Rationale

• The company delivered strong financial performance with Q2 FY24 revenue growing 17% YoY to INR 621 Crs and H1 FY24 revenue growing 18% YoY, consistently crossing the INR 600 Crs mark for three quarters.
• Profitability expanded significantly, with Q2 FY24 EBITDA growing 45% YoY and H1 FY24 PAT growing 43% YoY, indicating strong operational leverage.

Rationale

• Sustained strong financial performance: The company achieved a consistent 20% CAGR for LTM revenue, LTM license-linked revenue, and EBITDA over the last three years, demonstrating predictable and sustainable growth. LTM revenue grew 19% YoY, and the higher-margin license-linked revenue grew 23% YoY.
• Significant underlying business acceleration: Q4 revenue is expected to be similar to Q3 (Rs.635 Crs) despite a $2.5M (Rs.20 Crs) revenue shortfall from the GeM contract in Q3 and its full exit in Q4. Management confirmed this implies a sequential growth of 18-20% for the core business (excluding GeM).

Rationale

• LTM EBITDA grew 27% YoY (excluding GeM), significantly outpacing LTM revenue growth of 14% YoY (excluding GeM), indicating robust margin expansion.
• The company maintains a healthy cash position with FY24 cash collections exceeding Rs. 2,300 Crs and a strong cash balance of Rs. 776 Crs as of March 31, 2024; Q4 Days Sales Outstanding (DSO) improved to less than 100 days (excluding GeM).

Rationale

• Revenue for Q1 FY25 was Rs. 605 Crs, representing a ~3.7% YoY decline from an estimated Rs. 628 Crs in Q1 FY24 (calculated based on LTM figures).
• Last Twelve Months (LTM) revenue showed an absolute contraction, decreasing from Rs. 2341 Crs (Q4 FY24 LTM) to Rs. 2318 Crs (Q1 FY25 LTM), indicating a deteriorating underlying growth trend.

Rationale

• Q2 FY25 total revenue declined sequentially to INR 556 crores from an implied Q1 FY25 revenue of INR 605 crores (calculated from H1 FY25 total revenue of 1161 crores).
• EBITDA margin significantly compressed to 14% in Q2 FY25, a substantial decline of 600 basis points from the Last 12 Months (LTM) EBITDA margin of 20%.

Rationale

• Company reported zero debt and INR 804 crore cash in hand, demonstrating strong financial resilience and enabling strategic investments.
• The acquisition of Central 1 Credit Union's digital banking operations will add INR 200 crore to ARR and bring 160 new customers, significantly strengthening North American presence and recurring revenue base.

Rationale

• Revenue growth of 19% YoY in Q4 FY25 and 11-12% YoY for FY25 demonstrates healthy top-line expansion, with management targeting 15% growth and aiming to cross ₹800 Cr quarterly run-rate.
• License-linked revenue (AMC, cloud, SaaS) at 50% of FY25 revenue and ₹870 Cr ARR run-rate for Q4 FY25 indicate increasing recurring and predictable revenue streams, a key indicator of platform stickiness and business maturation.

Rationale

• Strong YoY revenue growth of 18% (₹734 Cr) and EBITDA growth of 28% (₹176 Cr), coupled with a 27% YoY increase in Profit After Tax (₹94 Cr), indicates robust financial performance.
• License-linked revenues (LLR) now exceed 50% of total revenue at ₹389 Cr, and Annual Recurring Revenue (ARR) stands at ₹1,041 Cr, demonstrating a positive shift towards a predictable, recurring revenue model.

Rationale

• Revenue grew 34% YoY to ₹789 crore, and 7% sequentially. For H1 FY26, revenue grew 26% YoY to ₹1,523 crore.
• EBITDA grew 68% YoY to ₹184 crore in Q2, and 46% YoY to ₹360 crore in H1 FY26. Net profit nearly doubled (94% YoY) to ₹102 crore in Q2 and grew 55% YoY to ₹197 crore in H1 FY26.