearly basis and that would take about a quarter month to to recover uh 33:44 33 minutes, 44 seconds that loss of 2 and a half% of our compliance. 33:50 33 minutes, 50 seconds Uh so uh does that mean that we we are still maintaining that 20% guidance for 26? 33:59 33 minutes, 59 seconds Our guidance has not been year to year. medium. 34:04 34 minutes, 4 seconds Oh, got it. Got it. Thanks a lot for that opportunity and all the best. 34:12 34 minutes, 12 seconds Thank you, sir. A nice question come from the line of Rahul Jen from Dollar Capital. Please go ahead. 34:20 34 minutes, 20 seconds Yeah. Hi. Uh thanks for the opportunity. 34:23 34 minutes, 23 seconds Uh I have two question. Uh firstly uh an uh we have seen some large GSP reporting lower CPMs. So are we seeing such trend 34:32 34 minutes, 32 seconds in our and also what are the potential you might see in our inventory data box in media. 34:43 34 minutes, 43 seconds Uh thanks for that question. So uh the way we look at our business is um uh 34:49 34 minutes, 49 seconds that we are we are the um CPC performance-driven valuebased pricing 34:57 34 minutes, 57 seconds business model versus uh let's say the larger BSP that you're talking about is largely perhaps in the business of 35:03 35 minutes, 3 seconds selling CPMs and in some take rate on top of that. So their business is to sell impressions and our business is to 35:12 35 minutes, 12 seconds sell conversions. Our business on the other hand is to buy impressions in the market. I've maintained all along that 35:20 35 minutes, 20 seconds there are there is over there's significantly larger number of consumers on connected devices and the amount of 35:28 35 minutes, 28 seconds time people are spending on connected devices leads to a huge volume of supply of impressions. Consequently, it is not 35:36 35 minutes, 36 seconds a surprise that you know supply is increasing on digital people's time on the devices increasing so much that it 35:43 35 minutes, 43 seconds is outpacing the uh growth in the advertising spend right so one could therefore see that the commodity um or 35:51 35 minutes, 51 seconds the raw material of our industry let's call it like that the impressions will become cheaper but then within those impressions there will be more premium 36:00 36 minutes users there will be more premium devices more premium placements so if you focus a lot more on iOS. If you focus a lot more on higherend touch points for 36:09 36 minutes, 9 seconds higher value consumers, then one would still be willing to pay a more premium CPM to go to that. What we are seeing is 36:16 36 minutes, 16 seconds a consistent improvement in our ability to charge advertisers. If you see our trend of CPC pricing has been increasing 36:24 36 minutes, 24 seconds consistently ever since we've been reporting it as a public company. I don't remember any quarter where our CPC pricing would have seen any kind of a 36:32 36 minutes, 32 seconds dip. So it's a consistent movement upward. So our volume of business is increasing with the advertisers. Our 36:40 36 minutes, 40 seconds unit economics or what we are charging per CPCU is also increasing consistently because we are able to demonstrate to 36:47 36 minutes, 47 seconds our advertisers that in this ecosystem we are delivering higher value users to them, higher value conversions to them and that we are a more premium platform. 36:57 36 minutes, 57 seconds In terms of our own margin profile and margin expansion, of course, there are certain factors to it. One is of course in data and inventory cost what 37:04 37 minutes, 4 seconds efficiencies we can drive with our algorithms. Second is of course in terms of the overall uh scale up opportunities 37:12 37 minutes, 12 seconds where we are seeing that uh margin expansion would necessarily happen right because we are a tech platform company and our opex doesn't increase uh as much 37:21 37 minutes, 21 seconds as of course we grow in the revenues. we don't necessarily have to add more people uh to support a greater volume of 37:28 37 minutes, 28 seconds revenue. So we focus on enhanced AI based productivity, a lot more automation. Our goal is to continue to 37:35 37 minutes, 35 seconds improve our pricing to our customers and give them higher value. In the process, if we pass some of that back onto the 37:42 37 minutes, 42 seconds supply side by going more premium, I think that is helping us increase our competitive mode. Um I hope I've 37:50 37 minutes, 50 seconds answered that question to you. Sure that's pretty helpful. I just for uh I 37:58 37 minutes, 58 seconds think you mentioned that there was some migration and business promotion expense. So uh what was the 38:06 38 minutes, 6 seconds quantum if you could share and what's your annual plan on the same? Thanks. 38:12 38 minutes, 12 seconds So uh you can see about a million dollar plus has been the quantum on the spending this quarter uh on the uh side 38:21 38 minutes, 21 seconds on the I'm not saying the exact number but approximately a million dollar we have uh been discretionary on our 38:32 38 minutes, 32 seconds uh and there can repeat 38:40 38 minutes, 40 seconds SH is asking that for the failure what is the budget that we have for you. 38:47 38 minutes, 47 seconds So the failure is the budget in fact is the time period where you you decide whether which events you are uh going there which events you are sponsoring. 38:56 38 minutes, 56 seconds At the moment we believe that uh we had to take a pause for this quarter and uh putting the best foot forward for the 39:04 39 minutes, 4 seconds next quarter which is a fussive season in the international market. 39:12 39 minutes, 12 seconds Thank you Dr. 39:18 39 minutes, 18 seconds Thank you. Our next question come from the line of Nishita Shanklesa from Sapphire Capital. Please go ahead. 39:25 39 minutes, 25 seconds Yes. Hello. 39:28 39 minutes, 28 seconds Uh [clears throat] good morning. Thank you for taking my question. Uh so uh I'm uh new to new to this company and I'm analyzing the company for the first 39:35 39 minutes, 35 seconds time. I just wanted to uh have a better understanding about the CPCU business model that you have if you can explain it to me. 39:49 39 minutes, 49 seconds Sure. So uh the CPC business model is anchored on if you look at the earnings presentation you'll find certain uh you 39:58 39 minutes, 58 seconds know information points that will help you in uh grasping with that and you'll see that the math of our revenue is 40:05 40 minutes, 5 seconds basically number of conversions in millions times the average cost per converted user. So CPC is cost per 40:13 40 minutes, 13 seconds converted user and you [clears throat] would find that the CPC revenue is that match. So the two drivers are number of conversions and what is the average CPC 40:21 40 minutes, 21 seconds rate you can we can charge to an advertiser. And in terms of number of conversions uh we as a consumer platform 40:29 40 minutes, 29 seconds company are looking at how many users are actually transacting users through their connected devices with the 40:38 40 minutes, 38 seconds advertisers. And in that universe of conversions, you know, there will be new user conversions, existing user conversions, conversions where you show 40:46 40 minutes, 46 seconds an ad to a user either on a CTV and drive a conversion on mobile or you show an ad on a mobile but drive a conversion uh event even in a in a physical offline 40:55 40 minutes, 55 seconds location uh based on proximity campaigns. There could be three types of conversions and those use cases are also defined in uh in one of the earning uh 41:04 41 minutes, 4 seconds presentation slides. If you were to refer to that, it talks about new user conversions, repeat user conversions as well as online to offline conversions. 41:13 41 minutes, 13 seconds So, so what is happening from a broad-based trend line uh Nishita for you to model this is that the number of people who are now online is increasing. 41:23 41 minutes, 23 seconds The number of connected devices is increasing. The average time spent on digital and online is increasing. the 41:31 41 minutes, 31 seconds volume of transactions that the consumers are doing online is increasing. The average price of those transactions is also increasing. 41:39 41 minutes, 39 seconds Consequently, when we go to an advertiser and let's say deliver 109 million conversions in a reporting period like let's say in Q2 this last 41:47 41 minutes, 47 seconds quarter we delivered 109 million conversions. Apple is able to command a average CPC rate of about 58 rupees uh 41:55 41 minutes, 55 seconds per conversion across the board. And our goal is to then tell the advertisers that hey these conversions are actually worth that much in fact worth a lot more 42:03 42 minutes, 3 seconds for the advertiser. So they make a value from that conversion over the lifetime of this user and therefore their willingness to pay us this amount and seeing a good value creation for them. 42:14 42 minutes, 14 seconds So the CPU business model is basically the highest level in terms of where you go to an advertiser and say that hey Mr. 42:23 42 minutes, 23 seconds advertiser you don't have to pay for doing your showing your ads or the clicks on those ads but you only pay us 42:30 42 minutes, 30 seconds once you drive a deeper funnel conversion from this consumer on your own apps or your own stores right so I 42:38 42 minutes, 38 seconds think we are helping the advertiser to see a lot more clarity in terms of return on investment so they're investing an x amount with us we're 42:45 42 minutes, 45 seconds saying hey pay us only when you see a clear conversion that's happening for you and therefore that's when you pay us so in a way Apple is stepping uh uh into 42:54 42 minutes, 54 seconds a business model where instead of cost plus pricing where you know let's say the the question from Rahul was about a 43:02 43 minutes, 2 seconds larger DSP selling at lower CPMs because their business is hey please come onto our platform and buy impressions and pay 43:09 43 minutes, 9 seconds for that right our our approach is different we're going to be advertising saying tell us what is your KPI for conversions we will work on the campaign 43:18 43 minutes, 18 seconds on that basis if we hit your KPI you pay us if we don't hit your KPI you don't pay us. So Apple is taking the risk of 43:25 43 minutes, 25 seconds buying the impressions, running the campaigns, processing all the algorithms and data. If we don't deliver on the KPI, we don't get paid. But if we 43:33 43 minutes, 33 seconds deliver on the KPI, we get paid on CPCO basis which are valuebased pricing versus a cost plus pricing. So Mishita 43:40 43 minutes, 40 seconds in a very short way, I've tried to explain to you and I've given you some references to earnings presentation. 43:46 43 minutes, 46 seconds You can see those and that will help you to tie this up. 43:48 43 minutes, 48 seconds Yes. Yes. I you can get in touch you can get in touch with IR team for a short session right so I just had a follow-up question 43:57 43 minutes, 57 seconds in the existing user repeat conversion in the slide that's like the second way that you can generate the revenue every 44:06 44 minutes, 6 seconds time a user transacts every time you get the CPM or like every time that conversion rate is counted 44:15 44 minutes, 15 seconds uh so so how it works is that A campaign can be run for getting new users which 44:22 44 minutes, 22 seconds is market share expansion for an advertiser and there could also be scenarios where the advertiser has already converted the user through our 44:31 44 minutes, 31 seconds platform for them but the user may not be transacting enough with that advertiser. So let's take an example. 44:37 44 minutes, 37 seconds Let's say you've downloaded an app uh and you've registered and you've done your first purchase on that app, but then you know somewhere along the way 44:44 44 minutes, 44 seconds you're doing many other things and you don't go back to that app as much. So the advertiser knows you as an existing user but is not yet satisfied with the 44:54 44 minutes, 54 seconds frequency or the average value of transaction that you're doing with them. 44:58 44 minutes, 58 seconds So they may come back with a campaign to our platform saying that hey could you could you get some repeat conversions from these existing users that you have 45:07 45 minutes, 7 seconds already got for us and then our company would run the campaign and make sure that we drive some incremental conversions repeat conversions and as we 45:16 45 minutes, 16 seconds drive those conversions we can earn revenue against that. 45:19 45 minutes, 19 seconds So that's how uh you know this approach works. So it goes through the full funnel right from a new user coming into the advertisers ecosystem to driving 45:28 45 minutes, 28 seconds repeat conversions from those users to then going saying that okay let's not drive this conversions online but let's see how we can get a user to also engage 45:37 45 minutes, 37 seconds with the offline uh storefronts of these advertisers because in marketing the most valuable user for an advertiser is 45:44 45 minutes, 44 seconds one that buys from them not just once but many times but also through many touch points. A user who buys from an 45:51 45 minutes, 51 seconds advertiser's own hack is a valuable user. The same user if they also buy the same advertiser's product from a 45:58 45 minutes, 58 seconds marketplace uh like an e-commerce marketplace and that same user also goes into a physical mall and walks into the 46:05 46 minutes, 5 seconds store of that advertiser and buys in the physical engagement. This kind of a user is seen as the most loyal user for the 46:13 46 minutes, 13 seconds advertiser to maximize the lifetime value. So if we get this kind of users for the advertisers, we can command a much higher pricing. 46:21 46 minutes, 21 seconds Okay. Understood. Thank you. Thank you. 46:26 46 minutes, 26 seconds Thank you ma'am. Our next question come from the line of Lokeshwanik from Capital. Please go ahead sir. 46:34 46 minutes, 34 seconds Uh yes. Hi good morning to the uh my question was on eco acquisition and integration. You spoke about it very 46:42 46 minutes, 42 seconds briefly in your remarks. uh where you know the uh little more 46:49 46 minutes, 49 seconds details from perspective of whether it helps us in the back end in terms of optimization of cost 46:57 46 minutes, 57 seconds on the conversion side uh or from the perspective of geography whether it sells better in uh developed markets 47:05 47 minutes, 5 seconds versus emerging markets uh also capability to transition from iOS to you 47:12 47 minutes, 12 seconds know Android is it possible that we do something on Android. 47:16 47 minutes, 16 seconds So a little more details on that since it was sure that was great. So so Nico is uh 47:24 47 minutes, 24 seconds not an acquisition. It's an organically developed uh capability which is our AI agentic capability. Now you would note 47:31 47 minutes, 31 seconds that our company has for many years uh been filing uh and being awarded patents in the areas of AI as well as uh filing 47:41 47 minutes, 41 seconds patents in the areas of agentic AI capabilities in the context of adtech for for many years. Okay. So we are forward ready, we are forward looking 47:49 47 minutes, 49 seconds and you know in terms of our IT strategy, product strategy, I think we are uh clearly covering the ground very well and executing and demonstrating you 47:58 47 minutes, 58 seconds know not just intellectual property but also demonstrating impact of that in the form of products consistently being rolled out whether it was optics AI 48:06 48 minutes, 6 seconds earlier this year or now it is Nikico being rolled out on a fully integrated as part of a unified consumer platform 48:14 48 minutes, 14 seconds stack. Now we have started rolling it out as an ROId driven uh growth u engine 48:20 48 minutes, 20 seconds for iOS ecosystem together with optics AI. It makes perfect sense to do that and it's being rolled out not only in developed markets but also in emerging 48:28 48 minutes, 28 seconds markets and in terms of capability we're talking about how Nikico engages with our customers as an agent AI capability 48:36 48 minutes, 36 seconds and also runs internally uh campaign automation optimization in tandem with how our teams would be doing it and in 48:44 48 minutes, 44 seconds fact working together enhancing the human uh intelligence of our teams to deliver an overall much greater impact than what would have happened in a 48:52 48 minutes, 52 seconds shorter time. Okay. So if we take on a campaign and we optimize for greater ROI or lifetime value users, the algorithms 49:01 49 minutes, 1 second algorithms are moving faster and are delivering much greater ROI impact for the advertisers in a shorter time with 49:09 49 minutes, 9 seconds the productivity of our own workforce getting significantly enhanced. So we can handle let's say hundreds of more 49:16 49 minutes, 16 seconds customers and campaigns and deliver ROI in a uh in a much shorter time because of these capabilities being added and 49:24 49 minutes, 24 seconds these automation layers being added into our platform. So that's uh one and in terms of expanding that to beyond iOS to 49:32 49 minutes, 32 seconds Android and other devices is certainly work in progress and we are we are actively uh pursuing that agenda and we 49:40 49 minutes, 40 seconds may not necessarily call it Nikico but you know there are other several agentic AI capabilities that are already transforming the initiatives we just 49:48 49 minutes, 48 seconds decided to unveil and talk about Nico and optics AI is one example of it right so we've already mentioned that we are 49:56 49 minutes, 56 seconds powering a lot of efforts across the board in our organization to enhance the productivity of what we are doing as well as the higher ROI for the 50:05 50 minutes, 5 seconds advertisers based on what we are doing using intelligent technologies across the board. So one example of that is Nico and of course optics AI. 50:14 50 minutes, 14 seconds Great. My second question manage is um you know just to understand the penetration of these capabilities optics 50:21 50 minutes, 21 seconds and the uh today from a from a rough ball up percentage perspective uh out of you know let's say 100 campaigns for 50:29 50 minutes, 29 seconds example how many would have these uh in how many campaign these would be penetrated that is one and second is uh 50:36 50 minutes, 36 seconds you know you mentioned that uh you know the uh ad budgets of advertisers are not growing as fast as the supply side is 50:45 50 minutes, 45 seconds growing. Uh so again from that perspective is there a feeling uh you know with with with these new 50:52 50 minutes, 52 seconds capabilities at least with the existing customers uh I'm sure you can use this to acquire new new campaigns and new customers that would be you know in 51:01 51 minutes, 1 second terms of increasing wallet share with the existing customers because the ad budgets are increasing significantly. Uh 51:08 51 minutes, 8 seconds is there some headwind you see on that side? Uh I'll take the second question first. 51:15 51 minutes, 15 seconds So this is not a case of headwind. This is a simple uh you know economic problem. Okay. So if the supply is increasing and you're selling raw 51:23 51 minutes, 23 seconds material of that supply, I mean the price would go down. But if the supply is increasing that makes the job of finding conversions within those 51:31 51 minutes, 31 seconds increased base of users even harder right so for example if in India you have let's say billion connected devices now and out of those billion connected 51:40 51 minutes, 40 seconds devices the high value high lifetime value transacting consumers is only 100 million versus those 100 million were already online earlier when there were 51:49 51 minutes, 49 seconds 600 million devices as well. So now the number of devices is increased. So you have to it it is going to take you harder to go and filter out through that 51:58 51 minutes, 58 seconds um uh you know larger ocean of traffic to go in deep down and find those conversions. So essentially what we are 52:05 52 minutes, 5 seconds saying is that for premium conversions the CPCO or conversion business model we have the ability to charge higher because of the simple economics of it. 52:17 52 minutes, 17 seconds Whereas at the same time we have the ability to run our algorithms more efficiently and take supply or for the same amount of money that we spend on 52:25 52 minutes, 25 seconds data and inventory cost we can consume a lot more supply and process that efficiently and deepen our intelligence about the overall market base of 52:33 52 minutes, 33 seconds consumers. So what I was explaining to you was actually uh better tailwinds for our business because supply is getting cheaper and is getting a lot and 52:42 52 minutes, 42 seconds therefore there is a case for an internal bigger tech stack platform like Apple which is processing this larger supply more efficiently to find the 52:51 52 minutes, 51 seconds conversions which is now become a harder problem because you to find those conversions in a larger pool of devices with a lot more supply to be processed 52:59 52 minutes, 59 seconds and dealt with. So if if our tech stack is uh done efficiently and sensibly, we should be able to consume for the same amount of data and inventory cost, a lot 53:08 53 minutes, 8 seconds more supply process, a lot more device intelligence, and be able to charge the advertisers per conversion a slightly higher price for CPCO. So it's not a 53:17 53 minutes, 17 seconds case of a headwind. It's a clear case of tailwinds and support. And it's a simple case of an economic problem where you know the demand is getting harder to 53:26 53 minutes, 26 seconds execute on and the supply is increasing and therefore you have supply available at a price but you know to to to find those conversions you have to do a lot 53:34 53 minutes, 34 seconds more efficient work with the technology because you're processing a lot more data a lot more impressions to deal with that right so I think that's how I would 53:43 53 minutes, 43 seconds like to answer it and in terms of penetration I can say that AI automation not limited to the examples of Nico 53:50 53 minutes, 50 seconds optics CI today hasated 80% of our activities. 53:56 53 minutes, 56 seconds I'm just talking about campaigns. I'm talking about 80% of all activity within the organization. It is being powered, 54:04 54 minutes, 4 seconds enhanced and augmented by intelligent AI is being deployed across the world across all in the organization and 54:12 54 minutes, 12 seconds certainly with respect to the advertising. Thank you. 54:22 54 minutes, 22 seconds Thank you sir. 54:24 54 minutes, 24 seconds Next question comes from the line of prote 54:38 54 minutes, 38 seconds mix between India and emerging markets and developed markets and where do you see more room for structural improvement? Any flavor on that would be really helpful. Right. 54:48 54 minutes, 48 seconds The way we look at India and we reported a standalone basis as well. So you can desire from there. But what what's very 54:55 54 minutes, 55 seconds important is to see that India is our most significant largest important market. It is home ground. This is where 55:03 55 minutes, 3 seconds we are lifted. This is where we have the highest number of employees and this is uh absolutely the anchor market for us 55:10 55 minutes, 10 seconds and doing well in India therefore is a strategic number one priority. In terms of other emerging markets around the 55:18 55 minutes, 18 seconds world, they behave in a very similar fashion like how India is in terms of demographic profile of consumers. Lots 55:25 55 minutes, 25 seconds of consumers in Indonesia or Southeast Asian emerging markets or Latin American markets or even Middle East and Africa markets. You see huge number of users 55:34 55 minutes, 34 seconds and devices but you see a very small percentage of them being high value high lifetime value users for the advertisers 55:42 55 minutes, 42 seconds and therefore the need for a strong tech platform that can efficiently deal with this humongous number of users over 3.8 55:50 55 minutes, 50 seconds 8 billion connected devices is what we reach out to is as reported in our in our earnings presentation. And then 55:58 55 minutes, 58 seconds going through that on a on a recurrent basis very efficiently processing all of that data with you know tens and thousands of servers in the cloud and 56:07 56 minutes, 7 seconds yet delivering um the kind of conversion volumes that we delivering charging appropriately for it with the advertisers and extracting the 22.6% data that you saw in the last quarter. 56:18 56 minutes, 18 seconds This is a phenomenal um uh let's say execution efficiency that is being demonstrated with over 73% being anchored on India and emerging markets. 56:30 56 minutes, 30 seconds Now most of us would understand that emerging markets compared to developed markets have a very different unit economics and the amount of data 56:39 56 minutes, 39 seconds processing that we are doing to process um I think we're doing a lot of heavy lifting in emerging markets and getting 56:46 56 minutes, 46 seconds paid at a very tough unit economic uh sort of calibration of the advertisers and therefore the 73% business being in 56:54 56 minutes, 54 seconds emerging markets is a competitive mode which I think very few companies in the world in adtech and match against. If you look at any other adtech company in 57:03 57 minutes, 3 seconds the world which has either got public listed anywhere in the world or has access to significant private capital in 57:10 57 minutes, 10 seconds their earning four of them would be over 80% calibrated on developed markets and even within those developed markets 90% 57:18 57 minutes, 18 seconds of business that they get is from the gaming vertical whereas when you look at Apple Apple is anchored in India on very 57:26 57 minutes, 26 seconds broad-based verticals of categories EFG then we have taken our mode that we have learned with our technology efficiencies 57:33 57 minutes, 33 seconds in India to expand into all other global emerging markets contributing 73% of our revenue and then we have taken that more 57:41 57 minutes, 41 seconds to developed markets and that's contributing about 26 27% of our revenue on an average on a on on the trend lines 57:49 57 minutes, 49 seconds that you see in the recent quarters but essentially we have honed our tech competencies and comparative mode out of 57:56 57 minutes, 56 seconds India and other emerging markets and now we are demonstrating that execution in in developed markets as well. 58:03 58 minutes, 3 seconds Uh thank you an for the detailed answer that was really helpful. My second question is uh like with 25% of our 58:10 58 minutes, 10 seconds revenue coming uh via agencies and the broader AI disruption of the agency model how should we think about our uh 58:18 58 minutes, 18 seconds direct client and agency mix and uh ultimately the war share output there. 58:24 58 minutes, 24 seconds For us uh working with uh the advertiser or an agency appointed by an advertiser we see it as an advertiser's decision. 58:34 58 minutes, 34 seconds As far as we are concerned we are seeing the agencies as much as our customers as we see the direct advertisers. So for us 58:41 58 minutes, 41 seconds they are being served with um you know highest level of regard and loyalty and so we are not influencing anything with 58:50 58 minutes, 50 seconds respect to whether we go through an agency or direct. Okay. What we see today is that the advertisers who have 58:57 58 minutes, 57 seconds their in-house teams are very happy to work with our platform directly and then there are certain advertisers who have in-house teams but due to global 59:05 59 minutes, 5 seconds mandates or otherwise have decided that they must work through an agency. We respect that decision and we work through those agencies with them. But at 59:14 59 minutes, 14 seconds all points in time our systems are deeply integrated to do the data exchange directly with the advertisers 59:21 59 minutes, 21 seconds and systems. Right? Because when we drive a conversion for an advertiser, we must get the appropriate data confirmations and integrations with them 59:29 59 minutes, 29 seconds directly. So even in the scenario where we are working with the agencies for about 25% of our revenues, we are very 59:37 59 minutes, 37 seconds much in a technology integration contact with the end advertiser as well. So I think we are ready to deal with all 59:44 59 minutes, 44 seconds scenarios of how you know the world will evolve. But I think the agencies will still continue to command at least 25% of this kind. Not I'm not talking about 59:53 59 minutes, 53 seconds 25% of our revenue. I'm saying generally if there's a total ad spend in the market you would see that the agencies will still play a meaningful role for 1:00:01 1 hour, 1 second many years to come. The role is becoming less important. The role is becoming questioned but uh I think they have a role to play for many years to come. 1:00:12 1 hour, 12 seconds Understood. That was really helpful. 1:00:14 1 hour, 14 seconds That's it for my site. Thank you for taking Thank you sir. Our next question come 1:00:21 1 hour, 21 seconds from Mr. Sanjay Lada from Bastian Research. Mr. Sanjay, you may please proceed ahead with the question and 1:00:28 1 hour, 28 seconds we'll be taking only one question in the interest of the time. Thank you so much. 1:00:34 1 hour, 34 seconds Okay. Thank you so much sir for the opportunity and congratulation for the consistent performance quarter on quarter. So wanted to know what is our 1:00:42 1 hour, 42 seconds repeat customer rate as for the advertiser we are the converted users. 1:00:47 1 hour, 47 seconds So my friend is every year or from their advertisement budget we should gain the wallet share. Um if you can highlight or 1:00:54 1 hour, 54 seconds talk about with some example and I know it's happening overnight therefore we see 20% plus kind of growth but if you can quantify in the numbers as well. 1:01:05 1 hour, 1 minute, 5 seconds Thank you. 1:01:08 1 hour, 1 minute, 8 seconds Well thanks for your question Sanjay. uh growth comes from let's say three broad dimensions and that is existing 1:01:15 1 hour, 1 minute, 15 seconds customers spending more new customers coming in and spending with us as well as new customers I mean I'm talking 1:01:22 1 hour, 1 minute, 22 seconds about existing and new customers in our current markets and then there is also a dimension of us uh going into new 1:01:29 1 hour, 1 minute, 29 seconds markets because we are a global platform and a global company and to do business in a new country we don't need to necessarily go and register an entity or 1:01:37 1 hour, 1 minute, 37 seconds hire a team and then get revenues from And there we can we have the capability today to to remotely serve countries 1:01:45 1 hour, 1 minute, 45 seconds where we even present and our platforms would work wonderly. So there are three dimensions of growth. Existing customers spending more, new customers coming in 1:01:54 1 hour, 1 minute, 54 seconds in existing markets, new customers coming in in new markets. And I think um this provides a very broad basis of 1:02:03 1 hour, 2 minutes, 3 seconds growth across verticals. And therefore you would find that in all our discourses we take a lot of pride in 1:02:09 1 hour, 2 minutes, 9 seconds saying that we are a very broadbased growth company and broadbraased across verticals across geographies and I think 1:02:17 1 hour, 2 minutes, 17 seconds that gives us a very rich mix as well as a very very naturally hedged organization. So if suddenly fintech has an issue in some market or education 1:02:26 1 hour, 2 minutes, 26 seconds tech has some issue in some market or gaming has some issue in some market you know the the there are natural balances 1:02:34 1 hour, 2 minutes, 34 seconds to this kind of uh a particular vertical or a particular market related turbulence in our business and therefore we see ourselves as a very broadbased 1:02:43 1 hour, 2 minutes, 43 seconds growth engine which is naturally hedged on turbulence of this nature and and I think that uh is the best way that I can 1:02:51 1 hour, 2 minutes, 51 seconds answer this question might be able to slice it nice for you more and seeing how much of the growth is coming from existing customers in which markets 1:02:58 1 hour, 2 minutes, 58 seconds versus new customers in which markets or new markets. I think uh for competitive reasons our board would want to remain a 1:03:07 1 hour, 3 minutes, 7 seconds bit more broad-based in our discourse but you should be looking at it in the way that the uh our company has shown a 1:03:17 1 hour, 3 minutes, 17 seconds lot of strength in terms of negotiating power with our customers. Okay. As the volume of business is growing we are not 1:03:25 1 hour, 3 minutes, 25 seconds letting that impact our price. Now in most business models if a customer is spending a lot more with you they would say hey I'm spending double with you 1:03:33 1 hour, 3 minutes, 33 seconds this year can you please give me a discount right or can you reduce the pricing we have the leverage because we say hey look we are not going to 1:03:41 1 hour, 3 minutes, 41 seconds compromise on pricing if you don't want to spend double spend less I have many many more customers that are willing to put in the budgets to take conversions 1:03:49 1 hour, 3 minutes, 49 seconds in your vertical so we have the ability to ensure that we are growing without taking any subsidy effect on our pricing 1:03:57 1 hour, 3 minutes, 57 seconds or taking any impact on our margins. So we are expanding margins and growing and I think that's showing a very strong competitive advantage as well as negotiating power in the ecosystem. 1:04:09 1 hour, 4 minutes, 9 seconds Thank you sir. Thank you. 1:04:32 1 hour, 4 minutes, 32 seconds Hello. Do we have the next question then? 1:04:35 1 hour, 4 minutes, 35 seconds Can we give the last question over to you for your uh closing remarks? 1:04:41 1 hour, 4 minutes, 41 seconds Okay. I didn't realize there was a silence for a while. I thought maybe there was a connectivity issue. Well, then thank you very much for all your 1:04:48 1 hour, 4 minutes, 48 seconds questions. They were, you know, very insightful questions and I hope that the responses uh were satisfactory. 1:04:55 1 hour, 4 minutes, 55 seconds uh we continue to be uh aggressive about our growth and about our margin expansion uh in depending of you know 1:05:04 1 hour, 5 minutes, 4 seconds any uh quote unquote fluctuations with respect to an early festive season or an R&D issue in India or any budgets moving 1:05:12 1 hour, 5 minutes, 12 seconds from Q2 to Q3 in the rental markets. I mean these are market realities and we will navigate them as we go along but very broad-based growth very naturally 1:05:21 1 hour, 5 minutes, 21 seconds hedged and long-term growth minded. So with that uh thank you for being here today and we will uh look forward to our next interaction. Thank you. 1:05:32 1 hour, 5 minutes, 32 seconds Thank you sir. On behalf of 3 minutes that concludes this conference. Thank you for joining us and you may have disconnect your links.