Ksolves India Ltd — Q4 FY26

Ksolves India Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=7-PAxqjh3UM Published: 13 days ago

0:01 1 second Ladies and gentlemen, good day and welcome to the Kols India Limited Q4 FY26 earnings conference call. 0:11 11 seconds As a reminder, all participant lines will be in the listenonly mode and there will be an opportunity for you to ask 0:19 19 seconds questions after the presentation concludes. 0:22 22 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 0:32 32 seconds conference over to Mr. Pratik Chhatab from ENY investor relations. Thank you and over to you sir. 0:39 39 seconds Thank you Sima. 0:41 41 seconds Welcome everyone and thanks for joining Kols India Limited Q4 FY26 earnings call. The results have been mailed to 0:50 50 seconds you along with the investor presentation and it is also available at www.ksols.com. 0:58 58 seconds In case anyone does not have the copy of investor presentation, please do write to us and we will be happy to share it 1:06 1 minute, 6 seconds with you. Joining us today from the management team is Ratan Pastasau, chairman and managing director, Oman 1:14 1 minute, 14 seconds Sony, chief financial officer, Manish Gurani, chief technology officer, Darpan 1:21 1 minute, 21 seconds Audi, head business transformation and consulting, Mayan Shukla, technical 1:27 1 minute, 27 seconds project manager AI. We will begin with management's remark covering the business update and quarterly 1:34 1 minute, 34 seconds performance highlights and then move on to the Q&A session. Before we start, I would like to remind you that anything 1:42 1 minute, 42 seconds that is said on this call that reflects any outlook for the future or which can be conceived as a forward-looking 1:49 1 minute, 49 seconds statement must be viewed in conjunction with the risks and uncertainties that we face. These risks and uncertainties are 1:59 1 minute, 59 seconds included but not limited to what we have mentioned in the prospectors filed with sebi and subsequent annual report that 2:07 2 minutes, 7 seconds you can find it on our website. Having said that I will now hand over the call to ratan sir. Over to you sir. Thank you. 2:19 2 minutes, 19 seconds Welcome and thank you everyone for joining our Q4 financial year 26 earning call. 2:27 2 minutes, 27 seconds FY26 marked an important milestone as we crossed 150 cr in annual revenues 2:36 2 minutes, 36 seconds reflecting the strengthening scale and residence of our business. 2:43 2 minutes, 43 seconds We closed the year with revenue of 162.7 cr. 2:48 2 minutes, 48 seconds It is up 18.5% yearonear with an IBITA of 14 48.3 K at a margin of 29.7%. 3:01 3 minutes, 1 second And PAT of 34.3 K. 3:06 3 minutes, 6 seconds This was alongside continued investment in our capabilities, talent and long-term positioning. 3:15 3 minutes, 15 seconds In terms of quarterly performance, Q4 was a strong quarter with revenue of 43.03 K growing 29.1% 3:25 3 minutes, 25 seconds year on year and 1% 1.7% sequentially. 3:32 3 minutes, 32 seconds In fact, what gives us confidence is that Q4 also saw saw conversion of some 3:39 3 minutes, 39 seconds of our strategic wins across large enterprise clients and marketing global brands including 3:48 3 minutes, 48 seconds first a full SAP to UDO migration for a listed Indian infrastructure company in power transmission and green energy. 4:01 4 minutes, 1 second Displacing SAP at a listed client signals are UDO practice is now in enterprise grade. 4:09 4 minutes, 9 seconds Second, a specialist data science talent deployed with a New York based risk and financial [clears throat] crime advisory 4:16 4 minutes, 16 seconds firm working on financial crime detection. 4:21 4 minutes, 21 seconds Third, an ERP implementation for a member form of a top six global accounting network in East Africa. 4:32 4 minutes, 32 seconds These reinforce our positioning, delivery quality and brand credibility even in an 4:40 4 minutes, 40 seconds uncertain environment. Our growth continues to be driven by a diversified 4:47 4 minutes, 47 seconds services mixed across ERP, cloud, data, AI, Salesforce and enterprise transformation 4:56 4 minutes, 56 seconds with 82% of revenue being recurring providing strong visibility and resonance. 5:03 5 minutes, 3 seconds FY26 marked a structural shift in how Queso operate. 5:09 5 minutes, 9 seconds We have repositioned ourselves as an AI first operation where AI is not an overlay but embedded 5:17 5 minutes, 17 seconds into delivery, execution and client engagement. 5:22 5 minutes, 22 seconds What the shift reflects is a genuine capability we have built to enable client through AI 5:31 5 minutes, 31 seconds bringing frameworks, agentic thinking and technical depth that translate into real business outcome for them. 5:41 5 minutes, 41 seconds At Kols, our conviction is simple. Every task whether it is coding, testing, 5:48 5 minutes, 48 seconds operations or communication is executed [clears throat] by AI agents. 5:56 5 minutes, 56 seconds Our engineers review, enhance and raise the bar, not execute. 6:03 6 minutes, 3 seconds We have stabilized ourselves as a 360deree AI transformation partner. 6:10 6 minutes, 10 seconds Whether a client needs software build or operation transform, we bring agents, AI 6:16 6 minutes, 16 seconds agents to both. Agent that code, agent that test, agent that deploy, agent that 6:24 6 minutes, 24 seconds automate workflows, monitor communication and flag risk. 6:30 6 minutes, 30 seconds We know that future is at Quesos that future is already our operating model. 6:38 6 minutes, 38 seconds We are an AI transformation partner and that is distinction shapes everything about how we engage deliver and grow. 6:51 6 minutes, 51 seconds Enterprise AI has moved from experimentation to execution globally. 6:57 6 minutes, 57 seconds KSOL is already on the right side of the shift not by responding to it but by 7:05 7 minutes, 5 seconds enabling it alongside our clients. Now coming to guidance for FY26 7:12 7 minutes, 12 seconds we expect annual revenue growth to be around 18 to 20% and I evita margin to be in the range of 25 to 30%. 7:26 7 minutes, 26 seconds demand remains intact and our execution momentum is strong. We remain confident 7:33 7 minutes, 33 seconds of delivering sustainable growth while continuing to invest for a scale. 7:39 7 minutes, 39 seconds Overall, we believe the business has delivered a strong growth in a challenging environment and the building 7:47 7 minutes, 47 seconds blocks created in FY26 position as well for the next phase of growth. Thank you. 7:54 7 minutes, 54 seconds With this I now hand over the floor to um to share financial highlights. Thank you. 8:02 8 minutes, 2 seconds Thank you. Thank you. Uh just one correction the guidance was for FY27. 8:08 8 minutes, 8 seconds Okay. So and good evening everyone and thank you for joining our Q4 FI26 earnings call. Let me quickly walk you 8:16 8 minutes, 16 seconds through the financial performance for Q4 and full year of financial year 26. So as Ratan mentioned FI26 has been a year 8:24 8 minutes, 24 seconds of strong growth and combined with deliberate investment for us. Our revenue stood at rupees 162.7 cr up by 8:32 8 minutes, 32 seconds 18.4% year one year. Our Ibita was at 43 uh 48.3 cr and ITA margin stood at 29.7% 8:41 8 minutes, 41 seconds in FI26 versus 34% uh 34.8% in FI25. 8:47 8 minutes, 47 seconds This was a conscious and planned investment phase as we communicated in earlier calls. This was primarily driven 8:54 8 minutes, 54 seconds by the soft related cost, investment in senior leadership uh and compensation cost, higher travel and event spend to 9:02 9 minutes, 2 seconds strengthen our global presence and one-time impact for the new labor resolutions amounting to rupees 1.1 cr. 9:10 9 minutes, 10 seconds Importantly, these are strategic and largely non-recurring investments. We exited FI26 at the upper end of the 9:18 9 minutes, 18 seconds range guided that is 29.7% ETA margin which ensures that we reinforce the stability 9:25 9 minutes, 25 seconds profit after tax for FI26 stood at 34.3 cr in line with FI25 despite the 9:32 9 minutes, 32 seconds investments uh made in capability buildout at margin was at 21.1%. 9:39 9 minutes, 39 seconds Our continued efforts have resulted into a strong 5-year revenue CGR of 42% and a healthy 5-year net profit CG of 31%. We 9:49 9 minutes, 49 seconds continue to deliver exceptional return ratios with ROC at 152% and ROE at 137% for the financial year 2526. 10:00 10 minutes For Q4 FI26, we reported a revenue of 43.03 03 cr a growth of 1.7% sequentially and 29.1% 10:09 10 minutes, 9 seconds yearonear the topline growth was driven by consistent execution across ongoing client and core business momentum 10:16 10 minutes, 16 seconds remained healthy our margin for the quarter stood at 29.3% pack for the quarter stood at 9.7 cr uh translating into a pack margin of 22.5%. 10:29 10 minutes, 29 seconds Earning per share for the quarter was rups 4.09 09 per share. We continue to generate strong cash flows and our 10:36 10 minutes, 36 seconds balance sheet uh remains healthy with cash uh balance of 6.9 cr with a net debt status. From a client concentration 10:46 10 minutes, 46 seconds standpoint, our top five and top 10 clients contributed 40% and 54% of our revenues respectively in FI26. Overseas 10:56 10 minutes, 56 seconds market contributed approximately 77% of our revenues underscoring the increasing contribution of global markets. 11:04 11 minutes, 4 seconds As highlighted earlier, IT services remains the core driver of our revenue and profitability. Product segment which is a small contributor continues to be 11:13 11 minutes, 13 seconds developed in a disciplined manner. As we move into FI27, our focus remains clear. 11:20 11 minutes, 20 seconds Deepening the relationship with our existing clients, increasing the share of fixed price and outcome based engagements, leveraging our 360deree AI 11:29 11 minutes, 29 seconds transformation partner positioning, using the AIE productivity to scale delivery, deepen client engagement, and move from technology vendor to 11:37 11 minutes, 37 seconds end-to-end reinvention partner, continued investment in talent capabilities and maintaining margin discipline with operating leverage. With 11:47 11 minutes, 47 seconds this I will now hand over the floor to operator to open this session for Q&A. Thank you everyone. 11:54 11 minutes, 54 seconds Thank you very much sir. We will now begin with the question and answer session. Anyone who wishes to ask a 12:02 12 minutes, 2 seconds question may press star and one on their touchstone telephone. 12:08 12 minutes, 8 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. 12:19 12 minutes, 19 seconds Ladies and gentlemen, we will wait for a moment while the question cube assembles. Thank you. 12:40 12 minutes, 40 seconds We take the first question from the line of Apur from Whit Stone Financial Advisors. Please proceed with your question. 12:48 12 minutes, 48 seconds Yeah, thanks. Thanks for the opportunity. Uh so the question is uh as we have mentioned that we use AI agents 12:56 12 minutes, 56 seconds to code test and operations right. So how much efficiency do we uh do we see in our employee experience with going 13:03 13 minutes, 3 seconds forward with the financial 13:17 13 minutes, 17 seconds s? Yeah, there's some students. Okay, one second. 13:35 13 minutes, 35 seconds Hello. Yes sir. Can you speak again please? 13:40 13 minutes, 40 seconds Yeah. So, so my question is regarding that uh we are using EA agents to code test and in our operations right. So 13:49 13 minutes, 49 seconds then uh so then do we expect uh the efficiency in the employee expense going forward? 13:58 13 minutes, 58 seconds Basically we have not exactly measured okay that what will be the result but what we are 14:07 14 minutes, 7 seconds observing right now that when we are using the agent it is reducing the time and uh it is increasing the output. 14:15 14 minutes, 15 seconds Okay. 14:18 14 minutes, 18 seconds And we are trying to uh create agents for every repetitive task. 14:27 14 minutes, 27 seconds So okay but at this moment I cannot I do not have a exact answer for your 14:34 14 minutes, 34 seconds question that how much it will um affect to costing. 14:44 14 minutes, 44 seconds Got it. 14:45 14 minutes, 45 seconds In terms of show can you please share some examples when we have used AI in our day operations? 14:55 14 minutes, 55 seconds Definitely. 14:56 14 minutes, 56 seconds For example, today we have uh given uh one person from the sales team. They have that person has created a agent on cloud. What he has done? 15:10 15 minutes, 10 seconds He has uh created a agent. that agent is getting data from the Excel sheet and then [clears throat] 15:18 15 minutes, 18 seconds that agent is uh because that agent is tuned and then agent is deciding that which 15:26 15 minutes, 26 seconds email ID uh agent should select to send email for uh cold email. Okay. So we 15:37 15 minutes, 37 seconds have all that salesperson has uploaded the excel sheet and then agent is deciding that which agent sorry which 15:45 15 minutes, 45 seconds email id uh that agent should select to send as a cold email. This is a small 15:52 15 minutes, 52 seconds agent. Okay. Apart of this let me another example. 15:58 15 minutes, 58 seconds uh for example uh how many events are going to be organized in New York in next three 16:06 16 minutes, 6 seconds months. Okay. Now we have uh created a agent and that agent is uh 16:14 16 minutes, 14 seconds searching every day uh at a specific time that how many new events are added 16:22 16 minutes, 22 seconds all around the world and that agent is sending us emails. So this is just a small example that how we are trying to create uh agents for repetitive task. 16:34 16 minutes, 34 seconds Okay. So also we have mentioned yeah sorry I can give you uh very uh highly 16:44 16 minutes, 44 seconds technical example but that I don't think that it is the right time. Okay. I think I have given you answer. 16:52 16 minutes, 52 seconds Okay. Okay sir. S I have one more question. uh so that we have mentioned in our keys that we have onboarded a 17:00 17 minutes specialist data scientist uh so I didn't get it like uh have we uh uh onboarded 17:07 17 minutes, 7 seconds that person as an employer we have given that as an outsourced person to another company see it [clears throat] can just go back 17:16 17 minutes, 16 seconds actually we have onboarded not one we have onboarded many okay 17:23 17 minutes, 23 seconds but not as a employees We have given them our people to research on a 17:29 17 minutes, 29 seconds specific topic uh topic. Okay. So that is not okay. So let me 17:39 17 minutes, 39 seconds let me add an answer to that is so this is for some clients who are uh very strictly regulated because they are uh 17:48 17 minutes, 48 seconds you can say financial uh let's say fraud detection security right all all of those areas. Yes, this is a area where 17:57 17 minutes, 57 seconds uh you know this team has been set up and this has been moving both because uh it's a very you can say a niche and high revenue area. 18:09 18 minutes, 9 seconds Mhm. Okay. 18:10 18 minutes, 10 seconds And not only one we have added multiple resources for that customer. 18:18 18 minutes, 18 seconds Okay. Thank you. So that's it for my idea. Thank you. 18:26 18 minutes, 26 seconds We take the next question from the line of Tashil Zaviri from Crown Capital. Please go ahead. 18:33 18 minutes, 33 seconds Hello. Uh good evening. Thank you so much for taking my question. Uh firstly, congratulations on a great course for 18:39 18 minutes, 39 seconds sir. Uh so just wanted to ask with regards to our margin right here. So the 18:47 18 minutes, 47 seconds trajectory actually what we've been seeing that is that our revenue has been steadily growing but our margin has been 18:54 18 minutes, 54 seconds declining due to which our path has been near identical in the last three years. 19:00 19 minutes So in terms of bottom line growth how do we grow? 19:06 19 minutes, 6 seconds Okay you can answer this. Yes you can. So uh basically if you see we have made quite 19:15 19 minutes, 15 seconds few investments this year which we already communicated and we have been communicated from the Q1 of 26. Okay. 19:23 19 minutes, 23 seconds Because earlier there were no eox there were no events being attended there was no uh any expenses there on landing and 19:32 19 minutes, 32 seconds we have also invested few amounts in DSM as well. So all this uh in spite of all this you have entered on the upper uh range of the diet margin. 19:43 19 minutes, 43 seconds Okay. So if you compare from last year Q4 this year Q4 has been quite significant and uh we expect it to be in the same range going forward as well. 19:55 19 minutes, 55 seconds Okay. Okay. So basically so I wanted to know that like even though the guidance 20:01 20 minutes, 1 second is given of 25 to 50% we should ideally have it on the higher range right because of AI also we'll get some 20:09 20 minutes, 9 seconds efficiency I'm assuming that some marketing cost that we had done this year it would uh be more of the one time 20:17 20 minutes, 17 seconds in nature or is it more recurring because just wanted to like understand because we've performed really well in a very difficult condition but our margins 20:25 20 minutes, 25 seconds are we can absor So is that like is it because also because of a threat of AI coming in we have to also do some price cutting. How do you see that? 20:35 20 minutes, 35 seconds So it's not recording I would say few expenses would be there but uh at not a great scale that were done in FI26. So 20:42 20 minutes, 42 seconds there would be some benefits from these investments as well. And on AI side we are seeing efficiency internally and due 20:50 20 minutes, 50 seconds to the current situation global situation there are few uh delays you can say but the conversions are going strong and demand is healthy. 21:01 21 minutes, 1 second So okay and just with regards to like when you're saying de getting delay store uh like do we have like a rough 21:09 21 minutes, 9 seconds you know order pipeline that we have and like what kind of order bookings can we expect like deals we can expect in FI7 21:20 21 minutes, 20 seconds we have already given the uh I think guidance range for the revenues 21:26 21 minutes, 26 seconds yeah uh okay fair enough that's it for thank Thank you. We take the next question 21:35 21 minutes, 35 seconds from the line of Kostona from BMSPL Capital. Please proceed. 21:41 21 minutes, 41 seconds Yeah. Hi. Uh good afternoon. This is Sha on behalf of Costa. Uh how much uh percentage of your total business or 21:49 21 minutes, 49 seconds your total revenue is currently AI first? 21:56 21 minutes, 56 seconds So uh first of all AI is not a standalone revenue factor. It's embedded into all the technologies. 22:06 22 minutes, 6 seconds Okay. So all the services we are delivering they are embedded. 22:14 22 minutes, 14 seconds Okay. Um and how is the DSM business scaling and where are we at currently versus where would we like to be? 22:26 22 minutes, 26 seconds So on DFM uh we would like to discuss it more on a later stage when the products revenue become a marginal revenue. As 22:35 22 minutes, 35 seconds earlier communicated we are uh more focusing on IT services because that's the main bread and butter of our uh business. 22:44 22 minutes, 44 seconds So we are scaling product business in a very disciplined manner but our main focus is completely on IT services. 22:53 22 minutes, 53 seconds Um okay okay thank you. Thank you. 23:01 23 minutes, 1 second Before we take the next question a reminder to all the participants. Anyone who wishes to join the question queue may press star and one on the touchstone telephone. 23:11 23 minutes, 11 seconds Participant if you wish to join the question queue you may press star and one on your touchstone telephone 23:18 23 minutes, 18 seconds we take the next question from the line of Jan Sharma individual investor please go ahead. 23:25 23 minutes, 25 seconds Yeah. Hi Ra, good evening. Uh, I just have one question right because we have been talking in past few meetings 23:33 23 minutes, 33 seconds regards to DTF. So I just want to understand that product that what was overall expenses that uh the company has 23:42 23 minutes, 42 seconds done for the product development of DF in the last year and what it is planned in the current year 27. 23:53 23 minutes, 53 seconds All right. So Jin on DFM development if you say approx uh if you want to quantify it then you can consider appro 24:02 24 minutes, 2 seconds 2 crores was expensed in FI26 and we expect no further uh big investments on DSM development in FI27. 24:14 24 minutes, 14 seconds Okay. So can you hear now? 24:19 24 minutes, 19 seconds Yes. One thing I would like to add here that we are not going to spend money on 24:25 24 minutes, 25 seconds TFM. Okay, TFM development is done. We will wait for the customers 24:32 24 minutes, 32 seconds and on the event side uh the expenses we have done last year 24:41 24 minutes, 41 seconds it will reduce up by 60% at least. Okay. 24:48 24 minutes, 48 seconds This year we have attended many events last year for DFM and we have spent huge money for the DFM on the development side as well as on the marketing side. 24:59 24 minutes, 59 seconds This year we will focus only and only on the services. Okay. 25:07 25 minutes, 7 seconds And for the DSM we will wait for the customers and if we will get the customers if we will convert then we 25:14 25 minutes, 14 seconds will think about the next step. For now, for now and for the next few quarters, we will focus only on the services. 25:22 25 minutes, 22 seconds We will not spend money on the product side because last year we have spent money on 25:29 25 minutes, 29 seconds the product side but unfortunately we could not generate uh revenue for that. Okay. So you can 25:38 25 minutes, 38 seconds say that from the services we have uh we have taken the money from the services and we 25:46 25 minutes, 46 seconds have spent money for the product and that's why you can see uh the growth bad 25:52 25 minutes, 52 seconds growth is u you can see there's a very low pat growth as compared to last year but 26:00 26 minutes this year we will focus only on the services not on the product and not for 26:07 26 minutes, 7 seconds the uh expenses related to product like events and all. I hope I have given the answer. 26:15 26 minutes, 15 seconds Yeah. Right. Thank you. Thank you. Thank you sir. 26:23 26 minutes, 23 seconds A reminder to the participants if you wish to join the question queue you may press star and one on your touchstone telephone. Ladies and gentlemen, if you 26:32 26 minutes, 32 seconds wish to join the question queue, you may press star and one on your touchstone. 26:38 26 minutes, 38 seconds The next question is from the line of Pra Akaral, an individual investor. Please proceed with your question. 26:46 26 minutes, 46 seconds Uh hi sir, am I audible? Yes. 26:52 26 minutes, 52 seconds Hello. My question is along the lines of rupee depreciation that we have seen. So considering 60% of our revenue comes from North America region. So in the Q4 27:00 27 minutes FI26 do we see the benefit of rupee depreciation in the pack margin or do we expect that to see that in coming quarters? 27:09 27 minutes, 9 seconds No, we have in fact seen uh tailwind of this FX tailwind. So we have benefited 27:16 27 minutes, 16 seconds uh not at a large scale but yeah somewhere uh to quantify it I would say 27:24 27 minutes, 24 seconds this uh somewhere lies in between you can say approx 20 lakhs. So that was 27:33 27 minutes, 33 seconds FX gain you can consider from the rupee delir. 27:39 27 minutes, 39 seconds Do we expect any a further margin improvement from this level on account of any effect? 27:46 27 minutes, 46 seconds I think it will remain because now the balance will happen at a higher rate. 27:51 27 minutes, 51 seconds This is a continuous process but yeah we are focusing on margins as well. 27:58 27 minutes, 58 seconds Got it. Understood, sir. Thank you. 28:02 28 minutes, 2 seconds Thank you. A reminder to all the participants, you may press star in one to ask a question. 28:10 28 minutes, 10 seconds The next question is from the line of cost from BMSPL Capital. Please go ahead. 28:17 28 minutes, 17 seconds Yeah. Hi Dan. Hi. 28:20 28 minutes, 20 seconds Yeah. Yeah. Hi. So again I just wanted to further ask on the DFM product because you know in a lot of calls 28:28 28 minutes, 28 seconds before you all always spoke about it and now you don't. So so so I really wanted to understand did were was our 28:37 28 minutes, 37 seconds expectations for this product much more than the current re reality of customer 28:45 28 minutes, 45 seconds acceptance or do we still have hope for this product in the future? 28:51 28 minutes, 51 seconds See uh you are correct expectation was more okay and that we could not 28:59 28 minutes, 59 seconds [cough] 29:00 29 minutes achieve till now. Being an entrepreneur, it is my job to try multiple things, multiple approach to increase the 29:09 29 minutes, 9 seconds business. And that was you can say my trial to uh develop a product a part of the regular services. 29:20 29 minutes, 20 seconds I sold it to two customer also. two three customers are in pipeline but due 29:26 29 minutes, 26 seconds to geograph geographical problems uh they have shifted it to June July but 29:35 29 minutes, 35 seconds still I do not see lot of honestly speaking I do not see lot of opportunities with in DFM so that's why 29:45 29 minutes, 45 seconds I have decided whatever happened it happened now let's focus on services which is our bread butter if you will 29:52 29 minutes, 52 seconds see separately services and product. Then you will see that our data is amazing. Okay, we have 29:59 29 minutes, 59 seconds taken money from the services. We have spent money on the DSM. But now we will focus only on the services. We are doing 30:07 30 minutes, 7 seconds good. We have a good pipeline. We have already given you the guidelines and we have adopted the AI. Everyone is CL 30:16 30 minutes, 16 seconds certified. Now in the case of I do not see that any other company has everyone 30:25 30 minutes, 25 seconds certified by the cloud and we are heavily using AI and all those things. 30:31 30 minutes, 31 seconds So I'm hoping a good I'm uh seeing that good future of Kols. 30:40 30 minutes, 40 seconds Okay. And just lastly on the margin front gratan uh I mean why why as a company policy 30:48 30 minutes, 48 seconds right why as in when you all give guidance I want to understand the logic why you are guiding for such a broad 30:57 30 minutes, 57 seconds range of margin you know 25 to 30% because I mean it the reality of your bottom line will be very different if 31:05 31 minutes, 5 seconds you have 25% ITA or 30% IATA so Why such a broad range? 31:14 31 minutes, 14 seconds As you can see the past we have been uh always around 30% plus minus something 31:22 31 minutes, 22 seconds but you can see that every day you are getting new news on the internet. Okay. 31:29 31 minutes, 29 seconds So we don't know that what will be the news tomorrow. Okay. So considering 31:37 31 minutes, 37 seconds those geo political means okay I'm trying to be conservative and that's why 31:44 31 minutes, 44 seconds I have given you the bracket but if everything goes well all around the world then it will be a good number 31:53 31 minutes, 53 seconds okay great and you have some cash on your books will you continue paying dividend or are you looking at some 32:01 32 minutes, 1 second acquisitions these will continue giving the dividend we tried for acquisition but 32:09 32 minutes, 9 seconds unfortunately we could not find good company so we dropped that idea and now I'm focusing completely on the business 32:17 32 minutes, 17 seconds okay because that if you will go for acquisition then you will have to spend 32:23 32 minutes, 23 seconds lot of time also okay so I found that uh I should spend time right now on the 32:32 32 minutes, 32 seconds services and for the next Here I have a good plan. We are focusing on multiple 32:39 32 minutes, 39 seconds advanced technologies with the help of AI. We are offering our customer complete 360deree AI transformation. 32:49 32 minutes, 49 seconds uh we uh as a partner AI transformation partner till now we were doing just development but now we are saying that 32:57 32 minutes, 57 seconds we will do the development with the help of AI and then we will help you to cut your operation cost by creating 33:05 33 minutes, 5 seconds developing agents for you to complete AI AI for development then AI for operations 33:14 33 minutes, 14 seconds understood understood okay great thank you so Thank you. 33:21 33 minutes, 21 seconds Thank you. The next question is from the line of sajes from RK Capital. Please proceed with your question. 33:30 33 minutes, 30 seconds Hi. Uh thanks for the opportunity sir. I saw in your investor presentation that you have become a certified partner uh 33:37 33 minutes, 37 seconds ERP next partner right? So uh how good is the opportunity in ERP net uh compared to Udu? 33:44 33 minutes, 44 seconds See uh would you like to answer or I should answer? 33:50 33 minutes, 50 seconds Uh sir I can answer. Dan said I Okay, you can answer. It's fine. 33:55 33 minutes, 55 seconds Yes. So uh uh see the situation is not around comparing these two ERPs. We wanted to initiate our ERP practice. So 34:03 34 minutes, 3 seconds earlier what was happening whenever every any customer was coming to us, we were only ready with our UDU offering. 34:10 34 minutes, 10 seconds uh and we wanted to diversify in a manner that okay if any specific person is coming um they do they both have 34:17 34 minutes, 17 seconds their own differentiations they both have their own feature UDO is an open source thing which is drive driven by an 34:23 34 minutes, 23 seconds uh specific framework uh ERP next is a frappe partnered uh management system uh having its own uh 171 18 connected apps 34:33 34 minutes, 33 seconds so both have their own market both have their own um uh costing aspects also to initiate our own ERP business, our own 34:41 34 minutes, 41 seconds ERP dimension, we added ERP or frappe partnership also. So uh so that if any specific customer is uh getting 34:50 34 minutes, 50 seconds onboarded, we can offer two ranges of ERPs instead of specifically focusing on UDU. That was the intent. 34:57 34 minutes, 57 seconds Sir uh what is the installed customer base of uh at least can you give some metrics uh at the product level uh the 35:04 35 minutes, 4 seconds installed customer base of ERP next uh versus UDU in India and globally 35:11 35 minutes, 11 seconds uh to specifically or to go with a very detailed thought we'll share it with you because that is uh uh right now may not 35:19 35 minutes, 19 seconds be available but uh um like to be very figurative or very clear we'll share this information with 35:27 35 minutes, 27 seconds Okay. Uh uh uh how will I get that information? Your your team will reach out. 35:32 35 minutes, 32 seconds Yes. Yes. Our IR team will reach out. As we can reach out, right? 35:37 35 minutes, 37 seconds Okay. Uh and so uh like going forward like will your dividend payout continue to be in the range of 40 to 60% of your 35:45 35 minutes, 45 seconds profits? Like uh uh what is your dividend payout policy going forward? 35:51 35 minutes, 51 seconds It will continue in the same manner as uh we are not looking for any acquisitions or inorganic growth currently in the coming quarters. So it 36:01 36 minutes, 1 second will continue the same way. Okay. So we can expect 40 to 60% of the profits being paid out. Yes. Okay. And sir I joined a bit late. 36:10 36 minutes, 10 seconds If you can just you know re uh reiterate uh in case you have already um uh called it out uh your revenue growth which you 36:17 36 minutes, 17 seconds expect for uh FI27 because you are going to focus only on services is what I heard. So so how much revenue growth uh are you expecting? 36:26 36 minutes, 26 seconds So for FI27 we are expecting annual revenue growth of around 18 to 20%. 36:35 36 minutes, 35 seconds Okay. Uh so so this is some some moderation in your in your growth range is it uh because I think in the past you've been growing at a very uh high 36:43 36 minutes, 43 seconds pace uh uh so um uh do you see like uh if you can just explain a bit more now 36:52 36 minutes, 52 seconds base is large right when we have started the company when we launched the IPO that 37:01 37 minutes, 1 second time the overall revenue was 10 cr Okay, quarterly 2.5 cr. So adding 25 37:10 37 minutes, 10 seconds lakh in a quarter was a joke you can say at that time. Now if you 37:16 37 minutes, 16 seconds compare current situation okay at now right now the current base is 40 42 43.2 37:26 37 minutes, 26 seconds and now for 10% suppose you need to add 4.3 it is not a small number. So that's why 37:35 37 minutes, 35 seconds if you see the absolute number is in increasing but percent is decreasing. 37:40 37 minutes, 40 seconds [clears throat] 37:42 37 minutes, 42 seconds Okay. Okay sir. Okay that's it. Thank you. 37:50 37 minutes, 50 seconds We take the next question from the line of Apur from whitest stone financial advisor. Please go ahead. 37:56 37 minutes, 56 seconds Yeah. Yeah. Thank you sir. So I just have two more questions. So uh the first question is on you mentioned that we have migrated a client from SAP to UDU. 38:07 38 minutes, 7 seconds So I want to understand what would have been the reason for the migration for the client to move to UDU. 38:16 38 minutes, 16 seconds Multiple customers are trying to reduce their cost. Okay. and they are trying to 38:24 38 minutes, 24 seconds move to less costly uh solutions. 38:30 38 minutes, 30 seconds So UDO and SAP both are uh doing mostly the same both are providing mostly same feature. Okay. 38:41 38 minutes, 41 seconds And you know that SAP is super costly as compared to UDO. So that's why not only 38:48 38 minutes, 48 seconds this customer, we have other customers also. uh three days before I have I had a call with the one customer from the 38:55 38 minutes, 55 seconds Tanzania. They also want move from SAP to UDU. Okay. 39:03 39 minutes, 3 seconds Okay. 39:04 39 minutes, 4 seconds I hope I Yeah. Yes sir. And my second question is uh sir are you see seeing any delays in 39:11 39 minutes, 11 seconds order or uh because of the uh this ongoing war? 39:17 39 minutes, 17 seconds Yeah, definitely. Uh actually, you know, but uh uh UAE, we have a we have a good 39:25 39 minutes, 25 seconds business in UAE. Okay. But we had few customers and they were about to release 39:33 39 minutes, 33 seconds the order in the Okay. But they could not and that's why uh you can see that 39:41 39 minutes, 41 seconds uh I can say that if they would have done it then for this quarter the growth 39:48 39 minutes, 48 seconds uh we could see that more than 1.7%. 39:53 39 minutes, 53 seconds Right now we are seeing only 1.7% quarter on quarter. 39:58 39 minutes, 58 seconds This is because that because of that war. Okay. But now things are good. They are releasing the order. They are 40:08 40 minutes, 8 seconds releasing the PO and all. And we can see the bright future at this moment. So 40:14 40 minutes, 14 seconds that's why we are very optimistic for uh 18 to 20% growth and margin considering 40:21 40 minutes, 21 seconds the current situation. If whatever what will happen tomorrow I don't know you know what I'm trying to indicate. 40:30 40 minutes, 30 seconds Yeah. Okay. Thank you. 40:38 40 minutes, 38 seconds Thank you. Before we take the next question a reminder to all the participants if you wish to ask a question you may press star and one on 40:48 40 minutes, 48 seconds your touchstone telephone. Ladies and gentlemen, if you wish to ask a question, please press start and one on 40:55 40 minutes, 55 seconds your touchstone phone. The next question is from the line of Rajes from RK Capital. Please proceed, sir. 41:02 41 minutes, 2 seconds Yeah, thanks for the followup. Uh sir, since you mentioned you are not going to have uh product related expenses and event related expenses in FI27. Uh but 41:11 41 minutes, 11 seconds at the same time, the margin band is a is a wide range of 25 to 30%. uh can we expect pad growth to be uh at least you 41:19 41 minutes, 19 seconds know higher than your revenue growth or or is it uncertain at this point? 41:26 41 minutes, 26 seconds Will you answer? Yes, definitely. So uh see there are lot of things attached to margin because we are investing heavily 41:35 41 minutes, 35 seconds in AI as well and uh we are investing in insuranceances, security, IT security. 41:41 41 minutes, 41 seconds So few expenses are attached to it as we are doing and that's why that range has been kept to 25 to 30%. But overall our 41:50 41 minutes, 50 seconds aspiration is to end on the higher side of it. 41:54 41 minutes, 54 seconds See one thing, one thing I would like to again tell here that 25 to 30 is something that we would be able to manage. 42:08 42 minutes, 8 seconds Okay. Easily if everything goes well then you can see better number. But I'm try I would we 42:15 42 minutes, 15 seconds are trying to be conservative so that in future if anything goes wrong then nobody should say that okay we have 42:23 42 minutes, 23 seconds given a high number and then this happens. So that's why we are saying that 25 to 13 is doable easily. 42:34 42 minutes, 34 seconds Okay. Okay sir. Thank you. 42:39 42 minutes, 39 seconds Thank you participants. If you wish to ask a question, you may press star and one on your touchstone phone. 43:00 43 minutes As there are no further questions, I would now like to hand the conference over to the management for closing comments. 43:08 43 minutes, 8 seconds Thank you everyone for joining the conference call this call call. Okay. I would like to conclude here that uh we 43:17 43 minutes, 17 seconds are now AI first company and we are 43:24 43 minutes, 24 seconds trying to uh build our image as a AI transformation partner for our customer 43:31 43 minutes, 31 seconds who is providing end to end means development to operation 43:37 43 minutes, 37 seconds operational cut um uh cost uh means reducing the development cost 43:45 43 minutes, 45 seconds and reducing the uh reducing the operational cost by AI and we it is not something that we have not tried it we 43:55 43 minutes, 55 seconds have tried and for multiple customers we have already done if you will see the commentary 44:02 44 minutes, 2 seconds uh we are already using AI for at least 60 70% customers and we have increased their output 44:11 44 minutes, 11 seconds with the same amount of the amount with the same number of the resources 44:18 44 minutes, 18 seconds and once again thank you everyone for joining the call. 44:24 44 minutes, 24 seconds Thank you. 44:28 44 minutes, 28 seconds Thank you sir. On behalf of K South India Limited that concludes this conference. Thank you for joining us and 44:36 44 minutes, 36 seconds you may now disconnect your lines. Thank you.