Dev Accelerator Limited — Q3 FY26

Dev Accelerator Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=2AjsAYEjlqo Published: 3 months ago

0:00 Ladies and gentlemen, good day and welcome to the Dave Accelerator Limited Q3 and 9 months FI26 earnings conference 0:08 8 seconds call. I have with me Mr. Padsha, chairman and wholetime director, Mr. 0:14 14 seconds Umsh Utam Chinani, managing director, Mr. Roushit Sha, whole time director, Mr. Parin Sha, Joint Chief Financial 0:23 23 seconds Officer, Mr. Paranchil, Joint Chief Financial Officer, Mr. Anjenti, company secretary and compliance officer. Mr. 0:33 33 seconds Yasha, non-executive, non-independent director. 0:38 38 seconds Before we proceed, I would like to bring to your attention that certain statements made during this discussion may constitute forwardlooking statements. 0:46 46 seconds These statements are based on current expectation, assumption and beliefs regarding future development and are inherently subject to various risk, 0:55 55 seconds uncertaintities and factors beyond our control. Such forward-looking statements involve both known and unknown risk and 1:02 1 minute, 2 seconds we advise you to interpret with them with caution. 1:07 1 minute, 7 seconds As a reminder, all participant lines will be in the listen mode and there will be an opportunity for you to ask questions after the presentation concludes. 1:16 1 minute, 16 seconds Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. I now hand the 1:25 1 minute, 25 seconds conference over to Mr. Omeshamani, managing director for his opening remarks. 1:35 1 minute, 35 seconds Thank you moderator. Good afternoon everyone and a warm welcome to Dave Accelerator Limited's earnings conference call for the quarter and 9 months ended December 31, 2025. 1:47 1 minute, 47 seconds I trust all of you had an opportunity to review the results that we have shared on our website and also on the stock exchanges and along with it we have also 1:56 1 minute, 56 seconds shared investor presentation and the media releases. 2:00 2 minutes I'll start by sharing a quick brief as to what we do as an organization. 2:06 2 minutes, 6 seconds So Dave Accelerator Limited which we brand as Davex is an enterprise focused 2:13 2 minutes, 13 seconds full solution managed workspace platform. What we essentially do is design, build and provide customuilt 2:22 2 minutes, 22 seconds offices which covers end to end site selection, bespoke fitouts, technology 2:28 2 minutes, 28 seconds integration, payroll management and facility management all under a single service level agreement. So technically 2:36 2 minutes, 36 seconds a client gives or issues a single check to us for seeking all the services which I mentioned above. So we started this 2:44 2 minutes, 44 seconds company back in 2017 with a clear conviction that India's tier 2 cities would become the frontier for future commercial real estate consumption. 2:56 2 minutes, 56 seconds Back then when we were starting not only uh in the country but even in Ahmedabad the city where we started from the 3:03 3 minutes, 3 seconds closest competition that we had was a 50seater service provider and we started with 700 seats being offered to the city 3:12 3 minutes, 12 seconds and that's when the belief became stronger instead of Bangalore Mumbai and Delhi we started to build our foundation 3:19 3 minutes, 19 seconds in Ahmedabad Boda Jaipur Rajcot Udapur and few other emerging cities. which we 3:26 3 minutes, 26 seconds believe would pave the way for next growth of the country. 3:31 3 minutes, 31 seconds 7 years later, the budget which has been announced yesterday showcase the condition that the next growth occurs 3:38 3 minutes, 38 seconds coming from the tier 2 cities and this transition is not just by numbers. It is a structural reform that happening in the country as well as in the industry. 3:50 3 minutes, 50 seconds Today, Dex operates 28 centers across 12 cities, managing almost 9 lakh square of 3:58 3 minutes, 58 seconds area with 13 and a half,000 seats operating at an 88%age occupancy levels 4:06 4 minutes, 6 seconds which is being consumed by more than 300 clients and astonishingly which is not 4:13 4 minutes, 13 seconds the truth of the industry 95%age of our seeds or inventory is sourced directly. 4:21 4 minutes, 21 seconds What makes us fundamentally different from other flex operators is our core focus on tier 2 strategy. 75%age of our revenue today comes from tier 2 cities. 4:32 4 minutes, 32 seconds Just to define few of the tier 2 cities is cities like Ahmedabad, Boda, Jaipur, 4:40 4 minutes, 40 seconds Gandhiagar, Surat, Indor, Rajcot and Udapur. 4:46 4 minutes, 46 seconds The remaining 25% of our revenue comes from tier one cities like Pune, Hyderabad, Noida and Mumbai wherein we 4:55 4 minutes, 55 seconds expand categorically with a backto-back demand coming in from clients. And this shift or focus uh in tier 2 cities is 5:03 5 minutes, 3 seconds not merely by accident. It is a deliberate strategy to focus on these growth corridors. We understand these 5:10 5 minutes, 10 seconds tests extremely deeply and the L is non-institutional in nature very difficult to deal with is where we 5:20 5 minutes, 20 seconds understand the pulse we also understand the talent pools here because that is the critical aspect for our clients the 5:27 5 minutes, 27 seconds enterprise demand patterns bases the growth of office spaces which are being built bases the availability of talent 5:34 5 minutes, 34 seconds pool and all of these supported with regulatory environment is where we understand in and out of it and this 5:42 5 minutes, 42 seconds ultimately results into superior unit economics because our renttore revenue ratio in tier 2 cities stands at 2.62x while in tier 1 cities it is 2.1x. 5:55 5 minutes, 55 seconds This showcases that our strategy is impacting on ground and is not just a mere love towards tier 2 cities but it 6:04 6 minutes, 4 seconds translates into positive numbers as well. 6:07 6 minutes, 7 seconds What our rent to revenue ratio means is that every rupee we pay in rent we generate 2.62 rupees of revenue and this 6:16 6 minutes, 16 seconds premium is being achieved because we able to negotiate better in terms of rental price points with landlords 6:25 6 minutes, 25 seconds which is being achieved because of the track record that we have been able to operate in these cities and largely the 6:32 6 minutes, 32 seconds competition here is fragmented. That is the primary reason why we are able to achieve a better rent to revenue ratio 6:39 6 minutes, 39 seconds here. The client stickiness is also very high in these markets as 65% of our revenue comes from enterprise clients. 6:49 6 minutes, 49 seconds The clients who whom we have offered a built- solution. The average client lockin which is still left off with us 6:57 6 minutes, 57 seconds is 3.5 years. The return retention ratio is staggering 98%age for us. 7:04 7 minutes, 4 seconds And the net churn rate which essentially means that we add more number of seats from our existing client than we are losing is.6%age. 7:16 7 minutes, 16 seconds The clients that are there with us beyond 300 seats have an average lock in of 37 months 7:24 7 minutes, 24 seconds which would showcase a very strong cash flow for us in the coming months. 7:29 7 minutes, 29 seconds Onethird of our clients are multi-ity clients meaning they would be with us not only in one city on one center they 7:36 7 minutes, 36 seconds would be with us in beyond one city or beyond one center and they have been growing with us across the country and across the centers and we scale along 7:46 7 minutes, 46 seconds with them as I mentioned earlier we are not just a workspace provider we are a full stack enterprise infrastructure 7:54 7 minutes, 54 seconds partner through our integrated platform we offer complete complete end to end managed office space solution which is the core revenue or the cash cow for us. 8:05 8 minutes, 5 seconds Then we have our design and build services which we offer it through our subsidiary wherein external clients 8:12 8 minutes, 12 seconds takes our services of designing and building the entire office space. 8:18 8 minutes, 18 seconds We provide end-to-end facility management services as well and through another subsidiary of SAS joy solutions. 8:26 8 minutes, 26 seconds We offer technology solutions as well. 8:29 8 minutes, 29 seconds Under the same umbrella, we provide recruitment as well as payroll services. 8:34 8 minutes, 34 seconds So this makes us a complete full stack solution provider for global capability centers. GCC's are now an emerging 8:44 8 minutes, 44 seconds consum consumers of IT uh real estate sector in India. The commercial office space largely is consumed by global 8:52 8 minutes, 52 seconds capability centers and we are building from a resource pool perspective from a technology stack perspective a complete 9:00 9 minutes platform where we can offer them end-to-end solutions. This is largely done to capture more wallet share from 9:07 9 minutes, 7 seconds our existing client. Just to site you an example, QX Global, which started with us as the first client back in 2018 with 9:16 9 minutes, 16 seconds a 500 seater space, is still operating and working with us. We are the only preferred partner for that customer and 9:25 9 minutes, 25 seconds operates with us in more than five cities. That is the strength of relationship that we've been able to build. 9:32 9 minutes, 32 seconds Now let me walk you through some of the financial performance which we've been able to demonstrate because of this model. I'll share the consolidated 9:40 9 minutes, 40 seconds numbers. First our revenue from operations for the quarter 3 FI26 stood at 59.2 crores on a comparable basis that is 19%age year. 9:53 9 minutes, 53 seconds For the 9month FI26, we achieved 166.7 crores as revenue, which is a 53%age 10:02 10 minutes, 2 seconds year-on-year growth. Just to help the people that are listening, last complete year we did 158 crores of revenue. 10:11 10 minutes, 11 seconds We achieve 166.7 crores of revenue. Our IITA for 9 month FI26 stood at 77.6 10:20 10 minutes, 20 seconds crores. There is an IITA margin of 46.1%age. 10:25 10 minutes, 25 seconds This again reflects the operating leverage as our mature centers are able to deliver high utilization. 10:32 10 minutes, 32 seconds Our PBT for 9 month FI26 grew 173%age and it is we have been able to achieve 10:40 10 minutes, 40 seconds 5.2 two crores uh as our PBT and we have been consistently delivering 10:47 10 minutes, 47 seconds positivity uh since last past two years at the PBT level on a standalone basis the numbers are 10:55 10 minutes, 55 seconds much more stronger as our revenue grew 50%age year on year ending 124 crores in 11:02 11 minutes, 2 seconds 9 month FI26 our margin increased the to the highest level in the industry which is 61%age 11:10 11 minutes, 10 seconds up from 57.5%age in the same period last year. Our cash EIT for 9 month FI26 is 26.42 crores. 11:22 11 minutes, 22 seconds I'll throw some light on our subsidiaries with one of our design and build subsidiary is the core strength uh of delivering projects faster and 11:31 11 minutes, 31 seconds efficiently. We delivered 38.8 crores of revenue in 9 month FY26 with 16.8%age 8 11:39 11 minutes, 39 seconds percentage of IBITA margin. Overall, we delivered 19 plus projects across 7 lakh 11:46 11 minutes, 46 seconds ft² of area with an average project size being 5,000 ft² and an average project value being 1.25 crores. 11:55 11 minutes, 55 seconds Our rent to revenue ratio has increased from 1.86 in the preceding same period of 9 month 12:01 12 minutes, 1 second FY25 and we have achieved 2.62x of rent to revenue ratio. This showcases our operational efficiency in tier 2 markets. 12:11 12 minutes, 11 seconds As I've shared the numbers, I'll give a quick glimpse of the entire industry as to why we are very bullish on this. The 12:19 12 minutes, 19 seconds Indian flexible office space market is going through a paradigm shift. It is currently valued at $6 billion today and 12:28 12 minutes, 28 seconds it is expected to reach 11.4 billion by 2030. That is a growth of 14%age on a CAGR basis. 12:37 12 minutes, 37 seconds But the compelling story is the shift which is happening in this market. 12:42 12 minutes, 42 seconds According to the recent industry research, managed workspaces, the category in which we operate has grown at 47% CAGGR since 2018. 12:53 12 minutes, 53 seconds It which is outpacing the co-working which is growing at 16%age CAGR. 12:59 12 minutes, 59 seconds GCC's as I touched upon earlier are the single biggest demand driver for flexible office space providers they 13:07 13 minutes, 7 seconds contribute anywhere between 60 to 65%age of the seat observation annually 13:14 13 minutes, 14 seconds India today has 1850 GCC's which is up from 1285 GCC's in FI19 13:22 13 minutes, 22 seconds with approximately 100 to 115 GCC's being added upon every year by 2013 30 13:30 13 minutes, 30 seconds the country expects that we would be serving 2200 GCC's and the employee count would be doubling 13:38 13 minutes, 38 seconds and reaching to 2.8 million. Now this research was being conducted earlier with the advent of safe harbor being 13:46 13 minutes, 46 seconds announced in yesterday's budget. I am certain that this number is grow going to grow exponentially. 13:52 13 minutes, 52 seconds The GCC revenue has achieved a number of $ 105 billion today. GCC consumes approximately 34%age of the India's gradea office market. 14:05 14 minutes, 5 seconds GCC's kind of prefer managed office spaces because we able to provide them long lease tenures with customized solutions. 14:14 14 minutes, 14 seconds They have a lower churn risk and they expect enterprisegradea infrastructure. 14:19 14 minutes, 19 seconds All of that being served by head office space providers. They are not looking for hot desks. They do not want 14:26 14 minutes, 26 seconds dedicated different spaces. They are looking at branded spaces that can scale along with their growth. 14:34 14 minutes, 34 seconds And importantly, GCC's are now looking beyond metros to tap the talent pool. 14:42 14 minutes, 42 seconds Okay. At 16 GR than the next national flexible average hiring in tier 2 cities is also growing 21%age year on year. 14:52 14 minutes, 52 seconds Hence recent times we get lot of GCCs have started coming into tier 2 cities 14:58 14 minutes, 58 seconds they have grown from 5 percentage in FI90 to 20% in FI25 and there are structural shifts these are happening 15:07 15 minutes, 7 seconds largely because the talent arbitrage is high the cost arbitrage is extremely high today tier 2 cities offer 20 to 15:16 15 minutes, 16 seconds 35%age cost advantage over metros in terms of digitally skilled availability of professionals. Tier 2 cities has 15:24 15 minutes, 24 seconds 800,000 people available and we have been witnessing as a country the budget 15:31 15 minutes, 31 seconds the national focus has also been into fulfilling the infrastructure gap in tier 2 cities missions like smart cities 15:40 15 minutes, 40 seconds PM Gatishaki metros being set up and most importantly the connectivity within tier between tier one and tier two 15:48 15 minutes, 48 seconds cities has reduced the infrastructure gap and enforced the global employers to come to tier 2 cities. 15:58 15 minutes, 58 seconds This is precisely the wave we have been waiting and building for since 2017. 16:05 16 minutes, 5 seconds And this quarter we have taken a decisive step to cement our leadership in this. I'll share one of the largest deal that we have signed this quarter. 16:16 16 minutes, 16 seconds We have signed an 8 lakh square ft² of single managed office space contract in Ahmedabad which is on Amly Gopal road 16:24 16 minutes, 24 seconds that's the same micro market wherein we have a current standing of 3 and a half lakh square ft² this is extremely large 16:32 16 minutes, 32 seconds not only from a tier 2 city standard but across the country this would be one of the single largest flex office space 16:39 16 minutes, 39 seconds transaction that we have done I'll just share a few of the limelights of the deal it's 8 lakh 10,000 ft² to be very 16:47 16 minutes, 47 seconds precise. It will have 8,500 seats. We are committing an investment of 100 crores across four years. 16:57 16 minutes, 57 seconds An occupancy of 85%. It will start generating a revenue of 120 crores. 17:03 17 minutes, 3 seconds Now this deal is extremely significant for us because it falls under a development management model. It is an 17:10 17 minutes, 10 seconds re-engineered model spec for the first time that's being done in the flexible office space industry. We ourselves are 17:18 17 minutes, 18 seconds putting in front of the shoes in the shoes of land owners which are non-institutional in nature. Since we understand the quality of assets that 17:27 17 minutes, 27 seconds are preferred by GCC's, we are partnering with land owners, offering them our expertise and skill set, 17:36 17 minutes, 36 seconds building their products or assets within with our processes and helping them to build a grade A plus asset which would 17:44 17 minutes, 44 seconds be leased by us and then offered as a complete solution to global capability center. 17:52 17 minutes, 52 seconds These are purpose-built buildings largely for global capability center which would be operationally extremely 18:00 18 minutes effective and we now onwards intend to scale this up rapidly by partnering with land owners across the country by 18:09 18 minutes, 9 seconds focusing more in tier 2 cities wherein the land ownership is fragmented. Land owners are non-institutional in nature 18:17 18 minutes, 17 seconds but are aspired to have enterprise demand and that is where we would play a role. We would institutionalize that 18:25 18 minutes, 25 seconds supply. We would bring in our expertise and focus on bringing global capability centers set up their offices by offering 18:33 18 minutes, 33 seconds them payroll recruitment and infrastructure under a single umbrella. 18:39 18 minutes, 39 seconds an update on the asset that we had on Amly Boal road which was one of our largest in an operational stock that 18:47 18 minutes, 47 seconds 3.15 lakh square asset which is one of the largest in tier 2 cities will start operations from this quarter which is 18:55 18 minutes, 55 seconds JFM quarter we have already achieved 95% pre-leasing even before going operational this is technically not 19:03 19 minutes, 3 seconds heard of because this size typically takes anywhere between 9 to 12 months to reach 95% occupancy. We have got 95% we 19:13 19 minutes, 13 seconds have achieved 95% occupancy even before going operational. This would add roughly 4,000 seats in the inventory. 19:20 19 minutes, 20 seconds And from a revenue standpoint, it would add 2.75 crores to 3 crores on a month-on-month basis in the uh in the 19:28 19 minutes, 28 seconds operational uh revenue uh that we'll be achieving and the margins we will be operationally positive in this center 19:36 19 minutes, 36 seconds from day one. Few of the marquee clients that we have onboarded here is Manubai and Sha which is a five decade old CA 19:45 19 minutes, 45 seconds firm based out of headquartered in Ahmedabad. They are with us in more than five cities across the country. They are consolidating their entire inventory 19:54 19 minutes, 54 seconds which was not with us in Ahmedabad and shifting their headquarters with us and they have taken 100,000 square ft of 20:02 20 minutes, 2 seconds area. Another client is Walter P. for a globally recognized design and structural consulting firm. They have 20:10 20 minutes, 10 seconds taken almost a full floor there which translates into uh 10,000 ft of area. 20:17 20 minutes, 17 seconds Then open XL start with digital analytics. These are few of the other clients marquee ones which have signed up with us. This campus is located on 20:26 20 minutes, 26 seconds Amibopal road uh wherein the additional 8 lakh square has been signed by us and we are establishing this corridor as a 20:35 20 minutes, 35 seconds flagship for GCC destination in tier 2 cities in in western India. 20:41 20 minutes, 41 seconds I'll share my closing remarks now after the updates. 20:46 20 minutes, 46 seconds We are India's leading managed office space platform in tier 2 cities. We have built a deep mode in landlord 20:54 20 minutes, 54 seconds relationship in bringing client stickiness and built our operational efficiency. We have understood the unique dynamics that are required in this market. 21:03 21 minutes, 3 seconds The landmark deal of 8 lakh square ft² is not just a transaction for us but it is a playbook or a template which we'll 21:11 21 minutes, 11 seconds be replicating in other traditional real estate markets in other tier 2 cities and bringing in innovative solutions by a flexible operator across the country. 21:23 21 minutes, 23 seconds Our vision is clear to become the preferred destination and the preferred infrastructure partner for GCC's in tier 21:30 21 minutes, 30 seconds 2 cities. Again sharing the quick understanding we are there across 28 centers in 12 cities. A strong balance 21:39 21 minutes, 39 seconds sheet and an integrated platform offering build to suit workspaces design and build along with allied services. 21:48 21 minutes, 48 seconds This is a proven playbook that we have showcased as a testimony which we are going to replicate for our future expansion in tier 2 cities. We strongly 21:57 21 minutes, 57 seconds remain confident of delivering sustained growth and long-term value for our shareholders. Thank you everyone for your continued support. I'll now open the floor for questions. 22:09 22 minutes, 9 seconds Thank you very much. We will now begin the question and answer session. 22:14 22 minutes, 14 seconds Anyone who wishes to ask a question may press star and one on their touchstone telephone. 22:21 22 minutes, 21 seconds If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. 22:31 22 minutes, 31 seconds Ladies and gentlemen, we will wait for a moment while the question cue assembles. 22:49 22 minutes, 49 seconds The first question comes from the line of Samit with Amit Capital. Please go ahead. 22:57 22 minutes, 57 seconds Yeah. Hi. Uh am I audible? Yes. Yes, [clears throat] we can hear you. 23:02 23 minutes, 2 seconds Yeah. Yeah. Yeah. Hi. Thanks for the opportunity. So, since I'm new to your business, I just wanted to, you know, understand a few things in depth. So 23:10 23 minutes, 10 seconds what is your sourcing strategy? So is it like you take entire buildings from since you mentioned non-institutional 23:16 23 minutes, 16 seconds landlords or you just have uh a typical 25 to 15,000 square ft uh center size in 23:24 23 minutes, 24 seconds some of the properties sourced by the non-institutional landlords that is one first and what would your uh top 10 uh 23:32 23 minutes, 32 seconds client contribute to your revenues and uh I just wanted to know in your for your DNB division what kind of order 23:39 23 minutes, 39 seconds visibility you have in hand And lastly uh on the new managed office deal which you have signed in Ahmedabad for 8 lakh 23:48 23 minutes, 48 seconds uh 15,000 square ft. So I wanted to know what is the average uh seat size uh per average seat size in that center. 23:59 23 minutes, 59 seconds Sure. Thank you so much sir. Thank you for interesting questions. I'll start with the first one which is our sourcing 24:06 24 minutes, 6 seconds strategy. So we have um two approaches here. Uh first is the city where we are 24:13 24 minutes, 13 seconds not present there. We'll set up anywhere between 25,000 to 40,000 ft² of area. 24:20 24 minutes, 20 seconds We take up 25 to 40,000 ft² because we we our focus is to kind of set up a presence there. Now the dynamics in a 24:29 24 minutes, 29 seconds newer city works um differently and there are multiple stakeholders there. 24:34 24 minutes, 34 seconds Our objective is to become an hyper local player there. So we would understand who our um supplier is in 24:42 24 minutes, 42 seconds terms of who our vendors are basically understanding where we would bring in the furniture and fit outs. That's first understanding that we want to build in 24:51 24 minutes, 51 seconds an ecosystem. Second, I want to understand the dynamics of where and which micro market is evolving and where it is heading towards. 25:01 25 minutes, 1 second So that's the second understanding that I would build. And third, I would want to build a strong pipeline of clients who are looking to take up future 25:09 25 minutes, 9 seconds inventory or future seats or who can be my probable customers. So we would always start small in a newer city that is taking up 25 to 40,000 square of 25:17 25 minutes, 17 seconds area. 2 years later or probably one and a half years later older in that ecosystem in that city once these 25:25 25 minutes, 25 seconds metrices are established we would start taking up larger inventory. Now that inventory would be upcoming in nature 25:33 25 minutes, 33 seconds that is we would sign up an asset let's say 1 and a half years later but the delivery of that asset would be a year down the line. So that gives us the time 25:42 25 minutes, 42 seconds frame to market ourselves and by that time we would have some of the other client who would have committed us bigger inventory for that future supply 25:49 25 minutes, 49 seconds that is coming up with us. So that is a modest apprentic. We would take up 25 to 40,000 ft² of area in a new city. Once 25:58 25 minutes, 58 seconds we are established we were any we would take up anywhere between two lakh to three lakh square ft² in an older city. 26:04 26 minutes, 4 seconds So that's the first uh answer on the sourcing strategy. The top 10 clients the question that you ask the second one 26:12 26 minutes, 12 seconds contributes today roughly 40%age of our entire revenue with respect to our design and build 26:20 26 minutes, 20 seconds contribution. What we have done essentially is we have built a lot of processes since last 3 years and 26:27 26 minutes, 27 seconds annualized if I see since last 3 years we have been growing 100% yearon year. 26:32 26 minutes, 32 seconds So back in 2022 we did 12 crores of revenue then we were able to achieve uh 26:40 26 minutes, 40 seconds 32 crores of revenue. This year we are on the verge of uh achieving almost uh 26:48 26 minutes, 48 seconds 50 crores of revenue by this time frame and December we have closed 38 crores of revenue 26:56 26 minutes, 56 seconds the uh average size. So I think I'll just touch upon a little bit more on the design and build piece because more than 27:04 27 minutes, 4 seconds contributing revenue it also adds lot of value in terms of the resources that we bring in. Just to give you a context on 27:11 27 minutes, 11 seconds this. If I was a standalone company like Dave explained, we do not have this capability of design build. I would not 27:18 27 minutes, 18 seconds have the fe flexibility to hire senior resources in this. Today we have a team of 100 people comprising of project leads with 12 to 15 years of experience. 27:30 27 minutes, 30 seconds Now I'm able to bear that cost because I'm sharing that cost along with with the clients that I'm bringing in on a standalone basis. So if I see from a 27:39 27 minutes, 39 seconds lens of DX, we get the value of quality resources while the cost is not completely born by us and that is being 27:47 27 minutes, 47 seconds shared with uh the the clients that are kind of coming on board. Um with this uh 27:55 27 minutes, 55 seconds resources being added, we are able to kind of reduce down our procurement costs. we are able to make our processes more stringent and effectively achieving 28:04 28 minutes, 4 seconds an output of delivering offices on a timely basis. That is the ultimate uh outcome. 28:10 28 minutes, 10 seconds The focusing on the last question of 8 lakhs perit to be very honest that deal is very closer to our heart. Um we have 28:19 28 minutes, 19 seconds been kind of negotiating on that deal since last one quarter. um it gives us a landmark positioning not only in the 28:28 28 minutes, 28 seconds city but in the entire country because of the sheer size of the uh supply that we have taken up. The average desk size 28:36 28 minutes, 36 seconds that we have witnessed uh within GCC's is anywhere between 60 to 65 per square 28:42 28 minutes, 42 seconds ft. We are expecting roughly around 8,500 seats being consumed in that uh 28:49 28 minutes, 49 seconds asset. On top of that, uh the reality of market is 28:59 28 minutes, 59 seconds loaded to suit product for uh I'm sorry to interrupt. Uh sir, could you please repeat again? 29:13 29 minutes, 13 seconds Hello. U from where did I break? 29:17 29 minutes, 17 seconds Uh it's a few sentences back. Am I audible now? Yeah. 29:21 29 minutes, 21 seconds Right. So I was saying about the 8 lakh square deals we have been kind of negotiating and working on the number 29:29 29 minutes, 29 seconds since last one quarter and uh uh on a per seat size basic uh we have 29:36 29 minutes, 36 seconds experienced anywhere between 60 to 65 per square ft is the consumption pattern by GCCs. 29:42 29 minutes, 42 seconds With this 8 lakh square ft² we are looking at at 8,500 seats of inventory coming here and all the common amenities 29:50 29 minutes, 50 seconds that we typically plan in the asset consume lot of um spaces and reduces the 29:57 29 minutes, 57 seconds effectiveness of the layout for us. Here we would be pre-esigning and keeping lot of common inventories, common features 30:05 30 minutes, 5 seconds like we'll put a game zone, we'll have a box cricket, we'll have a salon, we'll have a daycare facility all incorporated 30:14 30 minutes, 14 seconds in the design of the building that ultimately increase the efficiency of the layout that we can offer to our clients and in turn obviously increasing the revenue for us. 30:24 30 minutes, 24 seconds I hope I was able to answer the uh question. 30:27 30 minutes, 27 seconds And what kind of uh escalations in terms of rentals are you witnessing currently from both the landlord and tenant? 30:37 30 minutes, 37 seconds Yeah. Yeah. So on the supply side, our escalations are anywhere between 4 percentage to 5%age on an annualized 30:45 30 minutes, 45 seconds basis. Um but I'll contextually help you understand this. Um our rent to revenue ratio is 2.62. 62. So let's take an 30:54 30 minutes, 54 seconds example. Uh our rentals are 40 rupees and our revenue that I'm generating from 31:01 31 minutes, 1 second the client is 110 rupees. So my escalation comes on 40 rupees of rental which is anywhere between 4 percentage to 5 percentage. 31:11 31 minutes, 11 seconds While on the client side my escalations are on 110 rupees which is 5 percentage to 6 percentage. 31:19 31 minutes, 19 seconds Okay. on a year-on-year basis. 31:23 31 minutes, 23 seconds Got it. Thanks. If there are more questions, I'll come back in the queue. Sure. Sure. Thank you. 31:34 31 minutes, 34 seconds Thank you. Ladies and gentlemen, if you wish to ask a question, you may press star and one. 31:41 31 minutes, 41 seconds The next question comes from the line of an individual investor. Please go ahead. 31:48 31 minutes, 48 seconds Yeah. Am I audible to you, sir? Yeah, I can hear you. 31:54 31 minutes, 54 seconds Yeah. So, my first question is like uh what progress has been made on the center currently under the fit out during the quarter and uh when are they 32:03 32 minutes, 3 seconds expected to become operational? So, um I'm assuming you're referring to this 3.15 lakh square uh asset. 32:14 32 minutes, 14 seconds So we received the occupancy certificate or building users permission uh in the month of December that is the 27th 32:23 32 minutes, 23 seconds December is when we received the um occupancy certificate. So technically that is when we started full-fledged 32:31 32 minutes, 31 seconds fitouts. We are expected to deliver the project in the next 15 to 20 days of time frame giving us a full-fledged 32:39 32 minutes, 39 seconds revenue towards the end of February and the first week of March. 32:45 32 minutes, 45 seconds Okay. And uh my second question is what is the current occupancy level here and how does it compare to the previous 32:52 32 minutes, 52 seconds quarter and last year and uh what is your outlook for the occupancy in the coming quarter? So in the last quarter 33:00 33 minutes so occupancy has always been north of 85% historically as well. Um the reason 33:08 33 minutes, 8 seconds why occupancy levels are higher in our case is because we are focusing being an enterprise or a managed office space 33:15 33 minutes, 15 seconds provider. So we largely would have a customer on on hand before we sign up a new supply. 33:23 33 minutes, 23 seconds This quarter we've been able to achieve 88.4%age of occupancy number but historically also the numbers have been 33:30 33 minutes, 30 seconds north of 85%age um largely uh as uh the enterprise client. 33:41 33 minutes, 41 seconds Okay. 33:43 33 minutes, 43 seconds My CFO as well to kind of add a point on that. So basically the occupancy for the good part about our business is like are 33:52 33 minutes, 52 seconds out of 8.83 million square foot are 70% centers are 100% occupied. So basically 33:59 33 minutes, 59 seconds the occupancy is 88.4%age 4 percentage what we consider as a center level profitability and center level occupancy 34:06 34 minutes, 6 seconds out uh out of 83 million square foot 58 is my all the available areas are occup 34:18 34 minutes, 18 seconds you can evaluate okay and uh uh I have one more question like how quickly do a new center 34:26 34 minutes, 26 seconds particularly GCC project become the ROC attraction and what is the typical timeline to reach steady state return? 34:36 34 minutes, 36 seconds So the I'll break this into two parts. 34:39 34 minutes, 39 seconds Uh let's say a center is of a size of less than 50,000 square ft of area. So 34:46 34 minutes, 46 seconds that's a traditional uh deal wherein the landlord would give us the space. We would invest in the fit outs and deliver 34:55 34 minutes, 55 seconds a customized office to our enterprise clients. there are ROC is 36 months. 35:03 35 minutes, 3 seconds Okay. 35:03 35 minutes, 3 seconds But in larger centers uh but in you know the centers like 3.15 lakh square center there we are forecasting our ROCB to be 35:12 35 minutes, 12 seconds around 27 months and there are logical reasons to that. One of the uh biggest driver to achieve that outcome is the 35:21 35 minutes, 21 seconds rentry period that we are able to achieve in larger assets. So typically a re-entry period in a smaller asset is 35:28 35 minutes, 28 seconds anywhere between 3 months to 4 months while in larger assets we are able to achieve 8 months to 12 months of entry period. That is one primary driver. 35:38 35 minutes, 38 seconds Second we are able to bring in common areas from a percentage basis to an extremely 35:45 35 minutes, 45 seconds low level. So let's say if a 40,000 ft² area is being built, the common areas that I have to incorporate ranges 35:53 35 minutes, 53 seconds between 22 percentage to 25 percentage which which includes my lounge, my meeting rooms, my conference rooms, my 35:59 35 minutes, 59 seconds game area, my cafeteria. Now that percentage in a bigger area like 3 and a half lakh square of building drops to 16%age. 36:09 36 minutes, 9 seconds So technically giving us a saving of 5 6% which increases the revenue for us. 36:16 36 minutes, 16 seconds Okay. Okay. Uh yeah. Okay. Thank you sir. That's all from my side. Okay. And all the best for the next. 36:25 36 minutes, 25 seconds Thank you so much. 36:28 36 minutes, 28 seconds Participants. If you wish to ask a question, you may press star and one. 36:33 36 minutes, 33 seconds The next question comes from the line of Rohit Mea with SK securities. Please go ahead. Yeah, thank you for the opportunity sir. 36:42 36 minutes, 42 seconds Uh so my first question is related to the tier 2 cities. Uh during the opening remarks you mentioned tier 2 cities will be our target or target uh uh hence for 36:52 36 minutes, 52 seconds like cities like Indor and Udaur, Jaipur. Uh so what is the strategic rational for focus on tier 2 cities and how large addressable opportunity there? 37:04 37 minutes, 4 seconds Sure sir. Um we are a belief that tier 2 cities would pave the next wave of 37:11 37 minutes, 11 seconds growth as a country. If you have to grow from $4 trillion economy to 10 trillion dollar economy, the contribution 37:19 37 minutes, 19 seconds from tier 2 cities like Ahmedabad, Jaipur, Indor, Bodha, Chandigar would be way higher as compared to tier one 37:27 37 minutes, 27 seconds cities and and that is significantly showcased by the policies as a country that we are uh you know putting across. 37:36 37 minutes, 36 seconds uh the infrastructure push in fact is also been higher in tier two cities and on ground what we have been witnessing 37:43 37 minutes, 43 seconds since last seven years is the fact that the talent pool available in these cities is much more loyal 37:53 37 minutes, 53 seconds stays with you for a longer duration the arbitrage cost arbitrage of the talent is also higher here so let's say a react 38:02 38 minutes, 2 seconds developer resource that is available in Bangalore is a react developer available uh cost 38:08 38 minutes, 8 seconds of that resource in boda is at least 25 to 30% lower and that gives an advantage for the last 38:17 38 minutes, 17 seconds mile employer to consider tier 2 cities as the market to expanding um that's first reason second is cost 38:26 38 minutes, 26 seconds arbitrage the real estate cost is also significantly lower say a city like Mumbai which wherein we also have our 38:34 38 minutes, 34 seconds center um we have taken up a place at 120 rupees per square ft while a city 38:40 38 minutes, 40 seconds like Jaipur uh is being uh taken up at 60 to 65 rupees per square foot. So 38:47 38 minutes, 47 seconds that's the uh arbitrage that end employers are able to see and witness and hence the transition uh or shift to tier 2 cities is happening faster. 38:59 38 minutes, 59 seconds Got it. Got it. uh so uh henceforth the we will see the margin expansion due to the tier tier two cities focus and all 39:09 39 minutes, 9 seconds so we are currently also focusing on tier 2 city our 70%age of our revenue comes from tier 2 cities 39:18 39 minutes, 18 seconds yes yes okay and uh how is the Ahmedabad mega campus and similar large DCC projects 39:25 39 minutes, 25 seconds are funded How we are funding that is is the question. 39:32 39 minutes, 32 seconds Yes. Yes sir. 39:35 39 minutes, 35 seconds So currently under the development management model we do not incur the cost of developing the asset. The 39:43 39 minutes, 43 seconds capital investment from land to development is done by the land owner only. Our investment comes in paying 39:50 39 minutes, 50 seconds security deposit and investing in the fit outs. That is where our investment lies. In fact, for monitoring of the 39:58 39 minutes, 58 seconds project, we are that has now become a revenue stream for us. Since we bring in our expertise to build a grade A asset, 40:07 40 minutes, 7 seconds that quality is now helping us to generate revenue from the landlords because we building expertise to 40:16 40 minutes, 16 seconds establish a grade A plus asset. So that knowledge that understanding of global market is what we bring across the table 40:25 40 minutes, 25 seconds uh as our contribution to monitor that asset. So develop land owners would pay us a certain fees to overlook developing 40:33 40 minutes, 33 seconds development of that asset while we our task would be to then um invest in fitouts bring in GCC's offer them a 40:43 40 minutes, 43 seconds fully fledged solution and then serve them across years. 40:49 40 minutes, 49 seconds Okay. So uh thank you for a very elaborative answer. Uh that is it from my side. Uh for any question I will back in the queue. Thank you so much. 41:00 41 minutes Thank you. 41:02 41 minutes, 2 seconds Thank you. Ladies and gentlemen, if you wish to ask a question, you may press star and one. 41:08 41 minutes, 8 seconds The next question comes from the line of Raj Sha with Digital Analytics. Please go ahead. 41:16 41 minutes, 16 seconds Yeah. Hi, thank you for the opportunity. 41:18 41 minutes, 18 seconds Uh my question is with with regards to the four new centers that we are uh which are under the pipeline currently. 41:25 41 minutes, 25 seconds So I wanted to know like when are we expecting these four new centers to get operational and uh what a bit margins can we expect from these centers? 41:39 41 minutes, 39 seconds Sure. So one of the largest center in that is capital one which is 3.15 lakh 41:46 41 minutes, 46 seconds square ft² of area. We are expecting the revenues to start from end of February to early uh first couple of weeks of 41:56 41 minutes, 56 seconds March. Um and as I mentioned that asset is uh is would be generating a faster 42:03 42 minutes, 3 seconds ROC for us. At a center level typically we operate at uh 30 35% margin. For the 42:11 42 minutes, 11 seconds first few months this center would be operating at 60 65 percentage margin because of the rentree availability there and obviously because of the size 42:20 42 minutes, 20 seconds um scale that we have and we have been able to kind of uh bring in operational area much more effectively. So the 42:27 42 minutes, 27 seconds layout and the is kind of much more similar that is one second uh second 42:34 42 minutes, 34 seconds center is in Pune. We have just got the position of that center. We'll be starting the fit outs now. Uh we are expecting that center to go live in the 42:44 42 minutes, 44 seconds month of April end or May first week. We already have 50% um occupancy already 42:51 42 minutes, 51 seconds achieved there uh even before the fit outs being started. Uh so there we can expect uh anywhere between 35 to 40%age 42:59 42 minutes, 59 seconds of uh margins being achieved. And uh there's one more center um in Ahmedabad 43:06 43 minutes, 6 seconds which is million miles. We have started the fit outs there. We have reached to a stage when we are awaiting occupancy 43:14 43 minutes, 14 seconds certificate from the developer. Once that is achieved achieved uh post that 25 days to 30 days we'll be operational 43:21 43 minutes, 21 seconds there. Again we have a pre-committed demount demand there. Um so we are expecting the revenue to kickstart from April or May. um we had signed that 43:30 43 minutes, 30 seconds asset um before time so we have a good leverage on rentals uh so that there the margins would be 40 45%age 43:39 43 minutes, 39 seconds internal and uh fourth asset would be GMDC asset the development of that asset is currently ongoing we are expecting to 43:49 43 minutes, 49 seconds get the delivery of that asset in the month of September or October and that asset from an operational perspective would be December January uh 26 or 43:57 43 minutes, 57 seconds January 27th All right. Understood. Onto that mega center that you mentioned in uh local. 44:09 44 minutes, 9 seconds So will that is it is it considered under uh signed pipeline uh or is it under fit out right now? 44:18 44 minutes, 18 seconds No. No. We have just signed that deal. 44:21 44 minutes, 21 seconds Uh it is a development management contract with the land owner. The entire building is yet to be uh developed. We 44:28 44 minutes, 28 seconds have just onboarded one India's one of the largest uh and the prominent architects to start the designing process there. 44:36 44 minutes, 36 seconds All right sir. And uh sir the revenue guidance that you have provided for FI27 for 350 cr. So uh can I expect these 44:46 44 minutes, 46 seconds four centers that you mentioned Pune million mile and GMVC along with the capital one to uh kind of contribute majorly towards that revenue. 44:57 44 minutes, 57 seconds Yeah. Yes. So the the revenue forecast for 27 was done bases the same line with the current centers that we already 45:06 45 minutes, 6 seconds planned and achieved. Uh the supply on hand are the same ones that going to be supporting us in achieving an outcome of 45:14 45 minutes, 14 seconds 350 crores. It comprises of three revenue streams. One is our manage office space uh contribution. Uh second 45:22 45 minutes, 22 seconds is our design and build unit and third is our technology unit of uh SASJ solutions. 45:29 45 minutes, 29 seconds Understood sir. Uh and then one last bookkeeping question. So uh in this quarter other expenses have increased by 45:36 45 minutes, 36 seconds more than 100% for the standalone business. So any specific uh corporate expenses that has contributed to this increase or is this one of? 45:48 45 minutes, 48 seconds No, these are one of expenses uh onetime expenditures that were incurred uh post the IPO processes. 45:56 45 minutes, 56 seconds Okay, that was approved in this quarter. Okay. All right. All right. Thank you. 46:04 46 minutes, 4 seconds Thank you sir for taking up my question and all the best. Thank you. Thank you so much. 46:13 46 minutes, 13 seconds The next question comes from the line of Anik Rakar and individual investor. Please go ahead. 46:20 46 minutes, 20 seconds Um uh good afternoon sir. Very good afternoon. Yeah. Good afternoon sir. 46:29 46 minutes, 29 seconds Yeah. Yeah. So sir I have audible question. Yes. Yes. Yes sir. Sure. 46:36 46 minutes, 36 seconds Yeah. So sir uh in terms of our GCC just wanted to understand uh how this GCC uh 46:42 46 minutes, 42 seconds demand evolve on a Y basis uh and uh what basically the rational behind this um GCC across uh TI2 market. 46:54 46 minutes, 54 seconds Sure. Well, largely I mean if you understand uh India from an service 47:01 47 minutes, 1 second standpoint um in two early 2000s we were a BO market for the globe right so we used to be the back office for the for 47:10 47 minutes, 10 seconds the world so people used to set up their BPOS call centers and that kind of helped them support their global growth 47:18 47 minutes, 18 seconds so from 2000 to 2010 if you see we have been largely uh voice or chat support system for the group. 47:28 47 minutes, 28 seconds 2010 onwards the country evolved and we started attracting knowledge process outsourcing units. So lot of accounting 47:36 47 minutes, 36 seconds units, lot of financial units, MLA units kind of were set up as back offices in the country. With the advent of 47:45 47 minutes, 45 seconds education uh and the exposure that we as a country got lot of evolvement happened on the technology front and the 47:54 47 minutes, 54 seconds contribution at the global level uh from development perspective also increased. 47:59 47 minutes, 59 seconds So 2017 18 onwards we saw lot of financial units setting up their back offices in India and that is where it 48:09 48 minutes, 9 seconds got unearthered that development can also be a strong backbone for them to set up in India rather than just voice 48:16 48 minutes, 16 seconds chat or accounts. It can also be that we can build products we can do R&D here and then support their global expansion. 48:26 48 minutes, 26 seconds That is all when it started and today when we see lot of companies set up their development units, R&D units in 48:34 48 minutes, 34 seconds India. Uh roughly 18 15 GCC's are operating in the country. Why we are 48:41 48 minutes, 41 seconds kind of u pursuing them? Uh primary reason is it it is a full spectrum of solution. It increases a single 48:50 48 minutes, 50 seconds contribution of revenue from a client rather than providing just an infrastructure. We can be a partner for 48:57 48 minutes, 57 seconds them in growth which helps them understand how do they hire people, where do they hire people from, where is 49:04 49 minutes, 4 seconds that talent coming from, what is the design of workspace that can inspire people to stay for longer duration. 49:11 49 minutes, 11 seconds These are the sort of conversions that can become a partner for our clients and not just a vendor client relationship and that is the advant why we are 49:20 49 minutes, 20 seconds focusing on GCC and categorically in tier 2 cities is the backbone or strength of ours as I said earlier. I'm 49:29 49 minutes, 29 seconds a firm believer that the next wave of growth in the country is coming from tier 2 cities and it is uh inevitable 49:37 49 minutes, 37 seconds from the policies that we are witnessing today. lot of infrastructure investments are going into tier two cities uh and 49:45 49 minutes, 45 seconds to attract talent to reach out to the right mindset and the infrastructure that is getting evolved. Lot of global 49:55 49 minutes, 55 seconds companies you would see now coming to tier 2 cities with a greater push. They were already coming in but it was not at 50:02 50 minutes, 2 seconds the pace or speed the tier ones were attracting. probably next couple of years is when we will witness lot of 50:09 50 minutes, 9 seconds global capability centers setting up their primary offices in tier two cities. 50:15 50 minutes, 15 seconds Okay. Okay. And sir uh one last question um uh uh what is the current I mean uh how much is the market opportunity for 50:24 50 minutes, 24 seconds us and how much uh we already uh targeted 50:32 50 minutes, 32 seconds uh market opportunity from just a managed office space perspective you're referring to GCC uh 50:38 50 minutes, 38 seconds no no problem from GCC perspective so today GCC's uh I'll I'll come down 50:46 50 minutes, 46 seconds top to bottom, right? I mean, today from a flexible office space market, we are at a $5 billion contribution. This is 50:54 50 minutes, 54 seconds bound to reach around 11 billion in terms of uh market size. Now, out of 51:00 51 minutes this 60%age is by GCC's, right? So, we can u easily evaluate that 51:08 51 minutes, 8 seconds it is 6 to7 billion of revenue being contributed by GCC. Now out of all of that 21%age is being contributed by the flexible office. 51:19 51 minutes, 19 seconds Okay. 51:20 51 minutes, 20 seconds And within that we hold 13%age market share in tier 2 cities. Okay. Okay. 51:28 51 minutes, 28 seconds That is the market size that we are probably looking to acquire. 51:32 51 minutes, 32 seconds Good, good, good. Thank you sir. This is from my side and all the best for the future. Thank you so much. 51:40 51 minutes, 40 seconds Thank you participants. If you wish to ask a question, you may press star and one. 51:48 51 minutes, 48 seconds The next question comes from the line of Rohan Mata, an individual investor. Please go ahead. 51:55 51 minutes, 55 seconds Hello. Uh good afternoon sir. Thank you for the opportunity. So just uh you spoke about the uh geographical uh uh 52:02 52 minutes, 2 seconds spread out that we have and you touched upon the rational behind tier 2 cities. 52:07 52 minutes, 7 seconds If you could also just uh give some color on what kind of which cities uh if you're looking at it in that particular 52:14 52 minutes, 14 seconds way which cities are giving us uh relatively higher uh revenue and seat capacity and where the growth has come 52:22 52 minutes, 22 seconds in from in terms of operational area centers and uh seat capacity. 52:27 52 minutes, 27 seconds Sure. So we are currently from a tier 2 standpoint we are currently focused on 52:32 52 minutes, 32 seconds Amhabad Boda Rajcot Surat Gandhi Nadar that's that's the Gujarat belt then we 52:41 52 minutes, 41 seconds are focusing on indoor in MP and in Rajasthan we are focusing on Jaipur and Udaur 52:50 52 minutes, 50 seconds that that is our current uh uh presence we intending to add few more tier 2 cities which we are currently 52:58 52 minutes, 58 seconds researching and analyzing as to what growth parameters can be done. I'll share top level thoughts on that as 53:06 53 minutes, 6 seconds well. Lucknau, Bubneshwar, Kohim Batatur and Kochi. These are four other cities 53:13 53 minutes, 13 seconds that we are currently evaluating from uh our from taking up a exposure there and we are speaking to few of our clients in 53:22 53 minutes, 22 seconds understanding their growth uh metrics is there. Um personally I think cities like 53:28 53 minutes, 28 seconds Ahmedabad, Bura and Jaipur would be outliers for us and uh for the country 53:36 53 minutes, 36 seconds as well because that is where majority of the infrastructure investment has already been done. Um some of the 53:43 53 minutes, 43 seconds marquee events like Commonwealth game which has already been signed by Ahmedabad would probably shape as to how 53:50 53 minutes, 50 seconds the city would grow and evolve into and u with the advent of that being already being done. I think we participating 53:58 53 minutes, 58 seconds more in that growth would only help us in scale up faster. 54:04 54 minutes, 4 seconds Got it. Got it sir. So as of now do you see uh do you look at it in terms of a bifurcation between revenue coming in from tier two versus tier one? 54:15 54 minutes, 15 seconds Oh yeah. 54:17 54 minutes, 17 seconds Um no so I think we categorically want larger portion of our chunk coming to 54:24 54 minutes, 24 seconds tier 2 cities. We are today our revenue contribution is 7030 and 70%age comes from tier 2 cities and tier one 54:33 54 minutes, 33 seconds contributes 30%. Going forward also our focus would be to continue with this uh share of revenues coming in from tier 2s and tier ones. 54:43 54 minutes, 43 seconds Understood sir. 54:44 54 minutes, 44 seconds I mean I'll tell you the logics behind this. Sorry. Yes sir. Please go ahead. 54:50 54 minutes, 50 seconds Yeah I'll I'll explain the logic behind this for the interest of everybody since the the questions are focusing more on tier 2 cities. See in this sector the 54:59 54 minutes, 59 seconds entry barriers is not that high right there are a lot of lifestyle businesses as well opened up into this sector. Um 55:08 55 minutes, 8 seconds what we are essentially doing is creating a virtual entry barrier in this year two cities. 55:14 55 minutes, 14 seconds Today I can proudly say that I'm one of the I'm the largest u operator in in Ahmedabad. I'm the largest operator in 55:21 55 minutes, 21 seconds Boda. I'm the largest operator in Jaipur. Now these statements are not mere statements to uh these are not just 55:29 55 minutes, 29 seconds uh headlines for our marketing perspective. These are on ground challenges that I'm throwing for my peers to enter in those cities. is a 55:37 55 minutes, 37 seconds kind of virtual entry barriers for the external or the tier one players to enter into the cities. 55:45 55 minutes, 45 seconds Right. Right. Fair enough. So that makes sense. 55:48 55 minutes, 48 seconds So would you say that tier one cities have saturated in terms of competition with with so many players being there. 55:58 55 minutes, 58 seconds So that is also one of the reason u why we kind of shying away from entering in a very big way in tier one cities. But 56:05 56 minutes, 5 seconds having said that we need to be uh mindful of the fact that today Bangalore, Delhi and Mumbai contributes 56:12 56 minutes, 12 seconds largest consumption of real estate in we can't deny the reality on um yes it 56:19 56 minutes, 19 seconds is saturated. Yes it is moving to tier 2 cities but still they contribute the largest in terms of consumption of real estate. Hence we need to take a pie 56:28 56 minutes, 28 seconds something from there and also the decision makers are in these tier one cities. So our presence in front of them becomes inevitable for us to win them in tier 2 cities. 56:39 56 minutes, 39 seconds All right. All right. Fair enough. Also, if you could touch upon uh how much of growth comes in from new client 56:47 56 minutes, 47 seconds additions versus uh you know expansion of an existing client or the you know recurring revenue from an existing client. Do we do you look at revenue from these two perspectives? 56:58 56 minutes, 58 seconds Yes. So u I'll I'll share this contextually. Um QX Global as I mentioned um has been with us since 2018. 57:08 57 minutes, 8 seconds Retention of our client is one of the primary metrics for us. Um in my investor deck if you see we have bucketed them into three categories. 57:19 57 minutes, 19 seconds Clients who are there consuming almost 100 seats with us. Clients who are consuming between 100 to 300 seats. and 57:28 57 minutes, 28 seconds clients consuming more than 300 seats with us. I have a staggering 57%age continuation 57:37 57 minutes, 37 seconds coming from 100 seats who are with who are going to stay with us for more than 2 years. That's a lock in period between 57:45 57 minutes, 45 seconds 100 to 300 seats. I have clients who going to stay with us for almost 3 years of time frame. and for more than 300 57:54 57 minutes, 54 seconds seats bucket we have clients who going to stay with us beyond 3 years locking and these are locking duration that I'm seeing agreement tenure is obviously at 58:03 58 minutes, 3 seconds least 30%age higher than that which means we have witnessed in the past that they're going to continue with us at least till the agreement tenure they do 58:12 58 minutes, 12 seconds get a right to exit after the locking period as well but that right has not yet been exercised in our case that is not the journey that we have seen yet we 58:20 58 minutes, 20 seconds are not seeing clients moving out of our private So answering your question, categorically we have seen our existing clients contribute more in our growth 58:29 58 minutes, 29 seconds story and contribute more to our revenue uh while we are kind of expanding rapidly. Uh in the but having said that 58:37 58 minutes, 37 seconds 2022 2023 were an outliers for us wherein lot of external demand also had to be brought in by us uh because we 58:45 58 minutes, 45 seconds were expanding at a pace of more than 50%age. 58:49 58 minutes, 49 seconds Right. Right sir. So speaking of seats, what would be our current total uh capacity utilization in terms of occupancy of seats? 58:58 58 minutes, 58 seconds We are at 88 some percentage being occupied by us. 59:03 59 minutes, 3 seconds 88 by the client. Uh so out of 13 and a half thousand seats that translates into some 12 odd thousand seats being 59:10 59 minutes, 10 seconds consumed by the clients. But I think to be very honest um from an industry parlance I probably share this number because it is a metric that has been 59:19 59 minutes, 19 seconds create created within the industry. Um honestly that is not how I prefer to get monitored. um the number of sweets or 59:28 59 minutes, 28 seconds the number of clients that are kind of continuing with us after the locking and the quantum of revenue that is going to stay with me for the next 3 years is the 59:36 59 minutes, 36 seconds right metrics for me to get monitored or judged upon because in a managed office space um even while I was small uh at 59:45 59 minutes, 45 seconds 100,000 or 200,000t of area I was achieving more than 85% 90%age occupancy level because I'm technically designing 59:53 59 minutes, 53 seconds the space for a bigger client uh my speculative take up is very le less in nature. We work on a hedging sort of an 1:00:02 1 hour, 2 seconds environment where my lockins from the supply gets hedged by the lockins from the client. My exposure of lock in rental gets hedged from the exposure of 1:00:10 1 hour, 10 seconds revenue that I'm supposed to receive from the client. Got it. Got it. Did I make sense? 1:00:18 1 hour, 18 seconds Fair enough, sir. No, that that makes a lot of sense. And you also answered another question that I would have asked about the KP KPIs that we should look at the key performance indicators. 1:00:27 1 hour, 27 seconds Yeah. 1:00:27 1 hour, 27 seconds So that is very helpful. Sir, just I'll conclude with a question. If you could have any long-term vision in terms of our revenues maybe 2 three years down the line. Uh that's all sir. 1:00:39 1 hour, 39 seconds Um well I'm a newly listed promoter. I'm not sure how much I'm supposed to share 1:00:46 1 hour, 46 seconds here but u as I've given an outlook in FI27 we are looking at a numbers of 350 crores being achieved across three 1:00:54 1 hour, 54 seconds revenue streams so largely managed office space contributing uh the larger number uh then design and build becoming 1:01:02 1 hour, 1 minute, 2 seconds much more stronger effective and across the country and our SAS solution which is a technology unit where in our recruitment payroll and customized 1:01:12 1 hour, 1 minute, 12 seconds solutions for our enterprise clients uh kicking in. Uh these all three would be kind of uh contributing and helping 1:01:19 1 hour, 1 minute, 19 seconds us to achieve a revenue outlook of uh 350 crores by FY27. 1:01:25 1 hour, 1 minute, 25 seconds Got it. Got it. Okay sir. That that was all from my side. Thank you. Thanks a lot for taking my questions and all the best. 1:01:33 1 hour, 1 minute, 33 seconds Thank you so much sir. 1:01:36 1 hour, 1 minute, 36 seconds Thank you ladies and gentlemen. If you wish to ask a question to the management, you may press star and one. 1:01:44 1 hour, 1 minute, 44 seconds The next question comes from the line of Anand Mundra with my temple capital. Please go ahead. 1:01:51 1 hour, 1 minute, 51 seconds Hello. Uh thank you for the opportunity. 1:01:53 1 hour, 1 minute, 53 seconds Uh sir this might be slightly repetitive for you because I I my apologies I joined the call late but I just wanted to understand the economics of the 1:02:02 1 hour, 2 minutes, 2 seconds development management model that you've highlighted in the class and the minister presentation with regards to 1:02:08 1 hour, 2 minutes, 8 seconds the new 8 lakh square ft of deal that you won in end sure sir thank you so much and I'll send 1:02:17 1 hour, 2 minutes, 17 seconds a special thank you notes uh this will help all the people that are listening to get a much more clar ity on development management model. It is a 1:02:26 1 hour, 2 minutes, 26 seconds new model that has been kind of uh financially re-engineered by it. So I'll give a background on this. Um we did a 1:02:35 1 hour, 2 minutes, 35 seconds development management model which is a prop co-op model as well for us wherein right from the land stage we partnered 1:02:42 1 hour, 2 minutes, 42 seconds with the land owner. We told them that we want specs of this quality. We want a 1:02:49 1 hour, 2 minutes, 49 seconds grade A+ asset. Something what is easily available accessible in tier one cities is not available in tier two cities. So 1:02:58 1 hour, 2 minutes, 58 seconds for us the entire game that is being played is on the supply side and not on the demand set across the country. If 1:03:06 1 hour, 3 minutes, 6 seconds you see uh grade A plus assets enjoy north of 95%age of occupancy level. 1:03:13 1 hour, 3 minutes, 13 seconds Now if this statement is true, tier 2 cities do not have lot of grade A or A plus assets and that is where we thought 1:03:21 1 hour, 3 minutes, 21 seconds there's a larger vacuum that can be solved by us. So we started approaching land owners told them that there are lot 1:03:28 1 hour, 3 minutes, 28 seconds of skill sets that we have achieved in the last 7 years which we can share it with you. skill sets like understanding 1:03:36 1 hour, 3 minutes, 36 seconds what is the uh ratio on a single floor plate. Uh what can be the column width? 1:03:44 1 hour, 3 minutes, 44 seconds Uh what are the common amenities or features that can be added in the building and what are the specs on the electrical 1:03:52 1 hour, 3 minutes, 52 seconds side? How does the fire design gets built in so that you can attract fortune 500 clients? You know lot lot such 1:03:59 1 hour, 3 minutes, 59 seconds pointers. There's a there's a detailed questionnaire uh pointers that has been created for the land owner to get onboarded with us. Roughly around 190 1:04:08 1 hour, 4 minutes, 8 seconds odd points are being created by us as to how a supply is grade A or A+. Now we told them that we'll bring in expertise 1:04:16 1 hour, 4 minutes, 16 seconds on the architectural side, on the NEP side, on the structural side and on the 1:04:22 1 hour, 4 minutes, 22 seconds PMC side. These are all four par aspects of the development of the building which we will cover it from our side. The 1:04:31 1 hour, 4 minutes, 31 seconds contracting piece can be done by you. If you want we can bring in an external partner as well. But that remains a decision to be taken going down the line 1:04:40 1 hour, 4 minutes, 40 seconds for doing this. The revenue that we will charge them is anywhere between 400 rupees to 600 rupees per square ft. 1:04:49 1 hour, 4 minutes, 49 seconds So if I'm building let's say 100,000 square ft of area I'll charge them 100,000 rupees into on 1:04:56 1 hour, 4 minutes, 56 seconds an average 500 rupees per square foot that is the revenue that comes in my books 1:05:04 1 hour, 5 minutes, 4 seconds and the entire investment from a land stage is done by the land owner. 1:05:09 1 hour, 5 minutes, 9 seconds the the development investment is incurred by the land owner that can be done in the form of equity or debt that 1:05:17 1 hour, 5 minutes, 17 seconds is at the priority of the land owner. So that is how it helps us. A it creates a strong pipeline for of great assets in 1:05:24 1 hour, 5 minutes, 24 seconds tier 2 cities. B it creates a stable source of revenue for us as well when we are just capitalizing on our existing 1:05:32 1 hour, 5 minutes, 32 seconds resources and skill set and experience that we acquired. Did I kind of answer that question sir? 1:05:39 1 hour, 5 minutes, 39 seconds Yeah. So is the operations also then once the building is developed uh is the is the operations also managed by us? Do 1:05:47 1 hour, 5 minutes, 47 seconds we put the entire unit on rent ourselves? Uh how does I mean post the development how does it work? Yeah. 1:05:55 1 hour, 5 minutes, 55 seconds So I mean one of the primary aspect of shining a development management model is that we want to have uh the operational side of the business because 1:06:03 1 hour, 6 minutes, 3 seconds that is the core bread and butter for us. Um we wanted grade A supplier to come in at the time at a uh at a micro 1:06:13 1 hour, 6 minutes, 13 seconds market where we where we want which was not coming in effectively and hence this DM model will help us achieve that. So operational 1:06:22 1 hour, 6 minutes, 22 seconds uh agreement is mandatory if that is true if that um selection is done by our 1:06:29 1 hour, 6 minutes, 29 seconds research team then only we go ahead and sign the DM model. 1:06:34 1 hour, 6 minutes, 34 seconds Okay. Okay. Okay. And then once the so then then it's the straight lease model that that takes up like do we pay a fix 1:06:41 1 hour, 6 minutes, 41 seconds each rental every month and the normal contract ship. Okay. Okay. That's correct. That's correct. 1:06:47 1 hour, 6 minutes, 47 seconds So at the at the development stage there's an additional 400 to 600 square ft per per square ft that we charge to the client for our expertise in 1:06:55 1 hour, 6 minutes, 55 seconds designing the building and post that it's a normal state please model that that okay that happens that kicks in. That's that's right. 1:07:04 1 hour, 7 minutes, 4 seconds Okay. Okay. But here the capeex is done by the the the only difference is that the capeex is being done carried on on the books of the the developer the the land owner. Yes. 1:07:16 1 hour, 7 minutes, 16 seconds Okay. Okay. Understood. Understood. Uh thank you. 1:07:20 1 hour, 7 minutes, 20 seconds We are typically looking at land owners rather than developers because uh developers would preferably not get into 1:07:28 1 hour, 7 minutes, 28 seconds agreement with us. Land owners are the ones who would prefer to get into arrangement with us because those are the ones who would look at uh long-term rental revenues um on an ongoing basis. 1:07:41 1 hour, 7 minutes, 41 seconds Understood. Understood. 1:07:43 1 hour, 7 minutes, 43 seconds Understood. Thank you. Thank you. Thank you. Thank you so much, sir. 1:07:50 1 hour, 7 minutes, 50 seconds Thank you. As there are no further questions from the participants, I would now like to hand the conference over to Mr. for closing comments. 1:08:02 1 hour, 8 minutes, 2 seconds Thank you so much everybody for coming on the call. Uh we value and respect the time that you're given to understand our business. Uh we look forward to your 1:08:10 1 hour, 8 minutes, 10 seconds continued support uh going down the line. Thank you so much. 1:08:18 1 hour, 8 minutes, 18 seconds Thank you on behalf of Dave Accelerator Limited. That concludes this conference. 1:08:23 1 hour, 8 minutes, 23 seconds Thank you for joining us and you may now disconnect your lines. Thank