Q1 2027 Protean eGov Technologies Ltd Earnings Call

August 4, 2026

Speaker #4: Good day, and welcome to Protean.

Operator: Good day, welcome to Protean eGov Technologies Q1 FY27 earnings conference call hosted by Go India Advisors. As a reminder, all participant lines will be in the listen-only mode, there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Pushpa Mani, Head Investor Relations, Protean eGov Technologies. Thank you, over to you, ma'am.

Speaker #1: eGovernance Technologies Q1 FY27 earnings conference call, hosted by GoIndia Advisors. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #1: Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Ms. Pushpa Mani, Head of Investor Relations, Protean eGovernance Technologies. Thank you, and over to you, ma'am.

Speaker #5: Thanks, Saniya. Good evening, everyone. I welcome you all to the Q1 FY27 results discussion. You must have received the results press release and the investor presentation of the company, which are available on BSE, NSE, as well as on the company's website.

Pushpa Mani: Thanks, Tania. Good evening, everyone. I welcome you all to the Q1 FY27 results discussion. You must have received the results, press release, and the investor presentation of the company, which is available on BSE, NSE, as well as on the company's website. As usual, we will start the forum with the opening remarks by our MD & CEO, followed by CFO, then we will open the floor for the question and answer session. If any of your questions remain unanswered, you may reach out to us afterwards. The management on today's call will be represented by Mr. Ajay Rajan, Managing Director and CEO; Mr. V. Easwaran, Whole Time Director and COO; Mr. Rakesh Doshi, Chief Business Officer; Mr. Sandeep Mantri, Chief Financial Officer; myself, Head Investor Relations.

Speaker #5: As usual, we will start the forum with the opening remarks by our MD and CEO, followed by the CFO, and then we will open the floor for the question and answer session.

Speaker #5: If any of your questions remain unanswered, you may reach out to us afterwards. The management on today's call will be represented by Mr. Ajay Rajat, Managing Director and CEO, and Mr. V.

Speaker #5: Eshwaran, Whole-time Director and COO; Mr. Rakesh Doshi, Chief Business Officer; Mr. Sandeep Mantri, Chief Financial Officer; and myself, Head of Investor Relations. Before we begin, I would like to mention that some of the statements in today's discussion may be forward-looking in nature, and we believe that the expectations contained in these statements are reasonable.

Pushpa Mani: Before we begin, I would like to mention that some of the statements in today's discussion may be forward-looking in nature, we believe that the expectations contained in these statements are reasonable. However, these statements involve a number of risks and uncertainties that may lead to different results. With this, I invite our Managing Director, Mr. Ajay Rajan. Thank you, over to you, sir.

Speaker #5: However, these statements involve a number of risks and uncertainties that may lead to different results. With this, I invite our Managing Director, Mr. Ajay Rajan.

Speaker #5: Thank you, and over to you, sir.

Speaker #6: Thank you, Pushpa. Good evening, everyone, and thank you for joining us for our Q1 FY27 earnings call. Just two months into the organization, it's a privilege for me to be here in my first interaction with you as the MD and CEO of Protean.

Ajay Rajan: Thank you, Pushpa. Good evening, everyone, and thank you for joining us for our Q1 FY27 earnings call. Within two months into the organization, it's a privilege for me to be here in the first interaction with you as the MD & CEO of Protean. For those who don't know me, I have spent over three decades in banking, between 21+ years with Deutsche Bank, a large global bank, and close to 9 years in Yes Bank, one of India's most digital-savvy bank. Most of my experience has been spent building and scaling businesses, and at one point, as you're all aware, rebuilding one. I have been part of the management team that helped ride Yes Bank through the 2020 crisis, rebuilding the franchise, and most importantly, rebuilding the trust with customers, regulators, and investors.

Speaker #6: For those who don't know me, I have spent over three decades in banking—over 21 years with Deutsche Bank, a large global bank, and close to nine years at Yes Bank, one of India's most digitally savvy banks.

Speaker #6: Most of my experience has been spent building and scaling businesses and, at one point—as you're all aware—rebuilding one. I have been part of the management team that helped guide Yes Bank through the 2020 crisis, rebuilding the franchise and, most importantly, rebuilding trust with customers, regulators, and investors.

Speaker #6: That experience taught me two things that are directly relevant to the role I took over at Protean. First, that institutions are ultimately valued for the trust they hold; and second, that an innovative mindset, with the right product solutioning, disciplined execution, sharp capital allocation, and relentless focus on profitability, is what helps build a strong franchise.

Ajay Rajan: That experience taught me two things that are directly relevant to the role I took over at Protean. First, that institutions are ultimately valued for the trust they hold, and second, that innovative mindset with the right product solutioning, disciplined execution, sharp capital allocation, and relentless focus on profitability is what helps build a strong franchise. Few organizations have had the privilege of contributing to platforms that touch the lives of millions of citizens while simultaneously supporting economic growth and institutional transformation. For over 3 decades, Protean has been that quiet custodian of India's digital trust, having built digital public infrastructure at population scale for the country and now taken steps towards globalizing these capabilities in line with India's vision of becoming a global exporter of DPI. To put some tangibility in this statement, let me share some numbers.

Speaker #6: Few organizations have had the privilege of contributing to platforms that touch the lives of millions of citizens, while simultaneously supporting economic growth and institutional transformation.

Speaker #6: For over three decades, Protean has been that quiet custodian of India's digital trust, having built digital public infrastructure at population scale for the country, and now taken steps toward globalizing these capabilities in line with India's vision of becoming a global exporter of DPI.

Speaker #6: To put some tangibility to this statement, let me share some numbers. Protean has issued more than 580 million PAN cards to date, opened more than 90 million pension accounts across NPS and Atal Pension Yojana, completed over 15 billion online PAN validations, 2.5 billion eKYC transactions, 4 billion Aadhaar authentications, and 700 million e-signs to date.

Ajay Rajan: Protean has issued more than 58 crore PAN cards till date, opened more than 9 crore pension accounts across NPS and Atal Pension Yojana, completed over 1,500 crore online PAN validations, 250 crore eKYC transactions, 400 crore Aadhaar authentications, and 70 crore eSigns till date. This proves that the real infrastructure is not always the servers or the APIs. It is the trust earned transaction by transaction, and that trust is Protean's moat, which we have earned over 30 years. Coming to the agenda of this call, I would like to use this opportunity to not only share the Q1 financial update, but given that it's my first investor call, I'm sure all of you would like to hear from me about the future we intend to create.

Speaker #6: This proves that the real infrastructure is not always the servers or the APIs; it is the trust earned, transaction by transaction. That trust is Protean's moat, which we have earned over 30 years.

Speaker #6: Coming to the agenda of this call, I would like to use this opportunity to not only share the Q1 financial update, but, given that it's my first investor call, I'm sure all of you would like to hear from me about the future we intend to create.

Speaker #6: Protean possesses something truly special: a talented and committed team, with deep institutional knowledge and a legacy of building innovative, population-scale DPI over three decades.

Ajay Rajan: Protean possesses something truly special, talented and a committed team with deep institutional knowledge and a legacy of building innovative population-scale DPI over 3 decades. At the same time, I also see that the organization at an important inflection point. The opportunities before us are immense, but so are the expectations of our customers, regulators, shareholders, and the ecosystem partners. The next phase of our journey will require us to combine our legacy strengths with newer ideas, sharper and more agile execution, stakeholder centricity, and a focus on outcomes. Let me start with sharing with you some immediate strategic priorities that I've set for myself. First is deepening the core franchise with sharpened execution. We are continuously reviewing our portfolio and will allocate capital and bandwidth towards businesses where returns are the strongest.

Speaker #6: At the same time, I also see that the organization is at an important inflection point. The opportunities before us are immense, but so are the expectations of our customers, regulators, shareholders, and ecosystem partners.

Speaker #6: So, the next phase of our journey will require us to combine our legacy strengths with newer ideas, sharper and more agile execution, stakeholder centricity, and a focus on outcomes.

Speaker #6: Let me start by sharing with you some immediate strategic priorities that I have set for myself. The first is deepening the core franchise with sharpened execution.

Speaker #6: We are continuously reviewing our portfolio, and we will allocate capital and bandwidth towards businesses where returns are the strongest. Our focus will be on high-margin businesses and product profitability by building adjacencies around our core strength, which is the DPI.

Ajay Rajan: Our focus will be on high-margin businesses and product profitability by building adjacencies around our core strength, which is the DPI. Second, we are closely relooking at our cost structures and using AI to drive efficiency across the organization, while also embedding AI into making our product solutioning more intelligent and intuitive. Third, we are sharpening our approach towards international expansion in a very focused partnership-led model in a defined set of geographies with sharply identified solutions. In order to do all this, we will also pursue inorganic growth opportunities that create long-term strategic value, strengthen our capabilities, and contribute meaningfully to our top line, but more importantly, our bottom line. The earlier chapter of India's DPI story was about building the foundational rails. We saw solutions around identity, payments, data, and as you're aware, Protean helped build several of them.

Speaker #6: Second, we are closely relooking at our cost structures and using AI to drive efficiency across the organization, while also embedding AI to make our product solutioning more intelligent and intuitive.

Speaker #6: Third, we are sharpening our approach towards international expansion in a very focused, partnership-led model, in a defined set of geographies with sharply identified solutions.

Speaker #6: In order to do all this, we will also pursue inorganic growth opportunities that create long-term strategic value, strengthen our capabilities, and contribute meaningfully to our top line, but more importantly, our bottom line.

Speaker #6: The earlier chapter of India's DPI story was about building the foundational rails. We saw solutions around identity, payments, and data, and as you're aware, Protean helped build several of them.

Speaker #6: The country is now entering into its second chapter, which is all about value-added sectoral services and AI-driven intelligence that ride on these rails. And I'm deliberately putting thrust on AI here, since DPI and AI together can create something which is profoundly different.

Ajay Rajan: The country is now entering into the second chapter, which is all about value-added sectoral services and AI-driven intelligence that ride on these rails. I'm putting deliberately trust on AI here, since DPI and AI can create together something which is profoundly different. A living public infrastructure that is predictive, personalized, preventive, and more importantly, citizen first. AI can enable services to find citizens based on their preference and consent instead of today's citizens having to search and wait for services to be rendered. That is the future that Protean is building and will continue to want to build. I'll now spend some time on our Q1 FY27 performance before I get into the details of the near-term, medium-term, and long-term strategy for Protean, because that, I'm sure, is something that each one of you would like to hear, given this is the first call.

Speaker #6: A living public infrastructure that is predictive, personalized, preventive, and, more importantly, citizen-first. AI can enable services to find citizens based on their preferences and consent, instead of today's citizens having to search and wait for services to be rendered.

Speaker #6: That is the future that Protean is building, and we will continue to want to build. I will now spend some time on our Q1 FY27 performance.

Speaker #6: Before I get into the details of the near-term, medium-term, and long-term strategy for Protean—because that, I'm sure, is something that each one of you would like to hear, given this is the first call—

Speaker #6: So, in Q1, we followed a very strong Q4, but Q1 has been a mixed quarter for Protean. We reported a resilient and steady operating performance in terms of revenue from operations, which grew 19% year over year to ₹251 crore.

Ajay Rajan: On Q1, we followed on a very strong Q4, Q1 has been a mixed quarter for Protean. We reported a resilient and steady operating performance in terms of revenue from operations, which grew 19% year on year to INR 251 crores. EBITDA stood at INR 28 crores in Q1 compared to INR 45 crores in similar quarter in FY26. This reflects a decline of 38% year on year and an EBITDA margin of 10%. The margin for this quarter was primarily impacted by some upfront investments worth around INR 10 crores, which we incurred towards the implementation of some of our prestigious RFP-led mandates. In addition, we also saw the margins getting affected by cost inflation driven by ongoing geopolitical tensions, which resulted in higher procurement costs for technology hardware, bought-in goods, and the key inputs required for some of these projects.

Speaker #6: EBITDA stood at ₹28 crore in Q1 compared to ₹45 crore in the same quarter in FY26. This reflects a decline of 38% year-on-year.

Speaker #6: And EBITDA margin of 10%. The margin for this quarter was primarily impacted by some upfront investments, worth several crores, which we incurred towards implementation of some of our prestigious RFP-led mandates.

Speaker #6: In addition, we also saw the margins being affected by cost inflation driven by ongoing geopolitical tensions, which resulted in higher procurement costs for technology, hardware, white goods, and key imports required for some of these projects.

Speaker #6: Since these mandates are currently in the deployment phase and have not yet reached steady-state revenue generation, the associated costs were incurred ahead of revenue realization, temporarily impacting profitability.

Ajay Rajan: Since these mandates are currently in the deployment phase and have not yet reached steady-state revenue generation, the associated costs were incurred ahead of revenue realization, temporarily impacting the profitability. On a normalized basis, however, excluding these investments, the EBITDA for the quarter would have been approximately INR 46 crores, which would have translated to EBITDA margin of around 17.2%. The company remains confident that these investments will begin contributing meaningfully to revenue in the coming quarters, which will result in improved operating leverage and margin recovery. Moreover, our balance sheet continues to remain strong with zero debt and more than INR 800 crores of cash and marketable securities. This gives us the flexibility to absorb these costs and also invest in strategic opportunities that will help us boost our product capabilities and resulting revenue and profitability. I'll share some details on the way businesses have delivered.

Speaker #6: On a normalized basis, however, excluding these investments, the EBITDA for the quarter would have been approximately ₹46 crore, which would have translated to an EBITDA margin of around 17.2%.

Speaker #6: The company remains confident that these investments will begin contributing meaningfully to revenue in the coming quarters, which will result in improved operating leverage and margin recovery.

Speaker #6: Moreover, our balance sheet continues to remain strong, with zero debt and more than ₹800 crore of cash and marketable securities. This gives us the flexibility to absorb these costs and also invest in strategic opportunities that will help us boost our product capabilities, resulting revenue, and profitability.

Speaker #6: I'll give some details on the way businesses have delivered. Our tax services, which is a source of transactional revenue for us, remained largely stable year-on-year, despite the industry-wide decline in PAN inflows.

Ajay Rajan: Our tax services, which is source of transactional revenue for us, remained largely stable year-on-year, despite an industry-wide decline in PAN issuances. This temporary decline in industry volumes can be attributed to certain change in income tax rules, which required applicants to submit additional document for date of birth proof, since Aadhaar was no longer accepted for this purpose post Honorable Supreme Court judgment. This change led to a non-digital flow, thereby causing a 12% decline in overall PAN issuances in the country. Despite this, however, Protean showed resilience in its distribution capabilities, and we gained 275 basis points in market share, moving from 59% in FY26 to 62% in Q1 FY27, while we issued over a crore PAN cards. Our CRA services, which generates both annuity and transactional revenue, continues to present a significant long-term opportunity. We onboarded around 3.9 million new subscribers during the quarter.

Speaker #6: This temporary decline in industry volumes can be attributed to a change in income tax rules, which required applicants to submit an additional document for date of birth proof, since Aadhaar was no longer accepted for this purpose.

Speaker #6: Post the Honorable Supreme Court judgment, this change led to a non-digital flow, thereby causing a 12% decline in overall PAN issuances in the country. Despite this, however, Protean showed resilience in its distribution capabilities, and we gained 275 basis points in market share, moving from 59% in FY26 to 62% in Q1 FY27, while we issued over 1 crore PAN cards.

Speaker #6: Our CRA services, which generate both annuity and transactional revenue, continue to present a significant long-term opportunity. We onboarded around 3.9 million new subscribers during the quarter, and we captured 95% of incremental subscriber additions.

Speaker #6: And I'm also proud to share that we onboarded more than 1,000 new corporates—the highest ever in a single quarter since inception. We continue to hold a dominant 97% share across NPS, KPY, and UPS, and are the primary CRA for the unified pension schemes.

Ajay Rajan: I'm also proud to share that we onboarded more than 1,000 new corporates, the highest ever in a single quarter since inception. We continue to hold a dominant 97% share across NPS, APY, and UPS, and are the primary CRA for the Unified Pension Scheme. Another encouraging development has been the NPS Vatsalya, which gained strong traction following revised guidelines offering greater withdrawal flexibility. While the total scheme subscriber base itself crossed over 2 lakhs, 78,000 of that was added by Protean during the last quarter itself. While maintaining full focus to retain and grow our government segment, where we hold dominant position, we will accelerate our growth in the non-government segment, where overall market penetration is low, but the annuity opportunity is the largest. Our highest-ever corporate onboarding in a single quarter is the early proof of that focus.

Speaker #6: Another encouraging development has been the NPS Vatsalya, which gained strong traction following revised guidelines offering greater withdrawal flexibility. While the total scheme subscriber base itself crossed over 2 lakh, 78,000 of that was added by Protean during the last quarter itself.

Speaker #6: So, while maintaining full focus to retain and grow our government segment, where we hold a dominant position, we will accelerate our growth in the non-government segment, where overall market penetration is low but the annuity opportunity is the largest.

Speaker #6: Our highest ever corporate onboarding in a single quarter is the early proof of that focus. More importantly, the Retirement Registry as a Service is a business where we will leverage our two decades of dominant experience and double down internationally, enabling governments across the world to modernize retirement systems using India’s and Protean’s proven experience.

Ajay Rajan: More importantly, the Retirement Registry as a Service is a business where we will leverage our two decades of dominant experience and double down internationally, enabling governments across the world to modernize the retirement system using India's and Protean's proven experience. Third is our identity services, which is a strong source of transactional revenue. We delivered 16% revenue growth year-on-year, supported by 20% combined volume growth. We remain the only company in the country which offers all four foundational identity services, and we are well-positioned to remain and grow as a preferred partner for the BFSI ecosystem, which is primarily driving these volumes. I want to call out here that businesses like eSign and more importantly, eSignPro, which is a complete digital documentation workflow solution from workflow to stamping to signing.

Speaker #6: Third is our identity services, which is a strong source of transactional revenue. We delivered 16% revenue growth year-on-year, supported by 20% combined volume growth.

Speaker #6: So, we remain the only company in the country that offers all four foundational identity services, and we are well positioned to remain and grow as a preferred partner for the BFSI ecosystem, which is primarily driving these volumes.

Speaker #6: I want to call out here that businesses like eSign, and more importantly, eSign Pro—which is the complete digital documentation workflow solution from workflow to stamping to signing—this is a unique moat for Protean and is a massively scalable and very, very profitable opportunity, both domestically and internationally.

Ajay Rajan: This is a unique model for Protean and is a massively scalable and a very, very profitable opportunity, both domestically and internationally. BFSI especially, and every government enterprise and institution has the opportunity and need to digitize this documentation workflow. I remain very, very confident that we will be able to monetize eSignPro in the coming future very, very well. I'm also encouraged by our new initiatives, which continue to deliver robust outcomes. This contributed 17% of our quarterly revenues as compared with 10% in FY26. This is in line with our stated objective to diversify our businesses and revenue lines, and this will continue to remain a key focus area. Some of the drivers here will be the strategic mandates like SRCEIS, CKYC, Bima Sugam, Aadhaar Seva Kendra, and the Agri Stack.

Speaker #6: BFSI especially, and every government enterprise and institution, has the opportunity and need to digitize this documentation workflow. So, I remain very, very confident that we will be able to monetize eSign Pro in the coming future very, very well.

Speaker #6: I'm also encouraged by our new initiatives, which continue to deliver robust outcomes. These contributed 17% of our quarterly revenues, as compared with 10% in FY26.

Speaker #6: This is in line with our stated objective to diversify our businesses and revenue lines, and this will continue to remain a key focus area.

Speaker #6: Some of the drivers here will be the strategic mandates like Sursize, CKYC, Bima Sugam, Aadhaar Seva Kendra, and the Agri Stack. So these are not only core DPI implementations; more importantly, each of them significantly opens up adjacent value-added opportunities for us where we can monetize on top of some of these initiatives.

Ajay Rajan: These are not only core DPI implementations, most importantly, each of them significantly opens up adjacent value-added opportunities for us where we can monetize on top of some of these initiatives. A quick update on the Aadhaar mandate. We have rolled out 75 ASKs across 24 states and union territories as of 26 July. We expect to complete the implementation by Q3, and revenue from these centers has already commenced, and it gives us visibility into a recurring transaction-based revenue stream. This is some of the numbers on performance in terms of the quarterly numbers. Sandeep will provide more details in terms of that. I would like to spend some time now in terms of our forward strategy. As I think about our present and future, I am seeing Protean's business through three important pillars. The pillar number 1 would be scaling our DPI proposition.

Speaker #6: A quick update on the Aadhaar mandate. We have rolled out 75 ASKs across 24 states and union territories as of July 26. We expect to complete the implementation by Q3, and revenue from these centers has already commenced. This gives us visibility into a recurring transaction-based revenue stream.

Speaker #6: So, these were some of the numbers on performance in terms of the quarterly numbers. Sandeep will provide more details on that.

Speaker #6: But I would like to spend some time now discussing our forward strategy. As I think about our present and future, I am seeing Protean's business through three important pillars.

Speaker #6: The first pillar would be scaling our DPI proposition. Through DPI 2.0, which is about strengthening the trusted platforms that have defined Protean's legacy, and accelerating the new foundational digital rails across sectors such as financial services, insurance, agriculture, health, education, and commerce.

Ajay Rajan: Through DPI 2.0, which is about strengthening the trusted platforms that has defined Protean's legacy and accelerating the new foundational digital rails across sectors such as financial services, insurance, agri, health, education, commerce. More sectoral will be the focus on DPI 2.0. The second pillar for us would be monetizing our core capabilities through solutioning for the enterprise digital ecosystem. This we will do by building value-added, AI-driven intelligence layer on top of those foundational rails delivered by a bundled solution-led approach, which solves meaningful problems for governments, institutions, and enterprises. The third strategic pillar would be our global expansion, which is taking India's and Protean's DPI capabilities to the global markets. Each of these pillars, as you will realize, present significant opportunities, and we will ensure that we innovate responsibly, more importantly, deliver consistently, and execute with speed, all while maintaining financial discipline.

Speaker #6: So, more sectoral will be the focus on DPI 2.0. The second pillar for us would be monetizing our core capabilities through solutioning for the enterprise digital ecosystem.

Speaker #6: We will do this by building a value-added, AI-driven intelligence layer on top of those foundational rails, delivered via a bundled, solution-led approach that solves meaningful problems for governments, institutions, and enterprises.

Speaker #6: The third strategic pillar would be our global expansion, which is taking India’s and Protean’s DPI capabilities to the global markets. Each of these pillars, as you will realize, presents significant opportunities, and we will ensure that we innovate responsibly.

Speaker #6: More importantly, deliver consistently and execute with speed, all while maintaining financial discipline. So, let me spend a few minutes on what we will do differently now.

Ajay Rajan: Let me spend a few minutes on what we will do differently now. In terms of our core strength, which is DPI, we will apply both domestically as well as internationally, a concept of DPI-in-a-box approach. This will be the most scalable expression of the solutioning approach that I spoke about earlier. This approach, what does it mean? It will be providing modular digital building blocks that a government can adapt for its own needs. For three decades, you will realize that Protean has built nearly most of these blocks today, whether it is digital identity, master registries for citizens, consent-based data sharing across frameworks, real-time verification services, secure data exchange, pension systems, tax administration platforms, compliance by design. Protean has had role to play in all of these.

Speaker #6: In terms of our cost spend, which is DPI, we will apply both domestically as well as internationally a concept of 'DPI in a Box' approach.

Speaker #6: This will be the most scalable expression of the solutioning approach that I spoke about earlier. So, this approach—what does it mean, right? It will be providing modular digital building blocks that a government can adapt for its own needs.

Speaker #6: For three decades, you would realize that Protean has built nearly most of these blocks today. Whether it is digital identity, master registries for citizens, consent-based data sharing across frameworks, real-time verification services, secure data exchange, pension systems, tax administration platforms, compliance by design—all of these, Protean has had a role to play in all of these, right?

Speaker #6: But when you look at the DPI box approach, we package these now as a modular, interoperable, configurable, and scalable stack. The objective is to take the benefit of a bundled citizen service proposition, accelerate implementation while retaining flexibility and ownership, rather than just commissioning a DPI built from scratch.

Ajay Rajan: When you look at the DPI box approach, we package these now as a modular, interoperable, configurable, and scalable stack. The objective is to take the benefit of a bundled citizen service proposition, accelerate implementation while retaining flexibility and ownership, rather than just commissioning a DPI built from scratch. This approach, we will deploy both in India as well as in the international markets. This will be a very differentiated but a more comprehensive approach where the intent will be a ready-to-deploy digital foundation rather than spending time on a multi-year integration program. In terms of our approach to monetize the DPI and creating value for the ecosystem, we will also move from a product-selling approach to a solution-led approach. The future of DPI, I believe, will be defined by how effectively we convert the access which we are creating into outcomes.

Speaker #6: So, this approach we will deploy both in India as well as in the international markets. And this will be a very differentiated but more comprehensive approach, where the intent will be a ready-to-deploy digital foundation, rather than spending time on a multi-year integration program.

Speaker #6: In terms of our approach to monetize the DPI and create value for the ecosystem, we will also move from a product-selling approach to a solution-led approach.

Speaker #6: The future of DPI, I believe, will be defined by how effectively we convert the access which we are creating into outcomes. And this, I believe, that success will be measured by how effectively our platforms improve lives and expand opportunities for citizens and businesses.

Ajay Rajan: This, I believe that success will be measured by how effectively our platforms improves lives and expands opportunity for citizens and businesses. The rails that we build carry enormous volumes. I alluded to some of those volumes at the starting of my session. Volume on its own is not value. If we simply chase more transactions of the same kind, we will grow revenue, but the margins will not grow. I am sure a lot of you have thoughts on that. That is exactly what I am planning to address via this. This is not the business we intend to build. We want to build a business where the margins are profitable. Let me make this whole approach that I mentioned about, let me make it real with two examples.

Speaker #6: The rails that we built carry enormous volumes, and I alluded to some of those volumes at the start of my session. But volume on its own is not value.

Speaker #6: If we simply chase more transactions of the same kind, we will grow revenue, but the margins will not grow. And I'm sure a lot of you have thoughts on that, right?

Speaker #6: So that is exactly what I am planning to address via this. This is not the business we intend to build. We want to build a business where the margins are profitable.

Speaker #6: So let me make this whole approach that I mentioned about—let me make it real with two examples. Today, if you look at a bank—and for us, banks and financial institutions actually reflect a very, very large, significant opportunity, which is where the fintechs are building a lot of solutions, right?

Ajay Rajan: Today, if you look at a bank. For us banks, banking or financial institutions, actually reflect a very, very large, significant opportunity, which is where the fintechs are building a lot of solutions. That is exactly what we would like to do. Today, when you look at a bank, it operates today in terms of onboarding customers digitally. For that, they take eKYC from one partner. They may take document verification and execution from another partner. They may take fraud and AML screening from a third partner. They may take a bank statement analysis from a fourth partner. E-signing and stamping of documents from a fifth partner, and CKYC reporting from a sixth partner. They build and maintain the plumbing between all of them.

Speaker #6: So, that is exactly what we would like to do. Today, when you look at a bank, it operates in terms of onboarding customers digitally.

Speaker #6: But for that, they take eKYC from one person. They may take document verification and execution from another partner. They may take fraud and AML screening from a third partner.

Speaker #6: They may take a bank statement analysis from a fourth partner, e-signing and stamping of documents from a fifth partner, and cKYC reporting from a sixth partner.

Speaker #6: Then they build and maintain the plumbing between all of them. And that fragmentation is expensive for them. It is fragile, and it accumulates technical debt, which in every handoff between systems becomes a target for customer drop-off.

Ajay Rajan: That fragmentation is expensive for them, it is fragile, and it accumulates technical debt, which in every handoff between systems becomes a target for a customer drop-off. I have seen it for 30 years on the other side, that this is a real-life situation which every financial institution in the country today grapples with. This is where Protean, with its dominance in some of these foundational products, will adopt a client-centric approach by bundling the right combination of our platforms, APIs, and most importantly, the delivery capability to deliver an end-to-end solution. When you look at what I spoke earlier, all the underlying components, whether it is identity, verification, consent, signing, the registries, everything gets configured differently for each customer, and this changes the conversation from selling a product to owning an outcome.

Speaker #6: And I have seen it for 30 years on the other side, that this is a real-life situation which every financial institution in the country today grapples with.

Speaker #6: So this is where Protean, with its dominance in some of these foundational products, will adopt a client-centric approach by bundling the right combination of our platforms, APIs, and most importantly, the delivery capability to deliver an end-to-end solution.

Speaker #6: So when you look at what I spoke about earlier, all the underlying components—whether it is identity, verification, consent, signing, or the registries—everything gets configured differently for each customer.

Speaker #6: And this changes the conversation from selling a product to owning an outcome. By bringing together all this technology, domain expertise, and execution capabilities into an integrated solution, we not only achieve scalability of our offerings, we deepen our customer relationships, we create greater stickiness, and, most importantly, we build a sustainable, profitable, high-margin business.

Ajay Rajan: By bringing together all this technology, domain expertise, and execution capabilities into an integrated solution, we not only achieve scalability of our offerings, we deepen our customer relationship, we create a greater stickiness, and most importantly, we build sustainable, profitable, high-margin business. Another example, if I may take, is retail lending. This is where maximum volumes are seen by banks, NBFCs, et cetera. Now, when a customer applies for a personal loan on a lender's app, this is where our C-KYC solution with Aadhaar authentication can help establish the identity in seconds. With the customer consent, Protean's Account Aggregator can pull a bank statement, which our analyzer can convert into an income cash flow view for the underwriter.

Speaker #6: Another example, if I may take, is a retail lending. And this is where maximum volumes are seen by banks and BFCs, et cetera, right?

Speaker #6: Now, when a customer applies for a personal loan on a lender's app, this is where our cKYC solution with Aadhaar authentication can help establish the identity in seconds.

Speaker #6: Then, with the customer's consent, Protean's account aggregator can pull a bank statement, which our analyzer can convert into an income cash flow view for the underwriter.

Speaker #6: Through our e-sign flow, the sanction letter and loan agreement can be generated from a template, stamped with the relevant state e-stamp, and then e-signed with Aadhaar, making the lender ready for disbursement.

Ajay Rajan: Through our eSignPro, the sanction letter, loan agreement can be generated from a template, stamped with the relevant state e-stamp, then eSigned with the Aadhaar, making the lender ready for disbursement. This is where Protean in a consented and intelligent framework with one journey, one contract, one integration, can help eliminate that friction which today exists across every financial journey. Earlier, what used to be multi-vendor, multi-month integration program, can become a very seamless one-step integration. That's the whole point, right? The building blocks don't change, but the configuration does. How does it impact our margins? We are moving from being priced per API call to being priced per journey, per outcome. Which becomes a very different conversation fundamentally on value, which leads to better margin improvement.

Speaker #6: Now, this is where Protean, in a consented and intelligent framework with one journey, one contract, and one integration, can help eliminate that friction which exists today across every financial journey.

Speaker #6: Earlier, what used to be a multi-vendor, multi-month integration program can become a very seamless, one-step integration. So that's the whole point, right? The building blocks don't change.

Speaker #6: But the configuration does. We are also moving from being priced per API call to being priced per journey, per outcome, which becomes a very different conversation fundamentally on value and which leads to better margin improvement.

Speaker #6: So, our mix shifts from higher-margin, value-added services and away from just pass-through volume, which is currently the case. Also, more importantly, the client stickiness improves, and that is where our product penetration also improves within the ecosystem.

Ajay Rajan: Our mix shifts from higher margin value-added services and away from just pass-through volume, which currently is what the case. More importantly, the client's stickiness improves which is where our product penetration also improves with the ecosystem. In summary, we intend to move from volume and growth to value creation, better margins, better profitability, deeper long-lasting customer relationships, and everything that we build in this layer will be distributed through a multi-sector API service platform, which we will deliver in a sandbox-enabled, ready-to-consume workflow. Why do I believe that Protean is most uniquely placed to creating this digital ecosystem on top of the foundational DPI rails? Because we own or operate almost every component required end-to-end under the relevant regulatory license.

Speaker #6: So, in summary, we intend to move from volume and growth to value creation: better margins, better profitability, deeper, long-lasting customer relationships. Everything that we build in this layer will be distributed through a multi-sector API service platform, which we will deliver in a sandbox-enabled, ready-to-consume workflow.

Speaker #6: And why do I believe that Protean is most uniquely placed to create this digital ecosystem on top of the foundational DPI rails? Because they own or operate almost every component required end-to-end, under the relevant regulatory license.

Speaker #6: And for the rest, we can always have a partnership approach, where we bring in the right partner, and in due course, maybe make the right acquisition to bring it in-house.

Ajay Rajan: For the rest, we always can have a partnership approach where we bring in the right partner, and in due course, maybe the right acquisition, to bring it in-house. The third pillar will be our international strategy. This we will be very deliberately focused and prioritize a smaller number of geographies where the need is real, funding is identifiable, and where our reference credentials adds value for Protean. More importantly, we will enter it in a light touch model, which is partnership-led, capital light, and we will work with multilateral institutions and local system integrators in those locations. The more important part is the whole DPI in a Box approach, which I had detailed about. I see a big opportunity for us to contribute to the global digital transformation initiatives from a Protean perspective.

Speaker #6: The third pillar will be our international strategy. And this, we will very deliberately focus and prioritize on a smaller number of geographies, where the need is real, funding is identifiable, and where our reference credentials add value for Protean.

Speaker #6: More importantly, we will enter it in a light-touch model through partners, which is partnership-led, capital-light, and we will work with multilateral institutions and local system integrators in those locations.

Speaker #6: The more important part is the whole DPI-in-a-box approach, which I had detailed earlier. I see a big opportunity for us to contribute to global digital transformation initiatives from a Protean perspective.

Speaker #6: So, this export of India's model of digital democracy will be a generational opportunity in my mind—positioned as India's national trust architect, for which India Protean will be one of the most natural carriers for the globe.

Ajay Rajan: This export of India's model of digital democracy will be a generational opportunity in my mind, as positioned as India's national trust architect, for which Protean will be one of the most natural carriers for the globe. Another area that I would like to draw attention for everyone is the CKYC mandate, which we are building for them. I believe this will be a game-changer mandate. Today, a citizen must prove who they are again and again to the bank, insurer, mutual fund, every financial institution. Same document, same friction, same cost every time. Vision of CKYC is simple. Prove it once and with consent, carry the trust everywhere. Build trust once, reuse it a billion times. This is what Protean is building under the CERSAI mandate, maintaining the next generation central KYC record registry.

Speaker #6: Another area that I would like to draw attention to for everyone is the cKYC mandate which we are building for them. And I believe this will be a game-changer mandate.

Speaker #6: Today, a citizen must prove who they are again and again—to the bank, insurer, mutual fund, every financial institution. Same document, same friction, same cost, every time.

Speaker #6: The vision of cKYC is simple: prove it once and, with consent, carry that trust everywhere. Build trust once; reuse it a billion times. And this is what Protean is building under the SERSAI mandate.

Speaker #6: Maintaining the next-generation central KYC record registry, API-first and cloud-native overall, which is migrating over a billion-plus records backed by all four financial regulators.

Ajay Rajan: API first, cloud native overall, which is migrating over a billion plus records backed by all the four financial regulators. That's only one side of the equation, which is the sovereign record of the financial identity. The equally or more valuable side is the other side. Once the registry is modernized, every regulated entity in the country will need to connect to it. To search, download, report, build onboarding journeys on top of it, and digitize their own processes. We have built that side also, not only the C-KYC APIs, but also bundling them with our broader API stack to give comprehensive proposition to our BFSI customers who are going to be the biggest users of this. We are not only building the database, we are building the on-ramps onto it.

Speaker #6: But that's only one side of the equation, which is the sovereign record of the financial identity. The equally or more valuable side is the other side.

Speaker #6: Because once the registry is modernized, every regulated entity in the country will need to connect to it to search, download, report, build onboarding journeys on top of it, and digitize their own processes.

Speaker #6: We have built that side also. Not only the cKYC APIs, but also bundling them. There is a broader API stack to give a comprehensive proposition to our BFSI customers, who are going to be the biggest users of this.

Speaker #6: We are not only building the database; we are building the on-ramps onto it. And while the registry was a fee mandate, the on-ramps will be a mix of recurring opportunity across thousands of regulated entities, and also certain fee-based mandates.

Ajay Rajan: While the registry was a fee mandate, the on-ramps will be a mix of recurring opportunity across thousands of regulated entities and also certain fee-based mandates. Operating the trust registry and monetizing the access layer that is what we intend to replicate across all our infrastructure assets. This is going to be the approach on every DPI mandate that Protean is running to. On the cost and capital allocation side, I also want to assure everyone, and I'm preempting maybe some of the questions which will come up. I would like to assure everyone that we are also reviewing our portfolio through clear capital allocation lens. Some of our businesses will depend on the pace at which wider ecosystem matures. While we may decide to stay passively invested, we will calibrate our incremental energy towards some of these initiatives where we see immediate revenue maximization.

Speaker #6: So, operating the trust registry and monetizing the access layer—that is what we intend to replicate across all our infrastructure assets. This is going to be the approach on every DPI mandate that Protean is running to.

Speaker #6: On the cost and capital allocation side, I also want to assure everyone—and I'm preempting maybe some of the questions that will come up.

Speaker #6: So I would like to assure everyone that we are also reviewing our portfolio through a clear capital allocation lens. Some of our businesses will depend on the pace at which the wider ecosystem matures.

Speaker #6: But while we may decide to stay passively invested, we will calibrate our incremental energy towards some of these initiatives where we see maximum immediate revenue maximization.

Speaker #6: Cloud and account aggregator are, as of today, small businesses for us. But they remain strategically relevant assets, and we are very actively sharpening the commercial model for both of them.

Ajay Rajan: Cloud and Account Aggregator both are, in today's day, a small business for now, but remain strategically relevant assets for us, and we are very actively sharpening the commercial model for both of them. Our MeitY certified sovereign cloud in particular, is genuinely differentiated for mission critical and regulated workloads, and it is an important enabler of this sovereign by design proposition we take to our government customers. Our approach here will be to look at strategic partnerships and investments, which will build a clear path to scale and profitability. To conclude, Protean has spent 30 years quietly, reliably building the foundations of India's digital future. That work has made us India's national trust architect. Our ambition now is to carry that role forward from building rails to building the intelligence layer above them, from products to solutions, and from India to the world.

Speaker #6: Our MATE-certified sovereign cloud, in particular, is genuinely differentiated for mission-critical and regulated workloads. It is an important enabler of this 'sovereign by design' proposition that we take to our government customers.

Speaker #6: Our approach here will be to look at strategic partnerships and investments, which will build a clear path to scale and profitability. So, to conclude, Protean has spent 30 years quietly and reliably building the foundations of India's digital future.

Speaker #6: That work has made us India's national trust architect. Our ambition now is to carry that role forward—from building rails to building the intelligence layer above them, from products to solutions, and from India to the world.

Speaker #6: My commitment to you is to pair these three decades of trust with sharper execution, stronger profitability, and, more importantly, a bolder ambition. In doing so, we aim to create durable long-term value for all our stakeholders.

Ajay Rajan: My commitment to you is to pair these three decades of trust with sharper execution, stronger profitability, more importantly, a bolder ambition, and in doing so, create durable long-term value for all our stakeholders. I would also encourage you to go through our investor presentation, where we have articulated our forward strategy and long-term growth roadmap in more detail. I really thank you sincerely for the confidence in Protean. I would hand over to our CFO, Sandip Mantri, to take you through additional details on the financials.

Speaker #6: I would also encourage you to go through our investor presentation. There, we have articulated our forward strategy and long-term growth roadmap in more detail.

Speaker #6: And I really thank you sincerely for the confidence in Protean. I would now hand over to our CFO, Sandeep Mantri, to take you through additional details on the financials.

Speaker #1: Thank you, Ajay. First of all, let me welcome you to Protean in the first earning call of Protean. Very detailed explanation, quite helpful. And my last two months experience is quite enriching in terms of laying down the strategy so clearly for Protean for the next many years.

Sandeep Mantri: Thank you, Ajay. First of all, let me welcome you to Protean and the first earnings call of Protean. It's a very detailed explanation, quite helpful. My last two months' experience is quite enriching in terms of laying down the strategy so clearly for Protean for the next many years. With this, good evening, everyone. Thank you for joining us today. Before I discuss our financial performance, let me briefly touch upon the industry backdrop. The digital public infrastructure industry in India continue to benefit from strong policy support, increasing digital adoption across government and regulated sectors. We are seeing growing demand for interoperable API-led platform that enable identity, onboarding, authentication, payment, and data exchange at scale. As institution move from standalone digital initiative to integrated digital ecosystem, as talked by Ajay, the opportunity for the trusted infrastructure provider is expanding.

Speaker #1: With this good evening, everyone. Thank you for joining us today. Before I discuss our financial performance, let me briefly touch upon the industry backdrop.

Speaker #1: The digital public infrastructure industry in India continued to benefit from strong policy support, increasing digital adoption across government and regulated sectors. We are seeing growing demand for interoperable API-led platform that enable identity, onboarding, authentication, payment, and data exchange at scale.

Speaker #1: As institutions move from standalone digital initiatives to an integrated digital ecosystem, as mentioned by Ajay, the opportunity for trusted infrastructure providers is expanding. With our leadership position in tax, pension, and identity services, along with our investment in a next-generation DPI platform, we believe that Protean is well positioned to participate in this structural growth opportunity through its solution-led approach.

Sandeep Mantri: With our leadership position in tax, pension, and identity services, along with investment in next generation DPI platform, we believe that Protean is well-positioned to participate in this structural growth opportunity through its solution-led approach. Let me take you through the financial performance for the Q1 ended 30 June 2026. I am pleased to share that our quarter-on-quarter performance aligned with this trend with healthy volume across most of the businesses, driven by market share expansion, growing traction in our value-added offerings and other new initiatives. Revenue from operations for Q1 FY27 stood at INR 251 crore, which is an impressive growth of 19% YOY as compared to INR 211 crore in last year same quarter. This was primarily driven by continued momentum across most of our core businesses as well as new initiatives.

Speaker #1: Now, let me take you through the financial performance for the first quarter ended 30th June 2026. I am pleased to share that our quarter-on-quarter performance aligned with this trend, with healthy volume across most of the businesses driven by market share expansion, growing traction in our value-added offerings, and other new initiatives.

Speaker #1: Revenue from operation for quarter one acquired 27 is two decks, 251 crores, which is an impressive growth of 19%. While as compared to 211 crores in last year same quarter.

Speaker #1: This was primarily driven by continued momentum across most of our core businesses as well as new initiatives. EBITDA for the quarter is stood at 28 crores, with an EBITDA margin of 10% compared to 45 crores and a margin of 18.7% in the corresponding quarter last year.

Sandeep Mantri: EBITDA for the quarter stood at INR 28 crore with an EBITDA margin of 10% compared to INR 45 crore and a margin of 18.7% in the corresponding quarter last year. The decline in margin was primarily driven by upfront investment of around INR 18 crore incurred towards the implementation of multiple RFP mandates. In addition, margin were also affected by cost inflation arising from ongoing geopolitical tensions, which resulted in high procurement cost for technology hardware and software, bought-in goods and other key input required for implementing these projects. It is important to note that these strategic mandates are currently in the development phase and are yet to reach a steady state revenue generation. As a result, a significant portion of the implementation cost has been recognized ahead of the corresponding revenue, creating a temporary impact on profitability.

Speaker #1: The decline in margin was primarily driven by upfront investment of around 18 crores incurred towards the implementation of multiple RFP mandates in addition margin were also affected by cost inflation arising from ongoing geopolitical tensions which resulted in high procurement cost for technology hardware and software while goods and other key input required for implementing these projects.

Speaker #1: It is important to note that these strategic mandates are currently in the development phase and have yet to reach steady-state revenue generation. As a result, a significant portion of the implementation cost has been recognized ahead of the corresponding revenue, creating a temporary impact on profitability.

Speaker #1: On a normalized basis, excluding these upfront investments, EBITDA for the quarter would have been ₹46 crore, translating into an EBITDA margin of around 17.2%.

Sandeep Mantri: On a normalized basis, excluding these upfront investments, EBITDA for the quarter would have been INR 46 crore, translating into an EBITDA margin of around 17.2%, broadly in line with our historical operating performance. Profit after tax for the quarter stood at INR 6 crore with PAT margin of 2.2%, we delivered an earnings per share of INR 1.44 for Q1 FY27. As EBITDA was impacted by one-timer, so the profit is. We remain confident that as these projects progress towards full scale deployment and revenue generation over the coming quarter, operating leverage will improve, supporting a recovery in margin while strengthening the company's long-term growth trajectory. From a cost perspective, we continue to maintain discipline while investing selectively for future growth. Employee benefit expenses increased primarily due to hiring for the Aadhaar Seva Kendra project and incentive, while other expenses reflected investment in infrastructure, technology and project execution.

Speaker #1: Operating performance: Profit after tax for the quarter stood at ₹6 crore, with a PAT margin of 2.2%. We delivered an earnings per share of ₹1.44 for Q1 FY27.

Speaker #1: But as EBITDA was impacted by one timer, so the profit is. We remain confident that as these projects progress towards full-scale deployment, and revenue generation over the coming quarter, operating leverage will improve, supporting a recovery in margins while strengthening the company's long-term growth trajectory.

Speaker #1: From a cost perspective, we continue to maintain discipline while investing selectively for future growth. Employee benefit expenses increased primarily due to hiring for the Aadhaar Seva Canon project and incentive, while other expenses reflected investment in infrastructure, technology, and project execution.

Speaker #1: At the same time, we are actively reviewing our cost structure and identifying opportunities to improve efficiency through greater use of technology and AI across the organization, which was highlighted by Ajay also in his speech.

Sandeep Mantri: At the same time, we are actively reviewing our cost structure and identifying opportunities to improve efficiency through greater use of technology and AI across the organization, which was highlighted by Ajay also in his speech. While these investments have impacted near-term profitability, they are being made against opportunities that we believe can create meaningful recurring revenue streams as these mandates move into steady state operations. Our focus therefore is to ensure that the growth we pursue must translate into sustainable and profitable growth over the medium to long term. An important part of this approach is our shift from pursuing volume growth towards creating greater value from our platform and capability. We are increasingly focused on a higher margin, value-added solutions and integrated offerings that can deepen customer relationships, improve revenue quality, and strengthen profitability. Our approach to capital allocation will also remain disciplined.

Speaker #1: While these investments have impacted near-term profitability, they are being made against opportunity that we believe can create meaningful revenue streams recurring revenue stream as these mandate move into steady state operations.

Speaker #1: Our focus, therefore, is to ensure that the growth we pursue must translate into sustainable and profitable growth over the medium to long term. An important part of this approach is our shift from pursuing volume growth towards creating greater value from our platform and capability. We are increasingly focused on higher-margin, value-added solutions and integrated offerings that can deepen customer relationships, improve revenue quality, and strengthen profitability.

Speaker #1: Our approach to capital allocation will also remain disciplined. We will continue to evaluate our portfolio and prioritize investment opportunities where we see the strongest potential for revenue growth, margin improvement, and long-term value creation for the company.

Sandeep Mantri: We will continue to evaluate our portfolio and prioritize investment opportunities where we see the strongest potential for revenue growth, margin improvement, and long-term value creation for the company. From a balance sheet perspective, we remain in a strong financial position. As of June 30, 2026, the company had more than INR 800 crore in cash equivalents and marketable securities and remains completely debt-free. This provides us with significant flexibility to invest selectively in technology, innovation, strategic opportunities, and growth initiatives while maintaining financial resilience. To conclude, while the current quarter reflects the near-term impact of investments being made to build the next phase of growth, our focus remains very clear. Strengthen execution, improve operational efficiency, enhance the quality of our revenue, and drive sustainable profitability.

Speaker #1: From a balance sheet perspective, we remain in a strong financial position as of June 30th, 2026. The company had more than 800 crores in cash equivalent and marketable securities, and remained completely debt-free.

Speaker #1: This provides us with significant flexibility to invest selectively in technology, innovation, strategic opportunity, and growth initiative, while maintaining financial resilience. To conclude, while the quarter current quarter reflects the near-term impact of investment being made to build the next phase of growth, our focus remains very clear: strengthen execution, improve operational efficiency, enhance the quality of our revenue, and and drive sustainable profitability.

Speaker #1: With our strong balance sheet, increasing contribution, from new businesses and a robust pipeline of DPI-led opportunity, we remain confident in our ability to build a stronger and more profitable Protean and deliver sustainable long-term value for our all our stakeholders.

Sandeep Mantri: With our strong balance sheet, increasing contribution from new businesses, and a robust pipeline of DPI-led opportunities, we remain confident in our ability to build a stronger and more profitable Protean and deliver sustainable long-term value for all our stakeholders. With that, I conclude my remarks and request the moderator to open the floor for question and answer. Thank you so much.

Speaker #1: With that, I conclude my remarks and request the moderator to open the floor for question and answer. Thank you so much.

Speaker #2: Thank you very and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two.

Sandeep Mantri: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star 1 on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rohan M. from Equirus Securities. Please go ahead.

Operator: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star 1 on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rohan M. from Equirus Securities. Please go ahead.

Speaker #2: Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rohan M.

Speaker #2: from Equitas Security. Please go ahead.

Speaker #3: Good evening, sir, and thanks for the opportunity. Sir, firstly, during your opening remarks, you spoke about inorganic growth opportunities. Which segments or areas are you exploring for those opportunities?

Rohan Mandora: Good evening, sir, and thanks for the opportunity. Sir, firstly, during your opening remarks, you had talked about inorganic growth opportunities. Which segments or which areas are you exploring those opportunities?

Rohan M: Good evening, sir, and thanks for the opportunity. Sir, firstly, during your opening remarks, you had talked about inorganic growth opportunities. Which segments or which areas are you exploring those opportunities?

Speaker #1: See, we will we are actually right now, as I mentioned to you, looking at all opportunities which meet certain objectives for us, which is either it improves our health, improves our processes, or reduces our cost.

Sandeep Mantri: We are actually right now, as I mentioned to you, looking at all opportunities which meet certain objectives for us, which is either it helps improve our processes or reduces our cost, or it adds directly to our top line or more importantly, bottom line. I am not at the liberty of right now sharing specific details. As we speak, we are looking at a couple of very strong inorganic opportunities, which meets these particular objectives that I have mentioned. Right now, we are focusing on something which will either help me on my top line, bottom line or reducing my cost through automation.

Speaker #1: Or it adds directly to our top line or more importantly, bottom line. I'm not at the liberty of right now sharing specific details, but as we speak, we are looking at a couple of very very very strong inorganic opportunities which meets this particular objectives that I have mentioned.

Speaker #1: So right now, we are focusing on something which will either help me on my top line, bottom line, or reducing my cost through automation.

Speaker #3: Sure, sir. Sir, the second question is on Aadhaar Seva Kendra. With respect to all the rollouts that are expected in various districts, is the people cost already baked into this quarter's numbers, or can we expect the employee expenses to go up further?

Rohan Mandora: Sure, sir. Sir, second is on Aadhaar Seva Kendra. With respect to all the rollouts that are expected in various states, is the people cost already baked in into this quarter numbers, or can we expect the employee expenses to go up further? Does the Q1 number also factor in the salary hikes that the organization would have taken?

Rohan M: Sure, sir. Sir, second is on Aadhaar Seva Kendra. With respect to all the rollouts that are expected in various states, is the people cost already baked in into this quarter numbers, or can we expect the employee expenses to go up further? Does the Q1 number also factor in the salary hikes that the organization would have taken?

Speaker #3: And does the 1Q number also factor in the wage the salary hikes that the organization would have taken?

Speaker #1: Yeah, so I for Aadhaar Seva Kendra, people cost have been backed up for most of the Aadhaar Seva Kendra, but still there are quite a few Aadhaar Seva Kendra which are yet to be operational in quarter three.

Sandeep Mantri: Yeah. For Aadhaar Seva Kendra, people could have been baked up for most of the Aadhaar Seva Kendra. Still, there are quite a few Aadhaar Seva Kendra which are yet to be operational in Q3. For those Aadhaar Seva Kendra, cost will come in Q2 or Q3, depending on the rollout. The hiring is on.

Speaker #1: So, for those Aadhaar Seva Kendras, the costs will come in Q2 or Q3 depending on the rollout. But the hiring is on.

Speaker #3: Right. So what kind of an increase can we expect till by 3Q on employee expenses?

Rohan Mandora: Right. What kind of an increase can we expect by Q3 on employee expenses?

Rohan M: Right. What kind of an increase can we expect by Q3 on employee expenses?

Speaker #1: On the employee expenses? On account of Aadhaar?

Sandeep Mantri: On the employee expenses on account of Aadhaar?

Speaker #3: By Q3. So overall, overall employee expenses by Q3, just to get a sense?

Rohan Mandora: By Q3. Overall employee expenses by Q3, just to get a sense.

Rohan M: By Q3. Overall employee expenses by Q3, just to get a sense.

Speaker #1: So overall employee expenses, I would not be able to tell you right now because there are a lot of Aadhaar Seva Kendra where we are still hiring is still going on, and there will be a lot of changes as Ajay rightly said in strategy toward building cost initiatives and achieving more and efficient initiatives to reduce the cost of operation.

Sandeep Mantri: Overall employee expenses, I would not be able to tell you right now because there are a lot of Aadhaar Seva Kendra where hiring is still going on. There will be a lot of changes, as Ajay rightly said, in our strategy towards building cost initiatives and achieving more and efficient initiatives to reduce the cost of operations. However, except Aadhaar Seva Kendra employees, the cost will remain more or less same.

Speaker #1: However, the cost will accept Aadhaar, the cost accept Aadhaar Seva Kendra employees, the cost will remain more or less same.

Speaker #3: Okay. So just to ask, Ajay, out of the 69 crores, what would be the cost of Aadhaar Seva Kendra right now?

Rohan Mandora: Okay. Just want to ask the other way, out of the 690, what will be the cost of Aadhaar Seva Kendra right now?

Rohan M: Okay. Just want to ask the other way, out of the 690, what will be the cost of Aadhaar Seva Kendra right now?

Speaker #1: I can't specifically tell you because we are not disclosing segments with them.

Sandeep Mantri: I can't specifically tell you because we are not disclosing segments.

Speaker #3: And on the Aadhaar Seva Kendras which have gone live, in terms of the revenue trends there, if you can just touch base on for the centers which are already operational for more than one month, like how is the margins that is shaping up, and are the revenues in line with what was the original expectation when the contractor was awarded to us?

Rohan Mandora: On the Aadhaar Seva Kendra which have gone live, in terms of the revenue trends there, if you can just touch base on for the centers which are already operational for more than one month, how is the margins that is shaping up, and are the revenues in line with what was the original expectation when the contract was awarded to us? This is the district mapping of A, B, C, D.

Rohan M: On the Aadhaar Seva Kendra which have gone live, in terms of the revenue trends there, if you can just touch base on for the centers which are already operational for more than one month, how is the margins that is shaping up, and are the revenues in line with what was the original expectation when the contract was awarded to us? This is the district mapping of A, B, C, D.

Speaker #3: Basis that district mapping of A, B, C, D?

Speaker #1: Rohan, it's very, very early to say right now, because the Aadhaar Seva Kendras have been operational for the last three or four months. So I think we need to see the trend for at least one more quarter, and then we can provide some visibility on what kind of revenues. But having said that, the initial estimates are in line with our expectations.

Sandeep Mantri: Rohan, very early to say right now, because the Aadhaar Seva Kendras are operational for last three, four months. I think we need to see the trend for at least one more quarter, and then we can provide some visibility on what kind of revenues. Having said that, the initial estimates are in line with our expectations.

Speaker #3: So we had always, Rohan, in this case, the ramped-up model because once the setup happens, it takes a certain bit of time for people to start coming in and volumes getting ramped up.

Ajay Rajan: We had always, Rohan, envisaged a ramped up model because once the setup happens, it takes a certain bit of time for people to start coming in and volumes getting ramped up. Whatever estimates that we had done at the time of the RFP, the initial assessments are more or less in line with those expectations.

Speaker #3: So whatever estimates that we had done at the time of the RSP, the initial assessments are more or less in line with those expectations.

Rohan Mandora: Sure.

Rohan M: Sure.

Speaker #3: So yeah. So the numbers seem to be on target, and that's in line with what we had expected. And maybe just since you asked specifically on the inorganic, I'll give you a little more color on that.

Ajay Rajan: The numbers seem to be on target and that's in line with what we had expected. Maybe since you asked specifically on the inorganic, I'll give you a little more color on that. See, for us, the overall BFSI segment will be one of the most focused segment from an enterprise value creation perspective. In my entire speech, I also alluded to the intelligence layer that we are creating. A lot of the DPI that we have created in terms of benefit to the citizens, it'll eventually have to be through culmination of some financial services for citizens or enterprises.

Speaker #3: See, for us, the overall BFSI segment will be one of the most focused segment from a enterprise value creation perspective. So in my entire speech, I also alluded to the intelligence layer that we are creating.

Speaker #3: So a lot of the DPI that we have created in terms of benefit to the citizens, it'll eventually have to be through culmination of some financial services for citizens or enterprises.

Speaker #3: So very broadly, Rohan, the acquisition that we will look at will be in this space so that it fastens our go-to-market towards delivering some of those solutions and start quickly generating revenue and more importantly, start generating profitability by us, having the enablement to deliver some of those solutions to the enterprises or BFSI segment in a very fast GTM.

Ajay Rajan: Very broadly, Rohan, the acquisition that we will look at will be in this space so that it fastens our go-to-market towards delivering some of those solutions and start quickly generating revenue and more importantly, start generating profitability by us having the enablement to deliver some of those solutions to the enterprises or BFSI segment in a very fast GTM. Just to the extent that I can share right now specifics, I'm being transparent with you that this is the area that we are looking at.

Speaker #3: So, just to the extent that I can share right now specifics, I'm being transparent with you that this is the area that we are looking at.

Speaker #3: Sure. Thanks, sir. And lastly, on the PAN 2.0 readiness, would we need to make any changes in the process or the offerings that we do, or maybe the people team structure?

Rohan Mandora: Sure. Thanks, sir. Lastly, on the PAN 2.0 readiness, would we need to make any changes in the process or the offerings that we do, or maybe the people team structure? Is there something required at our end so whenever PAN 2.0 goes live, we get some share of the revenue?

Rohan M: Sure. Thanks, sir. Lastly, on the PAN 2.0 readiness, would we need to make any changes in the process or the offerings that we do, or maybe the people team structure? Is there something required at our end so whenever PAN 2.0 goes live, we get some share of the revenue?

Speaker #3: Is there something required at our end, so whenever PAN 2.0 goes live, we get some share of the revenue?

Speaker #1: It's very early to say right now. I think PAN 2.0 is still some way away. So, for PAN 2.0, as of now, we are not required to make any changes on our platform.

Sandeep Mantri: Very early to say right now. I think PAN 2.0 is still away. PAN 2.0, as of now, we are not required to make any changes in our platform. We will see how things open.

Speaker #1: But we will see how things go.

Rohan Mandora: Sure.

Rohan M: Sure.

Speaker #3: Sure. And again, from a clarity perspective, I think in the earlier calls also, this has been discussed and shared that a lot of the volumes or in fact, bulk of the volumes continue to come through assisted model.

Ajay Rajan: Yes. Again, from a clarity perspective, I think, in the earlier calls also, this has been discussed and shared that a lot of the volumes are in fact, bulk of the volumes continue to come through assisted model. Even if you look at this quarter, while it was an aberration because of the firm friction, the volumes every quarter, we have only seen increasing in the assisted mode, which is basically our core distribution capabilities. More importantly, if you see even in a falling overall number quarter, which is this quarter, where the overall numbers went down, but Protean share increased close to almost 275 basis points increase in Protean share happened. While we will look at more visibility in terms of how exactly PAN 2.0 will pan out, but we remain confident that we will remain relevant in this piece.

Speaker #3: And even if you look at this quarter, while it was an aberration because of the form friction, A) the volumes—every quarter we have only seen an increase in the assisted mode, which is basically our core distribution capabilities.

Speaker #3: And more importantly, if you see, even in a quarter with an overall falling number—which is this quarter, where the overall number went down—the protein share increased by close to almost 275 basis points. An increase in protein share happened.

Speaker #3: So while we will look at more visibility in terms of how exactly PAN 2.0 will pan out, we remain confident that we will remain relevant in this space.

Speaker #3: Of course, but more clarity on that as the date comes in, I think we'll get more clarity around that.

Ajay Rajan: Of course, more clarity on that as the date comes in. I think we'll get more clarity around that time.

Speaker #1: And Rohan, to further answer your question on employee benefit expenses, our endeavor will be to see that we create a scalable organization, so that when we grow from here, we need not hire additional people to deliver the projects or the revenue.

Sandeep Mantri: Rohan, to further answer your question on employee benefit expenses, our endeavor will be to see that we create a scalable organization so that when we grow from here, we need not to hire additional people to deliver the projects or the revenue. At the end of the year, I think we will see some cost reduction while it's maybe offset by the increments which we give. Otherwise, aside ASK, I don't see any major increase in employee expenses.

Speaker #1: So, at the end of the year, I think we will see some cost reduction, while it may be offset by the increments, if you give.

Speaker #1: Otherwise, aside ask, I don't see any major increase in employee expenses.

Speaker #3: Sure, sir. Thanks. Thanks a lot.

Rohan Mandora: Sure, sir. Thanks. Thanks a lot.

Rohan M: Sure, sir. Thanks. Thanks a lot.

Speaker #2: The next question is from the line of Deepak Agarwal from Param Capital. Please go ahead.

Rohan Mandora: The next question is from the line of Deepak Agrawal from Param Capital. Please go ahead.

Operator: The next question is from the line of Deepak Agrawal from Param Capital. Please go ahead.

Speaker #4: Yeah. Good evening, sir. Am I audible, sir?

Deepak Agrawal: Yeah. Good evening, sir. Am I audible, sir?

Speaker #1: Yeah.

Sandeep Mantri: Yeah.

Speaker #4: Yeah. Sir, my question was, as investors, generally people would want to see consistency to the fact is, if you see over the last five, seven years, we have grown from about 800 growth top line to about 1,000 growth in the last five, six years from 2019.

Deepak Agrawal: Yeah. My question was, like as investors, generally people would want to see consistency because the fact is, if you see over last five, seven years, we have grown from about INR 300 crore top line to close to INR 1,000 crore in last five, six years in terms of revenue. But EBITDA margin profile used to be as high as 23%, which has deteriorated to about 11% now. I would love to hear your thoughts in terms of where do you think this margin profile is sustainable? Obviously we are investing ahead of, as we have mentioned in the press release as well for newer projects. In the longer run, sir, where do you see the EBITDA margin for the overall entity stabilizing once you are through with these upfront investments?

Speaker #4: Our EBITDA margin profile used to be as high as 23%, which has deteriorated to about 11% now. I would love to hear your thoughts in terms of where you think this margin profile is sustainable.

Speaker #4: So obviously, we are investing ahead of as we had mentioned in the press release as well for newer projects. In the longer runs of where do you see the EBITDA margin for the overall entity stabilizing once you are through with these upfront investments?

Speaker #1: No. Deepak, unfortunately, this quarter was affected, impacted by one-timer, which was about 18 crores. Otherwise, the EBITDA margin was in the range of what we were declaring.

Sandeep Mantri: No. Deepak, unfortunately, this quarter was affected by one-timer, which was about INR 18 crore.

Ajay Rajan: Right.

Sandeep Mantri: The EBITDA margin was in the range of what we were declaring. It was consistent. We need to make some of these investments to create a better future for the company. Therefore, these costs are front-loaded, while the benefit of these investment or expense will come into the future. I'm not so worried about one quarter results, but I am more excited about the future which we are going to create for the company along with the leadership of Ajay.

Speaker #1: It was consistent. But we need to make some of these investment to create a better future for the company. Therefore, these costs are spent front-loaded while the benefit of these investment or spend will come into the future.

Speaker #1: I'm not so worried about one quarter's results, but I am more excited about the future that we are going to create for the company, along with the leadership of Ajay.

Speaker #3: So, Deepak, that's a very valid question from your side. And if you actually look at the whole way when I spoke in the first 30 minutes, you will find that every approach that I spoke about is towards making sure that we are moving from, A, a product approach to a solution approach.

Ajay Rajan: Deepak, it's a very valid question from your side. If you actually look at the whole way when I spoke about in the first 30 minutes, you will find that every approach that I spoke about is towards making sure that we are moving from a product approach to a solution approach. The primary reason for doing that is that enables us to do, A, onboard more customers, because when you are more curated, more customized, have a better proposition for the client. More importantly, we move from being a transactional engagement for the client to a more solution-driven strategic engagement to the customer, which enables our margin improvement. When you go and sell one product versus when you sell a bouquet of multiple products packaged as a solution, your stickiness, your margins, everything improves.

Speaker #3: And the primary reason for doing that is that that enables us to do A, onboard more customers because then you are more curated, more customized, have a better proposition for the client.

Speaker #3: But more importantly, we move from being a transactional engagement for the client to a more solution-driven, strategic engagement to the customer, which enables our margin improvement.

Speaker #3: So, when you go and sell one product versus when you sell a bouquet of multiple products packaged as a solution, your stickiness, your margins, everything improves.

Speaker #3: And that is really what the approach will enable. And that is how, at least in my three decades of banking experience, we have worked on doing that.

Ajay Rajan: That is really what the approach will enable. That is how, at least in my three decades of even banking experience, we have worked on doing that, and that's a very proven successful model. Second is the global business, and of course, helped by some of the inorganic partnerships and acquisition that I mentioned, will be aimed towards making sure that you are generating higher margin in geographies where there is a better price point for some of these solutions that we are going to do. Like Sandip very rightly mentioned, while of course, we do appreciate the fact that margins have pretty much been consistent or maybe to some extent deteriorated over the last few year.

Speaker #3: And that's a very proven and successful model. Second is the global business, and of course, helped by some of the inorganic partnerships and acquisitions that I mentioned.

Speaker #3: Will be aimed towards making sure that you are generating higher margin in geographies where there is a better price point for some of these solutions that we are going to do.

Speaker #3: So like Sandeep very rightly mentioned, while of course, we do appreciate the fact that margins have pretty much been consistent or maybe to some extent deteriorated over the last few years.

Speaker #3: But what we can definitely look forward with this new approach and Outlook is that we would like to double down on higher margin businesses and that hopefully should reflect very soon once the investment period is over in tangible financial outcomes for the company.

Ajay Rajan: what we can definitely look forward with this new approach and outlook is that we would like to double down on high margin businesses, and that hopefully should reflect very soon once the investment period is over in tangible financial outcomes for the company.

Speaker #1: And as explained in my earlier calls as well, I see the margins are going to improve substantially from here in the next two to three years.

Sandeep Mantri: as explained in my earlier calls as well, I see the margins are going to improve substantially from here in next two to three years. I think it will be a different margin trajectory.

Speaker #1: I think it will be a different margin trajectory.

Speaker #4: Got it. Got it. Got it. Okay.

Deepak Agrawal: Got it. Okay.

Speaker #3: If you look at the investor deck as well, you will find that the growth pillars clearly reflect the approach in terms of how we will grow and build our businesses.

Sandeep Mantri: if you look at the investor deck as well, you will find that the growth pillars clearly reflect the approach in terms of how we will grow and build our businesses. That is with single objective of making sure that our revenue and profit growth is justified. Rather than doing too many things, we will focus on few champion solutions and products which will be high margin, scalable, and globally deployable.

Speaker #3: And that is a single objective of making sure that our revenue and profit growth is justified. So rather than doing too many things, we will focus on a few champion solutions and products, which will be high margin, scalable, and globally deployable.

Speaker #4: Right. Right. So also, if you look at the e-seva cameras and we have been talking about we have rolled out over the last four months.

Deepak Agrawal: Right. Also when if you look at the Aadhaar Seva Kendras and we have been talking about, we have rolled out over like last four months. Again, from an investor context, that although obviously it's a large volume business, but the perception is it will generally be a substantially lower margin business, considering it is quite competitive, plus it's far more physical, right, compared to a product and a technology stack. Your thoughts there, sir. Can it become really big and is it that the margin there will be substantially lower?

Speaker #4: Again, from an investor context, that although obviously, it's a large volume business, but the perception is it is generally a substantially lower margin business considering it is quite competitive.

Speaker #4: Plus, it's far more physical, right, compared to a product and a technology stack. So your thoughts, is it like can it become really big and is it that the margins there will be substantially lower?

Speaker #1: The margin in other Seva cameras would not be substantially low, but as I said, we have to see how the volume picks up in Q3 or Q4, when these centers are stable and operational.

Sandeep Mantri: The margin in Aadhaar Seva Kendra would not be substantially low. As I said, we have to see how the volume picks up in Q3 or Q4 when these centers are stable and operational. There only we could really figure out what kind of margin we will earn. Having said that, I think these, as I earlier also said, these are not EBITDA accretive, at least they will generate sustainable stable margins in the business. Other aspect to that is that we have to create adjacencies out of some of these projects which will deliver higher and profitable opportunities for us.

Speaker #1: Then only we could really figure out what kind of margin we will earn. But having said that, I think these as I earlier also said, these are not EBITDA activity, but at least they will generate sustainable stable margins.

Speaker #1: In the business, another aspect to that is that we have to create adjacencies out of some of these projects, which will deliver higher and more profitable opportunities for us.

Speaker #4: Got it. Got it.

Ajay Rajan: Got it. Great, sir. Thank you so much.

Speaker #3: Great. Great, sir. Thank you so much. Thank you.

Ajay Rajan: Thank you. The next question is from the line of Vinil Shah from Dalal & Broacha. Please go ahead.

Operator: Thank you. The next question is from the line of Vinil Shah from Dalal & Broacha. Please go ahead.

Speaker #1: Thank you.

Speaker #2: Thank you. The next question is from the line of Vinil Shah from Dalal and Doja. Please go ahead.

Vinil Shah: Good evening. Thank you for the opportunity. Sir, my first question is that, as we have already mentioned that due to our higher upfront cost investment in Q1, we have had some margin impact. Are there any additional costs expected in Q2 and the balance of FY2027 as well?

Speaker #5: Good evening. Thank you for the opportunity. So sir, my first question is that, as we have already mentioned, due to our higher upfront cost investment in Q1, we have had some margin cut.

Speaker #5: So, are there any additional costs expected in Q2 and the balance of FY27 as well?

Speaker #1: None to my knowledge. The only thing which will have some temporary impact will be other Seva cameras; otherwise, I don't see any such one-timer going forward.

Sandeep Mantri: None to my knowledge. The only thing which will have some temporary impact will be Aadhaar Seva Kendra. Otherwise, I don't see any such one-timers going forward.

Speaker #1: So I think margin will get stabilized from Q2 or Q3.

Vinil Shah: Okay.

Sandeep Mantri: I think margin will get stabilized from Q2 or Q3.

Speaker #5: Okay. And sir, as I mentioned that now we are trying to transition toward a solution selling organization. So the booking of services that we are offering, like the DPI in a box and all.

Vinil Shah: Okay. Sir, as we have mentioned that we are trying to transition toward a solution-selling organization. The bouquet of services that we are offering, like the DPI-in-a-box and all. What is the internal timeline when the products will be ready? It will be outside the testing phase and ready for commercialization.

Speaker #5: So what is the internal timeline when the products will be ready? Like it will be out from the testing phase and ready for commercialization?

Speaker #3: So these are see, most of these products are already foundational products that we already are delivering, right? The DPI in the box will be a modular approach of positioning these or selling this to the state governments, to international markets, etc.

Ajay Rajan: Most of these products are already foundational products that we already are delivering, right?

Vinil Shah: Yes, sir.

Ajay Rajan: The DPI-in-a-Box will be a modular approach of positioning these or selling this to the state governments, to international markets, et cetera. In terms of delivery, it is an approach which we will sell and whenever deployment is required, it is immediately available for deployment. In terms, of course, the implementation timelines, which will obviously be there, but these are products and solutions that we have already built in some shape and form in various mandates that we have built so far.

Speaker #3: So in terms of in terms of delivery, it is an approach which we will sell. And whenever deployment is required, it is immediately available for deployment in terms of, of course, the implementation timelines which will obviously be there.

Speaker #3: But these are products and solutions that we have already built in some shape and form in various mandates that we have executed so far.

Speaker #5: Okay, sir. So, sir, are there any significant orders or customers that have already inquired about this? Are we seeing a good response from customers on this?

Vinil Shah: Okay, sir. Sir, any significant orders or customer that has already inquired about this and we are looking at a good response from the customers about this?

Speaker #3: Absolutely. Whether it is internationally or even in discussions that we are currently having with various states—large states—this approach is absolutely in line with what the governments expect.

Ajay Rajan: Absolutely. Whether it is internationally or even in discussions that we are currently having with various large states, this approach is absolutely in line with what the governments expect. The reason being, every state or government today would like to touch or improve the life of its citizens in every shape and form, right? Whether it is through a health solution or a agri solution or a DBT solution. When you go and provide an overall package to someone, obviously, there is high level of interest to look at that deployment, right? To your point, yes, there is interest when such approach is discussed, like every large implementation, there will always be a lead time in terms of pitch to conversion or pitch to agreement. It might also go through a RFP process and et cetera.

Speaker #3: The reason being, every state or government today would like to touch or improve the lives of its citizens in every shape and form, right?

Speaker #3: Whether it is through a health solution or a agri solution or a DBT solution so when you go and provide an overall package to someone, it is obviously there is high level of interest to look at that deployment, right?

Speaker #3: So, to your point, yes, there is interest when such an approach is discussed. But like every large implementation, there will always be a lead time in terms of pitch to conversion or pitch to agreement.

Speaker #3: It might also go through an RFP process, etc. But at a concept level, this is really where we see value—both from a government perspective, as well as from a company perspective, and, more importantly, from a citizen perspective.

Ajay Rajan: As a concept level, this is really where we see that both from a government perspective, as well from a company perspective, and more importantly, from a citizen perspective, such approach will become very meaningful and hopeful.

Speaker #3: Such approach will become very meaningful and wholeful.

Speaker #5: Great, sir. Thank you so much. And all the best for the future.

Vinil Shah: Great, sir. Thank you so much, and all the best for your future.

Ajay Rajan: Mansay, our CBO will also speak.

Speaker #3: One thing, our CBO will also make some. Attraction on the enterprise side that they talked about. We are getting very strong attractions there. The pipeline looks very good and very well placed.

Rakesh Doshi: Traction on the enterprise side that Rajesh talked about, we are getting very strong traction there. The pipeline looks very good and very well-placed. That's on the other enterprise side, where the composable layers have been created to offer as product solutions and journeys. On the government side, as you know, it's a mandate and RFP process that we are participating in, we are hopeful for some interesting wins soon.

Rakesh Dosi: Traction on the enterprise side that Rajesh talked about, we are getting very strong traction there. The pipeline looks very good and very well-placed. That's on the other enterprise side, where the composable layers have been created to offer as product solutions and journeys. On the government side, as you know, it's a mandate and RFP process that we are participating in, we are hopeful for some interesting wins soon.

Speaker #3: So that's on the other enterprise side. Where the composable layers have been created to offer a product solutions and journeys. On the government side, as you know, it's a mandate and RFP process that we have participating in.

Speaker #3: So we are hopeful for some interesting events soon.

Speaker #5: Okay, sir. Thank you.

Vinil Shah: Okay, sir. Thank you.

Speaker #2: Thank you. The next question is from the line of Manan Pallodiya from MKT Securities. Please go ahead.

Vinil Shah: Thank you. The next question is from the line of Manan Bhalodia from MKP Securities. Please go ahead.

Operator: Thank you. The next question is from the line of Manan Bhalodia from MKP Securities. Please go ahead.

Manan Bhalodia: Hi, sir. Thanks for the opportunity. I understand that you may not be able to provide the economics or the break-even for the Aadhaar Seva Kendra centers. My question is, with relation to the return on capital employed, even at the break-even level or even slightly above the break-even level, if you could quantify something. Secondly, if you could quantify the amount of working capital we would require to put into that business, even at the break-even level. I think that'd be really helpful, sir.

Manan Poladia: Hi, sir. Thanks for the opportunity. I understand that you may not be able to provide the economics or the break-even for the Aadhaar Seva Kendra centers. My question is, with relation to the return on capital employed, even at the break-even level or even slightly above the break-even level, if you could quantify something. Secondly, if you could quantify the amount of working capital we would require to put into that business, even at the break-even level. I think that'd be really helpful, sir.

Speaker #6: Hi, sir. Thanks for the opportunity. I understand that you may not be able to provide the economics or the break-even for the Aadhaar Seva Kendra centers.

Speaker #6: But my question is with relation to the return on capital employed even at the break-even level or even slightly above the break-even level, if you could quantify something and secondly, if you could quantify the amount of working capital we would require to put into that business even at the break-even level.

Speaker #6: I think that would be really helpful, sir.

Speaker #1: So are you talking about Aadhaar Seva Kendra project?

Ajay Rajan: Are you talking about Aadhaar Seva Kendra project?

Speaker #6: Yes, the Aadhaar Seva Kendra project.

Manan Bhalodia: Yes, the Aadhaar Seva Kendra project.

Manan Poladia: Yes, the Aadhaar Seva Kendra project.

Speaker #1: So because this is a managed operational project, so working capital will not be heavy in this except the initial furniture offices which we need to set up.

Ajay Rajan: This is a managed operational project, working capital will not be heavy in this, except the initial furniture, offices which we need to set up. Otherwise, this is a monthly recurring revenue. All the routine expenses except the CapEx part will be out of revenues.

Speaker #1: Otherwise, this is a monthly recurring revenue. And all the routine expenses except the Capex part will be out of revenues.

Manan Bhalodia: Sir, just a quick follow-up on that. Are you saying the billings from the government side are either on a monthly or a quarterly basis?

Manan Poladia: Sir, just a quick follow-up on that. Are you saying the billings from the government side are either on a monthly or a quarterly basis?

Speaker #6: Just a quick follow-up on that. So are you saying the billing from the government side are either on a monthly or a quarterly basis?

Speaker #6: Because I'm assuming when we are processing Aadhaar's front upfront costs are asked, right?

Ajay Rajan: Monthly.

Manan Bhalodia: when we are processing Aadhaar, the upfront costs are added, right?

Manan Poladia: when we are processing Aadhaar, the upfront costs are added, right?

Ajay Rajan: Monthly basis pay, we will bill on a monthly basis based on the volumes which are there for each month.

Speaker #1: Monthly basis pay—we will bill on a monthly basis based on the volumes which are there for each month.

Speaker #6: All right. Thank you, sir.

Manan Bhalodia: All right. Thank you, sir.

Manan Poladia: All right. Thank you, sir.

Speaker #1: And our experience also in I think we are getting money in time from government.

Ajay Rajan: Our experience also in, I think we are getting money in time from government.

Speaker #6: All right. Thank you.

Manan Bhalodia: Okay. Thank you.

Manan Poladia: Okay. Thank you.

Speaker #1: Thank you so much.

Ajay Rajan: Thank you so much.

Speaker #2: Thank you. The next question is from the line of Bhavi i Chauhan from Care PMS. Please go ahead.

Ajay Rajan: Thank you. The next question is from the line of Bhavi Chauhan from Care PMS. Please go ahead.

Operator: Thank you. The next question is from the line of Bhavi Chauhan from Care PMS. Please go ahead.

Speaker #7: Thanks for the opportunity. Just two questions from my side. The first one is related to the other entity business. That has witnessed a significant increase in this quarter.

Bhavi Chauhan: Thanks for the opportunity. Just two questions from my side. The first one is related to the other entity business that has witnessed a significant increase in this quarter. Could you provide that which segment have contributed to this?

Speaker #7: Could you provide that which segment have contributed to this?

Speaker #1: You are talking about new.

Ajay Rajan: You are talking about new initiatives or?

Speaker #7: Other entity business. Yeah, new initiatives. I'm talking about the other business, which has grown from ₹11 crore to ₹44 crore, or ₹42 crore, in this.

Bhavi Chauhan: Other entity business. Yeah, new initiatives. I am talking about the other business which have been grown from INR 11 crores to INR 42 crores in Q4.

Speaker #1: This is primarily because of the one RFP mandate some revenue recognized because of that. Second one is Aadhaar. Wherein we started recognizing the revenue.

Ajay Rajan: This is primarily because of the one RFP mandate, some revenue recognized because of that. Second one is Aadhaar, wherein we started recognizing the revenue. Third one is our new product, like eSignPro or eSignPro, where we started gaining some traction and therefore the revenue is there.

Speaker #1: And third one is our new product like Rice with Protein or Essence Pro where we started getting some traction and therefore the revenue is there.

Speaker #1: So these.

Speaker #7: Could you quantify this? How much from.

Bhavi Chauhan: Could you quantify that? Like how much from

Sandeep Mantri: I can't give a quantification or further breakdown of new initiatives, because we are not disclosing any sub-segment for these. These are the three key services within new initiatives which has resulted into a INR 42 crore revenue.

Speaker #1: I can't give a quantification or further breakdown of new initiative. Because we are not disclosing any sub-segment for these. But these are the three key services within new initiative which has resulted into a 42 crore revenue.

Speaker #7: Okay. And the second question is related to the geopolitical issue which has been impact. Is the margin so like if I look at the financials, the system implementation and support maintenance expense have been grown significant.

Bhavi Chauhan: Okay. The second question is related to the geopolitical issue which has been impacted the margin. If I look at the financials, the system implementation and support maintenance expense have been grown significantly. Is this related to the geopolitical issue? That I am not able to understand that how this cost is increasing related to.

Speaker #7: So is this related to the geopolitical issues? So what that I am not able to understand that how this cost is increasing related to this.

Speaker #1: Yeah. A part of this increase is because of geopolitical price increase in various hardware, software, and technology product.

Sandeep Mantri: Yeah. A part of this increase is because of geopolitical price increase in various hardware, software, and technology products.

Speaker #7: So that is only the reason, right?

Bhavi Chauhan: That is only the reason, right?

Speaker #1: Yeah, that is the only reason.

Sandeep Mantri: Yeah, that is the only reason.

Speaker #7: And so like excluding that, you have said that the 18 crores EBITDA 18 crores is impacted on the EBITDA.

Bhavi Chauhan: Excluding that, you have said that the INR 18 crore is impacted on the EBITDA.

Speaker #1: 18 crore is impacted on the EBITDA because we at your accounting rules, we have to take these cost upfront. We can't. For these cost.

Sandeep Mantri: INR 18 crore is impacted on the EBITDA because as per accounting rules, we have to take these costs upfront. We can't cover these costs based on future revenues.

Speaker #1: Based on future revenues.

Speaker #7: Okay, okay, okay. Thank you. That's it from my side. Thank you.

Bhavi Chauhan: Okay. That's it from my side. Thank you.

Speaker #1: Thank you so much, Bhavi.

Sandeep Mantri: Thank you so much.

Speaker #2: Thank you. Reminders for all participants: please press star and one to ask questions. Participants who wish to ask a question, please press star and one.

Sandeep Mantri: Thank you. Reminders for all participants. Please press star and one to ask questions. Participant who wish to ask a question, please press star and one. As there are no further questions from the participants, I hand the conference over to Ms. Pushpa Mani for closing comments.

Operator: Thank you. Reminders for all participants. Please press star and one to ask questions. Participant who wish to ask a question, please press star and one. As there are no further questions from the participants, I hand the conference over to Ms. Pushpa Mani for closing comments.

Speaker #2: As there are no further questions from the participants, I hand the conference over to Ms. Pushpamani for closing comments.

Pushpa Mani: Thanks, Tanya. On behalf of Protean, I would like to thank you all for taking time out and also for your continued trust and support in us. We remain committed to delivering growth and value to our stakeholders. For any additional questions, please feel free to reach out to us and we look forward to staying connected. Thank you.

Speaker #4: Thanks. Thanks, Samya. On behalf of Proteam, I would like to thank you all for taking time out and also for your continued trust and support in us.

Speaker #4: We remain committed to delivering growth and value to our stakeholders. For any additional questions, please feel free to reach out to us and we look forward to staying connected.

Speaker #4: Thank you.

Speaker #1: Thank you. Thank you.

Sandeep Mantri: Thank you.

Sandeep Mantri: On behalf of Go India Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

Operator: On behalf of Go India Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

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Q1 2027 Protean eGov Technologies Ltd Earnings Call

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