Q1 2027 Veefin Solutions Ltd Earnings Call
Speaker #1: Good day, ladies and gentlemen. And welcome to the Weefin Solutions Ltd. Q1, FY27 earnings conference call hosted by Vellorum Advisors. At this point, all participants are in a listen-only mode, later we'll conduct a question-and-answer session.
Speaker #1: At that time, you may click on the Q&A tab to ask a live question. Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Parvangi Jain from Vellorum Advisors, for her opening remarks.
Speaker #1: Thank you, and over to you, Ms. Jain.
Speaker #2: Thank you. Good afternoon, everyone, and a very warm welcome to you all. My name is Parvangi Jain from Vellorum Advisors. We represent the investor relations of Weefin Solutions Ltd. On behalf of the company, I would like to thank you all for participating in the company's earnings call for the first quarter of the financial year ended 2027.
Speaker #2: We kindly request all participants to connect to the Weefin Solutions video conference call via the official video call link. Before we begin, let me mention a quick cautionary statement: some of the statements made in today's earnings call may be forward-looking in nature.
Speaker #2: Such forward-looking statements are subject to risk and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by, and information currently available to the management.
Speaker #2: Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's earnings conference call is purely to educate and bring awareness about the company's fundamental business and financial performance for the quarter under review.
Speaker #2: Now, let me introduce you to the management participating with us in today's earnings call. We have with us Mr. Raja Devnath, Chairperson and MD, Mr. Gautam Udhani, whole-time director and COO, and Mrs. Payal Maheshari, CFO.
Speaker #2: Without any delay, I request Mr. Raja to start with his opening remarks. Thank you, and over to you, sir.
Speaker #3: Thanks, Parvangi. Good afternoon, everyone, and a very warm welcome for from Weefin Solutions for the first quarter 2027 earnings call. I have with me my colleagues, my leadership team, and thank you all for taking time today.
Speaker #3: The presentation that I will walk you through has already been filed with the exchanges. It's available on our website, so you can follow along if any of you have joined just on the calling bridge.
Speaker #3: Before we get into the numbers, let me set the frame of this call. Because the cover slide says this only on one line, that building a global multi-product BFSI tech platform.
Speaker #1: 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 #3: What is it that we have been doing? For people who have been following us for the last few years know that the work which has gone in, which is building products building the common chassis which we speak about, building a client base, the geographic footprint, all of this is getting culminated in FY27 is a critical year for us where this agenda of building is shifting decisively towards monetizing this platform.
Speaker #1: Should you need assistance during the conference call, please signal an operator by pressing 'star' then '0' on your touch-tone phone. Please note that this conference is being recorded.
Speaker #1: I now hand the conference over to Ms. Somya from Go India Advisors LLP. Thank you, and over to you, ma'am.
Speaker #3: So today I will tell you the story in three parts. First, I'll talk about the quarter itself, and it has been a very strong quarter.
Speaker #2: Good day, everyone, and welcome to the Q1 FY27 conference call of Veranda Learning Solutions Limited. We have with us on the call Mr. Suresh Kalpati, Chairman and Executive Director, and Mr. Mohsin Khan, the Chief Financial Officer.
Speaker #3: It has been a strong quarter in terms of a standalone revenue growth, and profit both of which have doubled over last year. Second, the commercial engine underneath.
Speaker #2: We must remind you that discussion on today's call may include certain forward-looking statements and must therefore be viewed in conjunction with the risks pertaining to the business.
Speaker #3: What is it that we have signed this quarter? How are wins convert into revenue over time? Because this is a question which keeps coming up, so I thought that I'll take some time out and explain how to convert our wins into revenue over time and how to visualize it.
Speaker #2: I now request the management to take us through the business update, and after that, we'll open the floor for Q&A. Thank you, and over to you, sir.
Speaker #3: Thank you. Thank you, Somya. Good afternoon, everyone, and thank you for joining us today. On behalf of the entire leadership team, I sincerely appreciate your continued engagement and confidence in Veefin Solutions.
Speaker #3: And what is the pipeline that we are building behind it? The third is the structural work, which is the balance sheet, we'll talk about the amalgamation, and we'll talk about the PSB exchange.
Speaker #3: Before I talk about our performance, a word on the environment we are operating in. India's education and skilling landscape continues to see structural tailwinds: growing emphasis on employability-linked learning, rising aspirations for competitive government examinations, deeper penetration of a digital-first delivery model, and, of course, an increasing willingness among students and parents to invest in outcome-oriented programs.
Speaker #3: Now, this is the way we'll go about. Now, if you start with the quarter at a glance, you will see two rows on this slide.
Speaker #3: Standalone and console. And throughout this presentation, these are the two lenses that you will have to look at our numbers with, and I'll keep bringing you back to this.
Speaker #3: The top row is Weefin Solutions Ltd. standalone. Now, this is the listed entity. And this is the purest lens for product economics. So from a product economics standpoint, okay, what you should be looking at is the revenue for this quarter was a 23.14 crores.
Speaker #3: Whether it is in commerce, academics, or in test prep, this continues to validate the direction of our Veranda 2.0 strategy, which, as you know, has been built around scalable, asset-light delivery of high-quality, outcome-driven education.
Speaker #3: Now, against this backdrop, we are pleased to report a strong start to financial year '27. We delivered broad-based momentum across our portfolio in the first quarter of this year.
Speaker #3: The standalone EBITDA was 12.83 crore. And I'm reading out the numbers because I believe some of you may just may not have the presentation in front of you.
Speaker #3: So I will still read out the numbers. The standalone PAT is at 6.74 crores. And we have also signed five new clients this quarter.
Speaker #3: Led by exceptional performance in the commerce and government test prep businesses, our K-12 business segment continues to strengthen its foundation through investments in systems, partnerships, and brand building.
Speaker #3: So we'll come on that also. The standalone EBITDA is at 12.83 crores at a margin of 55.4%. Now, cameras warning, meeting has reached maximum number of cameras.
Speaker #3: That, we expect, will translate into stronger growth over the coming quarters. On the revenue front, the revenue from operations grew a strong 42% year-on-year to about ₹150 crore in the first quarter of financial year ’27, while PAT more than multiplied six-fold to ₹34 crore compared to the same quarter last year.
Speaker #3: I don't know what that means. Okay. So going back to this, our standalone EBITDA is reported at 12.83, which is at a 55.4% margin.
Speaker #3: Up 472% year-on-year from ₹5.9 crores in the first quarter of FY26. Our sixth consecutive quarter of PAT positive performance. Overall enrollments during the quarter grew 35% year-on-year to about 1.3 lakh students, while collections grew 27% year-on-year, reflecting healthy demand and robust execution across all our business segments.
Speaker #3: Okay. The standalone PAT, which is there, that has a 29.1% margin. On the console side, that's includes our subsidiaries and our other group entities.
Speaker #3: There, the revenue is at 113.97 crores. And the console EBITDA is at 22.4 crores at a 19.7% margin. Here you will also see our PAT of 9.5 crores at a 8.3% margin.
Speaker #3: Each of these segments is being driven by distinct, well-defined growth levers. In commerce, we recently launched Commerce Virtuals, a live and recorded digital delivery format for Class 11 and Class 12 students, giving us pan-India reach without additional critical infrastructure, while continuing to expand our offline network.
Speaker #3: The qualified pipeline, an important number here, is at 80.13 million. That's where we are at end of the quarter. And we'll spend proper time on the on the pipeline towards the end of the presentation.
Speaker #3: It now spans, incidentally, over 105 centers, with 15 new commerce colleges in the pipeline for management. This segment continues to be our category leader, holding the number one market position across CACS, CMA, ACCA, and many other programs that we already offer.
Speaker #3: One thing to notice here, right up front, and I think you will have questions on this, is the console margins look very different from the standalone margin.
Speaker #3: And that is not a that is a structure, actually. That is not any deterioration of margin. That is the structure, the way it is, because the Weefin product business and the subsidiaries have a very different profile of the business itself at their margins are different.
Speaker #3: In the government test preparation space, growth was driven by the launch of our new offerings, including Group 1 offline programs, Junior IAS for students in schools and final years, and subscription-based magazines, alongside our raised platform network of centers and a diverse exam portfolio spanning UPSC, SSC, Banking, Tamil Nadu Public Service Commission, Kerala Public Service Commission, and other state public service commission exams.
Speaker #3: So when you're looking at the Weefin numbers, use the standalone lens to judge the product economics. And look at the console from the full statutory perimeter as such.
Speaker #3: Okay. And what is the shareholder attribution? Look at it only from that point of view. You see, at the bottom, we have also put the third-party regulations of our player for investors.
Speaker #3: In academics and K-12, we continue to build out our managed schools opportunity, the large underpenetrated market worth over ₹10 lakh crore across just South India.
Speaker #3: We have joined the call who don't know Weefin as much. The key thing here is IBSI sales league table, global sales league table, ranked us as number one in wholesale transaction banking.
Speaker #3: We currently manage six schools with over 5,400 students on an asset-light, end-to-end managed services model, and are targeting to expand the number of schools that we manage, supported by steady occupancy and fee growth dynamics in the coming years.
Speaker #3: Euromoney awards 2025. We were awarded as the most innovative software provider. And we are industry leader again. In both editions of the IBSI supply chain finance spectrum.
Speaker #3: Now, these are important because this is not our claim. This is what the industry independent assessments talk of Weefin. And this these are the kind of recognition that clients look for when they're signing up with us.
Speaker #3: Steering now to the commerce demerger process, we continue to make good progress and remain on track. The Board approved the Composite Scheme of Demerger in late 2025, and we subsequently filed the scheme with NSE and BSE, receiving their No Objection Certificates from both exchanges in January 2026.
Speaker #3: Moving on to Weefin if there's one sentence I can sum this slide up in, it's that the install base is 50 plus installations. We have close to 47 billion dollars of transactions which are flowing through the platform on an annual basis.
Speaker #3: Following the NCLT-directed convene meeting in March, shareholders voted in favor of the scheme, and the convene meeting was held in April. We filed the second motion with the NCLT with all appropriate papers that same month.
Speaker #3: The next NCLT hearing is scheduled in Chennai on 17 August, which is coming Monday. We expect the entire process to be completed by possibly the first half of September 2026, which is next month.
Speaker #3: And we are present in 16 countries. And we have 10 products which have been already deployed on this platform. So the key the key line here is that 50 plus institutions, 16 countries, and all of this installed base which is there, this is the base which is actually providing us the revenue year on year.
Speaker #3: For completion, JK Shah Commerce Education Limited will be separately listed, with every Veranda shareholder receiving one share in the newly listed entity on a 1:1 basis at no additional cost.
Speaker #3: So every time we add new clients, they get added to this base of clients that we have. New clients will give us revenue. The old clients will continue giving us revenue.
Speaker #3: Enabling shorter strategic focus, more efficient capital allocation, and long-term value creation for all our shareholders. Post-demerger, the commerce business will target significant revenue growth over the next three to four years, through product and geographic expansion, with a long-term aspiration of crossing ₹1,000 crore of revenue by September, by financial year 2030.
Speaker #3: So that is the most critical thing here. The other piece is that all of these products are being modeled on the Weefin 4.0 architecture.
Speaker #3: We will spend some time ahead on it. And that's very critical because that's one of our core moat which is there. Our architecture. So we are not building multiple products in parallel.
Speaker #3: Our strategic priorities and outlook for FY27—our focus is clear and forthright: expanding our government test preparation business into Karnataka to tap the state-level competitive exam market; entering the preschool managed operations space to deepen our K-12 value chain and build early brand relationships; expanding our offline commerce college network into an additional 50 new locations that we will manage; and establishing an offline presence in the North and West of India.
Speaker #3: We are building all of these products on the same chassis. Okay. And there's a lot of reusability which is there between all of these products.
Speaker #3: This this slide is the actual investment thesis of the company. All in one page. So let me spend a minute here. Right at the top, what you see is the monetizing products.
Speaker #3: So all Weefin products that we saw till now, they're classified in three different layers. Right at the top is your supply chain finance and LOS.
Speaker #3: Targeting specifically UP, Bihar, Rajasthan, and Gujarat. To reduce our regional concentration and unlock a large undeserved student base. Overall, it's worth stepping back to look at the journey that has brought us here, with just want to conclude by saying that Veranda's revenue has grown from just 3 crores in FY 21 to 481 crores in FY 26.
Speaker #3: These are these are our most mature products. That's where we have a 50 plus financial institutions and the 47 billion annual disbursement that you see.
Speaker #3: That is on these platforms. These are the platforms which are live. These are the platforms where our clients are paying us month on month, year on year.
Speaker #3: With total enrollments growing from under 29,000 to over 2.56 lakh over the same period, this growth was built through Veranda 1.0—a phase of aggressive brand and capability acquisition, including CA and UPSC course launches, the Eduveka acquisition, our BSE and NSE listing in April 2022, and the acquisition of JK Shah Classes, Tapasya, and several other organizations.
Speaker #3: Okay. The and the the next ones are our products which are our NP differentiated products which are your LMS collections, fraud and risk, the GenAI products.
Speaker #3: These are the products that we used to deepen our relationship with the clients. And many a times, these are these also become our cross-selling entry points.
Speaker #3: So a client may want just a GenAI point solution. We get in using that. And then the other products will follow through. These products, they actually increase the share of wallet in an account.
Speaker #3: We have now transitioned, as I had mentioned in the past, into Veranda 2.0—a phase focused on consolidation, de-leveraging, and profitable scale. This phase is marked by our maiden QIP and the proposed commerce demerger.
Speaker #3: And they also increase share of mind space in an account because then you're talking with your banks and your counterparts in the banks, not on one product, but you're talking of multiple products.
Speaker #3: The divestment of our occasional segment to SMVA Veranda in September of last year, and continued progress on the Commerce demerger process through FY26.
Speaker #3: You are that much more deeply entrenched in the bank. The third layer is the strategic IP. And this is where a lot of investments has gone in over the last few years, which is on your trade finance, cash, management, liquidity management, corporate internet banking, retail internet banking.
Speaker #3: Taken together, these priorities underpin our FY27 guidance of approximately ₹670 crore in revenue, over ₹50 to ₹50 crore in EBITDA, and about ₹140 crore in profit after tax.
Speaker #3: Now, these are these are large enterprise systems. And these have long-term monetization potential. Now, this is what changes the product relationship into a enterprise relationship because now you then have larger transformation deal that you go after.
Speaker #3: And the position says, well, to deliver sustainable, profitable growth and long-term value for all shareholders. I would now request Mohsin to take you through the financial performance in detail for the quarter. Over to you, Mohsin.
Speaker #3: Your client tenures become even longer. And the lifetime value is much higher. And we are seeing that as we are signing deals, we are seeing that.
Speaker #2: Thank you, Professor. The broad term is shareholders. Thanks for joining. Let me take you to the financial performance for Q1 FY27. Revenue from operations for Q1 FY27 stood at ₹150 crore, up 42% year on year, supported by strong business momentum across commerce, government, test prep, and academic segments.
Speaker #3: So underneath all of these layers is your shared architecture, reusable services, common APIs. I will show you I'll show you what this exactly means.
Speaker #3: And because of this, what it actually happening in terms of our thesis. So if you look at the the part that this is the culmination of what I was just talking about.
Speaker #2: EBITDA for the quarter came in at ₹54 crore, registering 10% year-on-year growth, reflecting an EBITDA margin of approximately 36%, and continued disciplined cost management.
Speaker #3: Okay. So we are not naming clients here because we are there are confidentiality requirements which we have. But these are some of the flagship deals that we have signed in the first quarter.
Speaker #2: Tax for the quarter increased sharply to ₹34 crore, up 472% year-on-year from ₹5.9 crore in Q1 of last year, marking this as our sixth consecutive quarter of broad positive performance.
Speaker #3: Look at the first one. It is one of the largest digital banks in the GCC. And there we have sold six products. We were all talking about right now cross-sell entry points, larger tickets, larger ticket size, larger wallet share.
Speaker #2: On a segment-wise basis, how we're reporting, commerce test prep delivered a revenue of 108.6 crores, out of 53% year on year. With EBITDA of 42.7 crores, up 58% year on year.
Speaker #3: Exactly. One deal gets you LOS, LMS, collections, trade finance, supply chain, and a limits microservice. Now, limits microservice is usually a core service which sits within the core bank itself.
Speaker #2: Translating into an EBITDA margin of around 40%, underlining the segment's strong and improving profitability. Government test prep revenue grew 41% year-on-year to ₹32.5 crore, with EBITDA improving to nearly ₹4 crore from near breakeven level in the previous quarter.
Speaker #3: Here, this has been removed from the core bank and has been handed out to Weefin. If you see this, this is not a a tech point solution purchase.
Speaker #2: The academic segment posted revenue of ₹12.2 crore, up 22% year on year, with EBITDA of ₹9.2 crore, which is up by 53% year on year.
Speaker #3: This is basically a platform decision that the bank has taken by saying, "I would rather move everything that I have and I need onto one Weefin platform." So that's really heartening for us.
Speaker #2: As the Professor was saying, for FY27 we are projecting revenue of approximately ₹670 crores, with EBITDA of ₹260 crores and PAT of ₹140 crores.
Speaker #2: Compared to last year, with ₹482 crore of revenue, ₹204 crore of EBITDA, and ₹130 crore of PAT respectively in FY26. Within this, we expect the commerce business to contribute annual revenue of approximately ₹40 crore, with EBITDA of around ₹21.5 crore and PAT of around ₹11 crore.
Speaker #3: The second one, very similar, is again some non-bank company in the Middle East which now takes LOS, LMS, and collections, all three. It's a full lending stack that they're going for.
Speaker #3: Not one product per vendor. All three products from the same vendor. Again, they'll they chose us because they like the fact that we were all on the same single stack.
Speaker #2: While the non-commerce businesses are expected to contribute revenue of approximately ₹220 crores, with EBITDA of ₹46 crores and PAT of ₹34 crores, based on our current business plan and historical quarterly trends.
Speaker #3: The third one is a supply chain finance. Supply chain finance which across five countries in Africa. One single deal shown as five countries both for supply chain and LOS.
Speaker #2: Collections and cash flows remained healthy throughout the quarter, and our balance sheet continues to strengthen following the delivery initiative undertaken over the past year.
Speaker #2: As we look ahead, we remain focused on disciplined expansion across our core verticals, as we planned earlier. This will be supported by new geography launches, scaling of offline centers, new course introductions, improving digital-led admissions, tying up with more institutional partnerships, and continuing operating efficiencies.
Speaker #3: That's what we are doing. So if you look at the scope, what is it? It's five new clients signed in the quarter. Largest single win with six products at one shot.
Speaker #3: Okay. 15.27 million dollars of wins of the qualified pipeline. Remember last time we had shown the qualified pipelines out of that, 15.27 million has these five deals put together which have got converted.
Speaker #2: So we have closed the quarter in line with guidance. This is from the quarterly performance. So now you can take it.
Speaker #3: And five countries in one single rollout. So this is a single rollout that we'll be doing with five countries. Now, the takeaway therefore is very clear.
Speaker #3: That Weefin is now increasingly being bought as a platform, not as a single product. And this therefore changes the deal size. It changes the tenure.
Speaker #3: And it changes the quality of revenue that we provide. This is the this is a new slide. We have not used this ever in the past.
Speaker #3: But let me therefore take some time and explain one second. I got a message. My camera was turned off. So yeah, it's turned on again.
Speaker #3: Okay. So this slide, let's take some time here and understand this slide. When we go deeper into the this this slide which is there, how do signings get converted to revenue?
Speaker #3: Now, we get this question a lot. Now, how do the signings get converted to revenue? Now, if the signings are strong, like if it's 15.27 million, when can you see it in revenue?
Speaker #3: And that's what many people want to model. So I want all of you all who are here to actually internalize this very well. So typical enterprise deal that we are in will have revenues coming from three places.
Speaker #3: Okay. First is the implementation fee. Right at the top. Now, that is a one-time thing. Now, that is something which will trickle and build implementation fees is build on milestones.
Speaker #3: So it there could be some money right upfront on signing. There'll be some money on certain milestones that you will have then over a period of the journey of implementation.
Speaker #3: So our standard implementation, assuming it's a nine-month implementation, will therefore see that we get implementation fees which is a one-time fee coming in the first nine months.
Speaker #3: Okay. Starting from signing and concluding at go-live. Once this is done, then post that is usually the second set of fees which are the license fees.
Speaker #3: Now, license fees could be your SaaS, AUM-based fees, license fees could be a monthly recurring. It could be an annual recurring, quarterly recurring. We know there are various types.
Speaker #3: That fee starts post the system goes live. So now we are in nine to 12 months, 15 months period. Now, this period which is there, which is the the next nine months, from the go-live, that is when you start seeing a ramp up of numbers.
Speaker #3: Whether it's the client has a existing business, that has to get migrated. The migration activity will happen. If they have an existing book, that will have to get transferred here so that we start seeing revenues.
Speaker #3: So the second line the license is basically build annually, quarterly, monthly. But that's a recurring fee which now starts. The third type of fees that you then now get is your AMC and support fees.
Speaker #3: That will usually start from year two onwards because year one you don't charge AMC. Year two onward you start AMC. And that's again recurring.
Speaker #3: AMC is annual maintenance contract. That starts from year two onwards. So what you're seeing here, a deal that I signed today starts paying me fees right from now till 21 months right upfront and then will extend the the license fees and the AMC fees will extend to four to seven years depending on the contract period.
Speaker #3: So when we explain now, let's go back and see when I say a 15.27 million dollars worth of deals we have closed in quarter one.
Speaker #3: It means they will all go through the similar cycle. There'll be a chunk of that which come through implementation in the first nine months.
Speaker #3: Then the license and the AMC depending on the contractual obligations there, will start flowing for the contract period. All of these contracts that we have signed are five-year periods.
Speaker #3: So you will see these revenues over the next five years. And the most important thing which is there is what is critical. Today, the revenues that you are seeing therefore they are revenues which are deals that we had signed in 24.
Speaker #3: These are all FY24 deals. FY25 deals money of that is what you are seeing right now. Similarly, what we are signing now, therefore sees to it that our FY28, 29, the annuity base at that point in time is taken care of what we are doing right now.
Speaker #3: So when you are modeling Weefin, therefore you should model Weefin in terms of cohorts. Not just a quarter. An annual cohort is what you should be looking at.
Speaker #3: That's how what will make the most sense for you. And these dates that I've given you, these are indicative timelines. Like when I'm saying nine months, it's not nine months.
Speaker #3: There are customers who go-live in three months also. There are customers who go-live in five months also. But I'm saying depend because now we are moving into a territory of large deals.
Speaker #3: So therefore you may have a situation where you will have a longer implementation period also. This is about standalone the how to read between Weefin numbers.
Speaker #3: I said that there are two lens which are there. I'll just re-trade this again because this keeps coming back again and again. So I've taken taken the liberty of adding a slide here.
Speaker #3: That standalone tells you the product economics. The console will tell you the statutory parameters. So both lens are important. But when you're going through the financials, use two separate lenses.
Speaker #3: If you want to ask how is Weefin as a product company doing, look at standalone. How you as a shareholder want to look at Weefin, then look at the console numbers.
Speaker #3: Moving on to the numbers, the first what we'll do is we'll look at the standalone numbers year on year. If you look at the standard numbers year on year, your Q1 at 23.14 crore vis-a-vis 10.14 is at 128% jump.
Speaker #3: So revenue has grown 128%. Your reported EBITDA from which is there which is 12.83 crore against 5.49 crore. That's a 133% jump out there.
Speaker #3: And your PATH which is there at a 6.74 crore against a 2.68 crore last year, which is a 151% jump. So just look at the sequence.
Speaker #3: Your revenues are 128%. Your EBITDA is up 133%. And PATH is a 151%. Now, each line is growing faster than the other. And this is the operating leverage that we keep speaking about.
Speaker #3: Okay. Your EBITDA margins have improved. The takeaway is very simple. On a standalone level, the revenue EBITDA and PATH have more than doubled versus last year.
Speaker #3: And the margins have also expanded. The margins have also expanded while doing that. So growth at Weefin is compounding. So that's the story that you take away from this slide.
Speaker #3: Okay. If you look at the standalone revenue quality, now that's again extremely important because the quality of growth revenue is growing. That's great. But what about the quality of growth?
Speaker #3: If you see this, in the revenues, recurring is 74%. So from existing clients, our recurring revenue is 74% here. One-time revenue is 26%. So that's the stickiness that we talk keep talking about.
Speaker #3: On the client mix that you see, 77% of the revenues came from our existing clients, our old clients. Okay. Only 23% came from new clients.
Speaker #3: Now, when you read that with the five new clients that we added this quarter, what it means is the existing clients will keep buying more and our cross-sell thesis is validated from this.
Speaker #3: On the geography side, we are close to 50/50 between domestic and international. So that's a it just shows that we are not dependent on any one geography.
Speaker #3: We are very well spread out. And on the pipeline slide also, you will see that that much more. We've added this slide because we keep hearing we keep feeling questions on the DSO.
Speaker #3: So if you see the DSO trend, so we mapped out the DSO trends over the last few years. Like FY24, 25, 26, 27. So you see FY27 is actually at 80 days.
Speaker #3: It's a 69 days improvement over FY24. Every year, we have been improving. So what you are seeing right now is that while revenue is growing and you're seeing that revenue is growing very fast, so despite a very fast growth in revenue, more than 100%, 128% growth in revenue, our DSOs are coming down.
Speaker #3: That means we are able to collect money faster. And you remember I had I had explained this earlier also to you. That as we keep growing, as we keep as a company becoming stronger, we will then be in a position to start asking our clients to pay us faster.
Speaker #3: So 80 is it a good number? I think it's a brilliant number. In our planning that we do in our internal planning, we plan for more close a number which is closer to 100.
Speaker #3: A 100, 105 number is what we actually aim for. But we have actually done better than that number. Our receivables are moving extremely well.
Speaker #3: Collection discipline is also tightening as we speak. And you have seen the detailed operating cash flow disclosure will be there with the statutory statements.
Speaker #3: Moving on to what is mandatory. So this is the Q1 performance versus Q4. Now, Q4 is usually the best quarter of the year. It's usually the highest quarter of the year.
Speaker #3: But even if you see us vis-a-vis our Q4 numbers, we have nearly touched our Q4 numbers here. So revenue is nearly there. It's just 4% below the Q4 numbers.
Speaker #3: Our EBITDA is just 7% shy of that. Again, because of the revenue numbers out there. Our reported PATH, though, is higher because of various other reasons.
Speaker #3: Because our deposition is lower. Finance cost is lower out there. But but the key point is that our revenues are tracking our Q4. So it means that our base itself is higher.
Speaker #3: So I was just looking at some numbers. Our if you look at our average of last year, our Q1 is already 33, 34% higher than the average of the entire last year.
Speaker #3: Okay. At a quarter on quarter basis. So that's very healthy. It just shows that we are at a different orbit when it comes to 27.
Speaker #3: If I move to the console numbers, console numbers, obviously much higher. Because on the revenue side, our console is no. No, no. One second.
Speaker #3: I'm actually let me see which slide was it. Standalone. Let me come to console. This is okay. This is the console which we have vis-a-vis last year.
Speaker #3: So that's the reason why it's that much higher. So 230% growth. You see over last year. Revenue is more than tripled. Your EBITDA has grown your by more than 100% here.
Speaker #3: Your reported PATH is close to 40% higher than last year. Now, these numbers were obviously higher because we didn't have the entire console effect coming in in Q1 of last year.
Speaker #3: That's the reason these numbers are that much higher. But if you now look at the Q1 performance of the Q1 console performance, vis-a-vis Q4 of last year, so.
Speaker #3: Is just 13% short of it. So though Q4 was our largest quarter, it was usually traditionally in our services business, Q4 is the largest quarter.
Speaker #3: But despite that, we are very close. We are just 13% shy of that. The PATH numbers which are there, they are 40% lower. Out here, as you will see, but that is normalization.
Speaker #3: So why why Q2, Q3, you'll see these numbers change because Q1 is usually the slowest quarter of the year for us in our services line of the business.
Speaker #3: So again, look at the both lens. Product lens, standalone, which is the core product. When you look at and you look at that, it sequentially growing.
Speaker #3: PATH is growing. When you look at the console basis, there, your Q1 is obviously lower than Q4. But Q4 is obviously the biggest quarter in the services side of the business for us.
Speaker #3: So nothing to worry about out there. Very busy slide. Very busy slide. But can't help it. But you need to understand this. Because if you're an investor in VFIN, this is what you have pumped in your money for.
Speaker #3: Everything that you see on this slide, everything, other than the last line at the bottom, the gray line, external systems, is not us. Everything else on this slide is VFIN.
Speaker #3: So right from channels. So what you see channels on top, which is your corporate. Banking, retail banking, mobile banking, APIs, marketplace channels, all of those are provided by VFIN.
Speaker #3: If you look at the bottom, which is the common layers those are all, again, the common layer the data layer the super dash, which is the the the intelligence layer that we have, the vector, which is the low code, integration orchestrator, all of these are common to all of these products that you see.
Speaker #3: Your cash, supply chain, trade, digital lending. Your channels right at the top, which is your corporate internet banking, retail internet banking, your bottom this part, which is these are called the common user services.
Speaker #3: All these common services are used by all of these player all of these systems across. So like a Lego block, we have all played with Lego blocks as kids.
Speaker #3: Like a Lego block, bank can pick and choose any of these blocks from here. All of the blocks are below follow. So that is the reason why we are able to deploy products faster.
Speaker #3: That is the reason why we have higher margin. That is the reason why our clients are choosing us because of this architecture that makes their life simpler.
Speaker #3: When the central bank comes and makes a change, in any customer classification, the bank doesn't need to go and change the customer classification across all of the customers in each of the different systems.
Speaker #3: If they were to work with VFIN. You saw the bank in GCC. The reason they chose us is that when they make a change, they would like to make a change only in one place, not in 10 different systems.
Speaker #3: They are not then held hostage by the slowest moving tech vendor. But by a vendor who's moving at the same pace across all the products.
Speaker #3: Moving on. Amalgamation. This is again something which is a very critical thing for us. So in the seven-step process, we have completed four steps.
Speaker #3: We are now at the fifth step. Now, which was the first four? BSE approvals, the NCLT first motion, the stakeholder meetings have happened, got the board approval, got the stakeholder meeting approvals.
Speaker #3: The chairman appointed by NCLT, they have come in, they have held the meetings. The chairman's report has also been presented. Now, we are filing the NCLT petition, which is the second motion.
Speaker #3: We are filing it anytime right now. Okay. Over the next two, three days. And then the statutory NOCs. Now, these are just standard NOCs which will come in from the ROCs, the GSTs, all of these different statutory bodies.
Speaker #3: The NOCs will be received. And so standard procedure. And then is the final NCLT order. So there's going to be one meeting after this.
Speaker #3: We have NCLT. So this is on the verge. So I will not give you a date, but you can understand based on what I've explained, that it's on the verge of getting close.
Speaker #3: So amalgamation is round the block that good news for all the shareholders, because it simplifies the way we look at the the numbers. And it simplifies not just for us.
Speaker #3: Shareholders who are here, who have already got into VFIN, you are shareholders who have understood this piece and have got in. Once this gets completed, you will have a clutch of other shareholders who will then come in, people who have been waiting on the sidelines for this amalgamation to get completed.
Speaker #3: So the direction is once simplified listed perimeter and each step now is just procedural. In that sense. Moving on to PSB exchange. The headline is the platform is moving from builder to operating throughput.
Speaker #3: That's that's exactly where we are. So on the lender side, we were tracking 32 integrations last year. We still continue tracking that. First quarter is usually a slow quarter in the banking world.
Speaker #3: And more so in the public sector world, because close to by mid-May, end-May, the transfers which keep happening within the bank, those have to happen.
Speaker #3: So so people so a lot of work does not happen in public sector banks the first quarter because of the various transfers. People are coming in.
Speaker #3: They have to understand what is happening. So that is the reason why we have not had more go-lives out there. But we have added if you remember, last time we had five integrations which were work in progress.
Speaker #3: We have added two more to it. So there are two more integrations which are work in progress. So combined, you have 10. So what this means is that when a deal comes in now, that deal is presented to 10 lenders right now.
Speaker #3: And not just three, just because three are live. So deals are now getting presented to more number of lenders. On the sourcing partner side, the traction is still the same.
Speaker #3: We are waiting for more lenders to then keep adding more sourcing partners. On the platform throughput side, there you will see that our limits have increased from five 5,400 last time to 5,800.
Speaker #3: And accumulative requirements have gone up a lot. They've gone to 26,000 crores, because we have a lot of demand out here. Many of these demand these are name cleared.
Speaker #3: So out of the 5,800 crores, there are a lot of names which have been cleared by the bank. They may not have given formal approval, but they have already approved saying, "Yes, this customer, this anchor, this corporate I like." 94 deals 94 corporate deals are in the pipeline at some stage.
Speaker #3: At some stage, they are there. That's what we are working on. Okay. Moving to the qualified pipeline. This is extremely important. So if you see the qualified pipeline movement, this is a bridge which is important.
Speaker #3: This is the first time we are sharing this bridge. Now, we opened with a 79.62 million 20.4 million to the pipeline this quarter. That's what we added.
Speaker #3: We converted 15.27 out of 79.62. Okay. The 15.27 conversion is out of 79.62. So we added more than what we converted. We are close to 4 and a half million dollars of pipeline, which has gone into deferred because of a timeline issue.
Speaker #3: So we know it's going to take much longer. So we have removed that out of the pipeline that we are tracking. So we go back to now tracking a pipeline which is close to 80 million dollars again.
Speaker #3: So despite closing a pipeline, we have been able to add so our pipeline addition is extremely strong. And therefore, we are back to a number of 80 million again.
Speaker #3: So that's a sign of a very healthy funnel that it refills faster than what we are able to harvest. On the qualified pipeline, we had shared this earlier.
Speaker #3: Some of these slides that you will see, we have updated the the numbers. We will try to keep to the same slides at least for the next three, four quarters.
Speaker #3: We'll ll only add slides, but whatever slides we show you, we'll continue keeping the same slides and just change the numbers. So that it becomes easier for the analysts to follow the numbers quarter on quarter.
Speaker #3: Similarly, if you look at the qualified pipeline from a product and geography standpoint, today 70% of the pipeline is non-supply chain financing. And 70% of the pipeline is outside India.
Speaker #3: So both 70 70 is a good number in that sense. 70 is non-supply chain financing. And 70% is outside India. If you remember, going back to our standalone numbers and revenues, our revenues currently are 50/50.
Speaker #3: 50% India, 50% outside India. But from a pipeline perspective, we are more outside India than within India. And I think this international pipeline as a number, I can hazard a guess, we will continue growing that.
Speaker #3: As a percentage, growing. What you'll also see here is close to 50% of our deals, which is 26 out of 52, the number of deals that we're tracking in the pipeline, are more than a single product.
Speaker #3: So our thesis on multiple products selling to the same institution, selling non-supply chain financing, and selling outside India. These are all bearing fruit and a pipeline shows that very well.
Speaker #3: Okay. So this is the validation which I would like to leave you with. This is the the the last slide which I have. What are the priorities?
Speaker #3: So if you ask me, what are the priorities that we as a team are tracking ourselves on? The first and foremost is that we have a very strong pipeline.
Speaker #3: Our sales team is focused on converting that qualified pipeline into opportunities and contracts and implementation milestone. Now, that's what we are focused on. Okay.
Speaker #3: We focused on expanding more of this multi-product wins. Cross-selling to our existing customers already. Now, if you have 50 customers, we still have to do a far better job of cross-selling what we have to our existing customers.
Speaker #3: So that's that's low hanging fruit, which we have not still added to the pipeline. But that's something which the team will start focusing on more.
Speaker #3: The third is PHP extender. PHP exchange, we know it's a marketplace. It's the build-out is slower than what we are anticipated. But we are absolutely on the right track.
Speaker #3: The we are the the corporates that we are seeing, the large corporates, all marquee names, the top 100 corporates of India, the fact that they are coming onto the platform, they are patient with it, bags are patient with it, tells us that the problem that we have picked up to solve is the right problem to solve.
Speaker #3: And people are aware of it. Our bankers are aware of it. Our sourcing partners are corporates are aware of it. And they are comfortable with the pace at which we are going.
Speaker #3: They would like the banks to pick up pace a little faster. But that's easier said than done. Because the banks will move at their own pace.
Speaker #3: We as the exchange are the bridge. Our job is to keep this bridge ready so that whenever the banks feel comfortable in doing business, the bridge is there, the corporates are there for them to pick up the business and do it.
Speaker #3: The numbers that we have in terms of the pipeline of 5 and a half thousand, 5 and a half 5,800 crore, getting that translated into getting those numbers distributed into the channel partners and vendors, that's what the focus will be.
Speaker #3: And the amalgamation and the simplification, which is there, those that's over the next quarter, quarter and a half, is what we are going to be focusing on.
Speaker #3: So we will exit FY27 surely without all of these overhangs on us. So let me close with where I had started. This quarter, the standalone revenue and profits have more than doubled.
Speaker #3: Okay. Year on year. And with the margins expanded. We have signed five new clients, including a sixth product platform win, which is one of the largest digital banks in the GCC.
Speaker #3: Our collections have improved very highly from 149 days in in the past to 80 days. Right now, the pipeline closed is higher than it opened, even after converting 15 million dollars.
Speaker #3: That's important. And the structural work on the amalgamation and the PHP exchange, that is moving forward on schedule. So that's what I leave you with, that whenever you think banking transformation, think VFIN.
Speaker #3: Okay. So the annexure that we have here, it carries our statutory financial statements, our capitalization and modification policies are there. For you to reference.
Speaker #3: With that, I am I think let's open the floor for Vangi, and I am ready to take questions.
Speaker #1: Thank you very much. We now begin the question and answer session. To answer question, please click on the QNET tab on the panel. And click on the raise hand button.
Speaker #1: The operator will announce your name. When your turn comes. Please exit the prompt on your screen. And unmute your microphone while proceeding with your questions.
Speaker #1: Participants, you may click on the raise hand button. To ask a question, first question is from the line of Vikas Goyal. Please go ahead.
Speaker #2: Am I audible?
Speaker #3: Yes, Vikas.
Speaker #1: Yes, sir. Go ahead.
Speaker #2: Yeah, Mr. Raja, just one or two questions from my side. I see that you raised the debts at almost 15 to 16 percent. Rate of interest.
Speaker #2: Whereas, you know, the equity yields are around 3 percent or something. So, you know, you could have increased equity itself rather than taking the debts at such a high cost.
Speaker #3: Sure. Let me answer. I'll take I'll take a question at a time, Vikas. Okay. So that I I don't forget the question. And this is a very important question.
Speaker #2: So what is that?
Speaker #3: Thanks for asking this, because I think this is a question when a lot of investors mind. So you're absolutely right that debt is not debt is not the cheaper instrument.
Speaker #3: On a simple mathematical comparison, absolutely correct. But there are three reasons why we did this. The first is an equity raise has its own process.
Speaker #3: It's got a market timing. And there's a permanent dilution which happens with equity raise. With debt, I have debt when it is available, I can retire the debt.
Speaker #3: That is the reason why we picked it up. What it means is we have visibility today in terms of what our cash flows will look like based on our pipelines, based on the signs that signings that we have, based on the revenue that we are already getting.
Speaker #3: So very we are very comfortable that our cash flows will be able to take care of it. But we did not want to carry the debt indefinitely.
Speaker #3: If I would have issued shares, you're right that it would have been cheaper to get equity. But if I were to do that, then the upside which was going to come two years hence, I would then have to share it with those investors also.
Speaker #3: But the current investors who are there, they are according to us, they are better off with this debt because we can retire this debt over the next couple of years.
Speaker #3: And that is the plan. Our plan is to retire this debt over a period of time. And other thing what we use would have seen is that to get this debt, we have the promoters have placed their shares.
Speaker #3: So the existing shareholders have not needed to do do any go through any dilution. We have taken the risk of pledging our shares because we believe in what we are doing.
Speaker #3: And based on that, we have allowed we have taken the decision of going in for a debt. Though short term it looks more expensive, but in the medium term, it is better for all of us.
Speaker #3: Where the price in the market right now is not right. And I would not want to raise equity at this kind of pricing right now.
Speaker #2: Okay. I mean, I as a remember your last investor presentation, you said they most of the CapEx cycle is over. And we are into a lazy period now.
Speaker #2: That's what the word I think you used. So what is what is the need for raising this 50 crores debt? Because I I don't see that much of the CapEx happening in future.
Speaker #3: I'll explain that. Our our business is chunky. So though our DSOs have come down, we continue doing two things. There's a continued investment which is happening on the product side.
Speaker #3: Yes. But the our revenues are chunky. So this is meant for tidying over the cash flow gaps that are working capital gaps that we have.
Speaker #3: So this is money is for that. The money is not meant for putting into a business or CapEx cycle from which we can't get out of.
Speaker #3: So you're absolutely right. Our CapEx cycle this year is much lower than last year. However, we still require these working capital funds because my what I will end the year at versus what my year my quarter one is, is is not same.
Speaker #3: But when I'm doing my investments, when I'm doing my spends, they are nearly constant throughout the year. So my spends are constant, but my revenues are not constant.
Speaker #3: So I require CapEx this debt capital to come in to bridge that gap for the year.
Speaker #2: Okay. And then another question. Where does the refund win against the incumbents? And where do you lose?
Speaker #3: I refund wins against incumbents when it comes to tech. So our our clients our prospective clients, they love our tech architecture. They love the fact that they are able to get all of these things on one single architecture.
Speaker #3: They love the fact that tomorrow when they want to do a a change, or add replace any of their existing products, they can do so far easier with refund.
Speaker #3: So that's where we win. But where we would I would not say lose, but where we would fall short is when we are up against incumbents who have a 30, 40 year history, with clients.
Speaker #3: Having done this multiple times, we will fall short there. So that's where the bank on our supply chain lineage, that's where the bank on the fact that we have enterprise clients over the last so many years, who we have serviced, again, to supply chain is a transaction banking product.
Speaker #3: The fact that we are able to take care of complex transaction banking product for our large banking clients, should give them comfort. And I say should give them comfort.
Speaker #3: So that is where we are slightly weaker than our competition. Pedigree. Pedigree of 40 years. We don't have that.
Speaker #2: Okay. And the last question, just just you said the PSB exchange we have a, you know, 26,000 crore things. And where is the approval is only for 5,800 crore.
Speaker #2: Only 22 percent. How how how do you explain that, you know? Why does this happen?
Speaker #3: That banking so that is as I said, we are a bridge. We are a bridge. Our job is to see that credit request and credit providers should be able to talk through a common language, a common platform.
Speaker #3: This was never there. We have been able to bring that into play. But we can't influence a bank in the speed at which they will operate.
Speaker #3: The banks continue operating at the speed that they were operating even without this platform. And that is the reason why India has such large credit gap.
Speaker #3: So we as a platform will never be able to take care of the credit gap. But what we are taking care of is the ability of all of this request to be able to be surfaced out to the providers that itself was not there in the past.
Speaker #3: That is what we are doing. So what will happen and the way you should look at this is today we have, as I said, three banks already live, seven under integration.
Speaker #3: And I had said last time also, the day we have 10, 12 banks integrated on the platform, that is the inflection point. So the point in time when we have this infl on the platform is when there will be a race between the banks on who can do things faster.
Speaker #3: Today there is no race. Today there is no race for between the banks because there are three banks which are integrated. Once you have 10 banks integrated, the race will start.
Speaker #3: We ourselves are learning in terms of how we need to engage with the banks. And this is one thing that we have learned that banks need to have a sense of competition amongst them.
Speaker #3: Even for good quality deals. And we are talking of AAA corporates here. For which also the banks take time. And this is the reality of the banking industry.
Speaker #2: Okay. Thank you very much.
Speaker #3: Thank you.
Speaker #1: Thank you. Next question is from the line of Aryan Gupta. Individual investor. Please go ahead. Aryan Gupta. Kindly unmute your microphone and proceed with your question.
Speaker #1: Due to no response, we move on to the next participant. Next question. Is from Kendall Moody from Nuama Wealth. Please go ahead.
Speaker #4: Oh, yeah. Hi. Am I audible?
Speaker #1: Yes. Go ahead.
Speaker #4: Yeah. Congratulations on a good set of numbers. Just a couple of questions from my side. The services business sit around at 20 percent of EBITDA margins.
Speaker #4: How do we see them evolving over the next three to five years based on the acquisitions that we have done?
Speaker #3: So they will remain similar. So we don't see a material difference in the EBITDA margins out there. So we should from a modeling perspective track that itself.
Speaker #4: Okay. And yeah. Just a question around the debt. Which subsidiaries can carry the 60 crore debt? And whether the standalone business has provided any guarantees for it?
Speaker #3: So 60 crores are between our other subsidiaries which are your Infini, Nitio, those subsidiaries. And details of that are there in the consolidated statement.
Speaker #3: So we actually put that down out there. And yes, to your your next what was the second question? In terms of guarantees, you're asking.
Speaker #3: Correct?
Speaker #4: Yeah.
Speaker #3: Yes. We have guaranteed. So there is so refund has provided guarantees. For this debt.
Speaker #4: Yeah. Thank you. That's just from my side.
Speaker #1: Thank you. Participants, you may click on the raise hand icon to ask a question. Next question is from the line of Aryan Gupta. Individual investor.
Speaker #1: Please go ahead.
Speaker #3: Hello. Am I audible?
Speaker #1: Yes. Go ahead.
Speaker #3: Yeah. Thank you for the opportunity. I had two questions. One of them is what triggers the invocation beside the payment defaults? See, I I think what you're asking about is regarding our pledge.
Speaker #3: Okay. Now you have to understand that the pledge that has happened in this share and this is thanks for this question. The pledge that has happened this there is no price link.
Speaker #3: So many of people because I've received questions since morning. There is no price link to the invocation trigger. The shares that we have pledged they are not linked to any price movement.
Speaker #3: So therefore it is static in nature from that point of view. There are only two financial tests which are there. There are two covenants.
Speaker #3: One is on EBITDA which has a ceiling of three per three times. And on DSCR with a floor of 1.25. And we are comfortable on both of them.
Speaker #3: By a big margin. So there is no trigger as such. Okay. The second question is in the amalgation amalgamation stage we are at the fifth stage.
Speaker #3: Of the seventh. So what happens to the pledge trajectory if the NCLT slips? NCLT I we don't see. Okay. So first point we don't see any reason for NCLT slipping right now because we are at the final stage.
Speaker #3: As I said the chairman's report has also been submitted. Everything is clear. We just require some statutory NOCs which are again like it's a matter of fact as a matter of process which will happen.
Speaker #3: We don't see any issue in terms of that. But if it happens and it gets delayed by a few months so it gets delayed.
Speaker #3: If that is not in our control okay. Okay. Okay. Thank you.
Speaker #1: Thank you very much. Next question is from the line of Rahul Malpani. Individual investor. Please go ahead.
Speaker #5: Hey. Hi. Am I audible?
Speaker #1: Yes sir. Go ahead.
Speaker #5: Yes. Okay. So I have a couple of questions. So first is pipeline moved from 79.62 to 80.13. Essentially the same is flat. Is the demand stalling?
Speaker #3: No. No. The fact that see the pipeline that you have been seeing that pipeline has been built over a long period of time. It is that pipeline was not built in one quarter one year.
Speaker #3: It's not that we started last year with a zero pipeline. We always had a pipeline. I think the good thing is that we removed from the pipeline or not removed.
Speaker #3: We converted 15 million out of the pipeline. But we were able to replenish it by 20 million. That's a way so the fact that we have been able to replenish it by 20 million is a very very good number.
Speaker #3: Means ideally that number should have come down slightly because we we converted a very large chunk of the pipeline in one quarter. So I think we we are very good.
Speaker #3: It's a a growing pipeline. A pipeline built over such a long period of time. We have been able to replenish 25 percent of that in one quarter itself.
Speaker #3: That's a brilliant number.
Speaker #5: Okay. Got it. Got it. So the another question is three of 32 lenders integrations are live. And you mentioned that 22 have not started.
Speaker #5: What is holding the rest of?
Speaker #3: I think it's a fair observation. It's a fair observation that others have not started. But this is not quarter in quarter progress which we see.
Speaker #3: Okay. The 22 which have yet to start because there's a bandwidth issue that we have in terms of how many lenders we can take at one point in time.
Speaker #3: Are the lenders side they have multiple projects which are going on. We need to get a priority within that as to when they will pick up.
Speaker #3: So many lenders even after they have signed the agreement they're saying that okay we'll wait for six months because we don't have any bandwidth in our what do you say in there IT pipeline because they have an IT team inside there.
Speaker #3: There also. So they don't have the bandwidth to pick up the integration that's the reason why we are waiting. This is on the private sector and the NBFCs.
Speaker #3: On the PSU banks PSU banks they usually a little slower. For varied reasons because they are much larger in size. They have they have different challenges.
Speaker #3: Their their systems may be legacy for more often than not. So because of that these things take a little time. So I think we as all of us have to understand that PSUs will take time and that is the reason why when we say that there are seven integrations under progress right now 50 percent of those are non-PSUs.
Speaker #3: Because we are also now working to try to get non-PSU lenders ahead of the curve of the PSU lenders.
Speaker #5: Okay. That's from my side.
Speaker #1: Thank you. Ladies and gentlemen we take the last question from the line of Anil Nata from Parami Financials. Please go ahead.
Speaker #3: Yeah. Hi Raja. Can you hear me please?
Speaker #1: Yes sir. Go ahead.
Speaker #3: Yeah. So Raja first of all I believe the pipeline work that you have done on the deal pipeline is fabulous. Being able to convert nearly 20 percent of your pipeline in a single quarter I mean it's very very good metrics on a sales perspective.
Speaker #3: One question around that when you report a 15 million kind of a conversion or a 80 million kind of pipeline are you reporting a yearly deal size or a five year kind of a deal size that you are talking about here?
Speaker #3: Five year. All all are five years. So our pipeline is also five year. Deal size is also five years. Because if you remember that slide which I showed that there's an implementation fees are there.
Speaker #3: Then post go-live your license fees and your AMC keep trickling in. So all of these fees for a period of the contract which is usually five years is what you talk in terms of a pipeline.
Speaker #3: Great. So that is fine. The second point I had was that in the last quarter that was the Q4 you had shown the management view where you had put the numbers of the VPN plus the e-storify and the trade FF.
Speaker #3: And given what will be the post amalgamation kind of view I think at the this quarter the slide got missed out. And we did not have the management view from you.
Speaker #3: So if you have the numbers handy I would request if you can share that. If not I mean if you can issue an addendum with the management view that will be nice.
Speaker #3: So on that what we are seeing is on the the bridge we did not book any revenues on the tradex. The trades platform the the trade and the cash because though we have signed deals though we are implementing them the payment milestones are in this quarter.
Speaker #3: So when we show the half yearly numbers that's where you'll be able to see a far better revenue bridge out there. Okay. So then you and by the time maybe if the amalgamation is done it will show up automatically in the standard on itself.
Speaker #3: Yeah. It will automatically. It will automatically show up. Okay. So fair enough. The third question that I have is basically while I understand your reasons for raising debt in terms of flexibility and other things but the debts came at a very very high rate around 14 15 percent whatever.
Speaker #3: I mean you guys are technology suppliers in trade finance and everything. I mean there could have been better options. Then NCD is at 15 percent.
Speaker #3: There are short term. So one is two years. One is three years. And we will as I said our commitment is to retire bulk of that before time.
Speaker #3: We needed we needed to do the debt right now because the market we did not want to raise equity at the kind of pricing which was available right now.
Speaker #3: We but we needed the debt. We needed capital. If we need capital debt was the only option. And debt is it's not debt versus equity because this kind of question we got the last two times also that why are you raising capital through equity?
Speaker #3: Why are you not raising debt? So that's what started us thinking and the it was you investors who asked us to do that. I had said based on where we stand in our growth trajectory we are not sure whether we'll be able to get debt.
Speaker #3: But then we went out in the market search for debt and we got this debt. This if I am able to pay this off in two years time you investors in two years time will say that great job done because you did not dilute us.
Speaker #3: But you used the debt from outside paid of his tax efficient also. You paid off the debt. And we still have the equity left with us.
Speaker #3: When the numbers actually start showing better two years down the line.
Speaker #1: Thank you. Anil Nata will request you to please email your follow up questions to the company. We'll take one last question. From the line of Uday Chandak.
Speaker #1: And the visual investor. Please go ahead.
Speaker #3: Hello. Sir. My audio.
Speaker #1: Yes sir. Go ahead. Yes sir.
Speaker #3: Sir.
Speaker #1: Uday sorry to interrupt you but your voice is leaking. Can you come in a better reception area please?
Speaker #3: Audible? Not really.
Speaker #1: Uday can you hear us? Uday can you hear us?
Speaker #3: Yes. Hello.
Speaker #1: Uday your voice is breaking. Uday can you hear us? Did you no response? Ladies and gentlemen. I now hand the conference over to Ms. Parvangi Jain for closing comments.
Speaker #4: Thank you everyone for joining us for today's call. Thank you management for participating in today's earnings call. Thank you.
Speaker #3: Thanks everyone.
Speaker #1: Thank you very much. On behalf of Vellorum Advisors that concludes today's session. Thank you for your participation. You may click on the exit meeting and disconnect.
