MPS Limited (NSE: MPSLTD) Q4 2025 Earnings Call dated May. 16, 2025
Corporate Participants:
Rahul Arora — Chairman, Chief Executive Officer and Managing Director
Prarthana Agarwal — Chief Financial Officer
David Goodman — Chief Growth Officer
Archana Jayaraj — Chief Operating Officer, MPS Interactive and MPS Europa
Narendra Kumar — Chief Technology Officer
Analysts:
Unidentified Participant
Vikas Mistry — Analyst
Darshit Surti — Analyst
Krushi Parekh — Analyst
Navid Virani — Analyst
Rahul Jain — Analyst
Gunit Singh Narang — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q4 FY ’25 Earnings Call of MPS Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on a touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Rahul Arora, Chairman and CEO. Thank you, and over to you, sir.
Rahul Arora — Chairman, Chief Executive Officer and Managing Director
Thank you. Thank you. Good evening to Zurik, and a warm welcome to our Q4 and FY ’25 earnings call. Today on the call I have with me Pratna Agarwal, CFO of MPS Limited; David Goodman, Chief Growth Officer; Arshna Jayaraj, Chief Operating Officer, MPS Interactive and MPS Europa; and Kumar, CTO of MPS. Pratna joins us from our corporate office in Noida; David from Austin, Texas; Archina from Chennai, India and Naren from Bangalore, India. This global representation underscores our commitment to serving our diverse stakeholders across the world.
Pratna will kick things off in our opening segment today by discussing our financial performance. Then David will update us on our content solutions developments. Ashna will discuss the progress in our e-learning business. Next, Naren will then follow-up on our platform business updates. Finally, I will provide an update on the outcome of our Board meeting held earlier today before opening the call to questions. Questions. Let’s get going.
Over to you,.
Prarthana Agarwal — Chief Financial Officer
Thank you. Thanks, Rahul. MPS closed FY ’25 with 32.7% and 24.1% year-on-year growth in FX-adjusted revenue and EBITDA terms, respectively. We achieved a new scale of INR726.89 crores in revenue from operations and INR210.9 crores in EBITDA. The scale-up was largely due to the acquisition of AJE, supported by robust growth in the journals business and a recovery in the learning portfolio. Q4 was a strong close to FY ’25. We recorded revenue of INR182.2 crores on an FX-adjusted basis, representing 21.69% year-on-year growth. EBITDA margins improved to 30.76% in Q4 FY ’25 and overall EBITDA grew by 30.99% in Q4 FY ’25 compared to the same-period last year.
Reflecting on the quarter, I would like to highlight three strategic achievements. Our top 15 customers now contribute to 58% of our revenue, a much lower customer concentration than when we started our journey in 2012. In-line with our strategic interest, the geographical diversity of the business is also improving. For example, North-America is now 45% of our revenue, while rest of the world, majorly APAC is now 50% of our revenue. Revenue quality is improving with platforms responsible for 28.56% of our consolidated revenue.
I would now like to hand over to David to discuss the developments of our Content Solutions business.
David Goodman — Chief Growth Officer
Thank you,. The Content Solutions segment recorded remarkable growth. Revenues soared by 30.5% in Q4 and an impressive 34.4% for the entire fiscal year of 2025. This extraordinary success is driven by the strategic acquisition of AJE, coupled with outstanding performance from our established journal business and a cutting-edge approach developing engaging and interactive learning products for the education market. The expansion of the Journal Editorial office, also known as our JEO and peer-review solutions in FY ’25 is propelling our momentum to unprecedented heights. Our collaborations with leading academic publishers are not just exceeding growth targets, they’re elevating our positioning in the research marketplace. Through pioneering efficiency projects that leverage machine-learning and advanced workflow strategies, we are redefining the future of research solutions.
In the rapidly evolving education business now branded as Learning, the infusion of new high-profile clients and a robust pipeline underscores our relentless pursuit of excellence. This impressive growth is driven by strategic collaborations with top-tier educational platforms, continuing education institutes and globally recognized learning companies. The extraordinary turnaround of AJE showcases our unparalleled ability to transform and lead within the industry. AJE achieved an EBITDA margin of 21.7% in FY ’25, far surpassing expectations. This is not merely a turnaround, it’s a powerful testament to our vision and execution even in the face of initial challenges. Our trajectory is bold and inspiring, positioning us as trailblazers in the markets we’ve dominate.
I would like to now hand it over to Archni to discuss impressive progress made in our e-learning business.
Archana Jayaraj — Chief Operating Officer, MPS Interactive and MPS Europa
Thanks, David. In FY ’25, our e-learning division showcased remarkable resilience and strategic execution, culminating in a strong finish with margins significantly improving to 20.93% in Q4. Our operations divisions have transformed and been restructured. The Board move has enhanced our speed, efficiency and accountability, setting a new standard for operational agility. We have streamlined workflows, embedded checkpoints and conducted targeted audits with a focus on user-center design, delivering exceptional quality for clients in sectors ranging from manufacturing to education.
Our innovative reuse strategies, resource optimization and tech-enabled content co-creation have revolutionalized bulk development, allowing us to deliver high-volume projects at unprecedented speed and quality. Furthermore, our personalized solutions, integrating adaptive learning into pre-sales pitches are addressing a wide spectrum of client needs from basic proficiencies to complex learner diversity and positioning us as pioneers in customized learning experiences.
Our strategic initiatives are paving the way for future growth. The early signs of success are now evident, including collaborations with a major Australian retailer through strategic AI partnership and an invitation to join a prestigious conglomerate supplier panel, which is proof of growing influence. Together, these achievements create a compelling picture of resilience, innovation and strategic foresight. We are not just responding to-market challenges, we are transforming them into opportunities, setting new standards and delivering value at every term. Our Board initiatives and relentless pursuit of excellence inspire confidence that we will continue to lead and thrive in the evolving landscape.
I would like to now hand it over to Naren to discuss the developments in the platform business branded as.
Operator
So may I request you to unmute your line from your side, please.
Narendra Kumar — Chief Technology Officer
Yeah, can you hear me?
Operator
Yes, sir. Please go-ahead.
Narendra Kumar — Chief Technology Officer
Okay. Thank you. The growth of our platform business has been nothing short of extraordinary driven by the transformative acquisition of AJV. This strategic move has propelled revenue growth by an impressive 39.3% in Q4 and a staggering 67.4% for the full-fiscal year 2025 compared to the previous year. Such remarkable figures underscore our relentless pursuit of innovation and market leadership. The elevated interest in our flagship highware platform has generated a surge in requests for information and proposals, particularly fueled by the buzz around DigiCore Pro positioning us as an industry frontrunner and a prime contender for critical digital initiatives.
Our Research Solutions division is now functioning more cohesively than ever, postering a collaborative environment that provides a comprehensive understanding of how our platforms integrate into the broader research and publishing ecosystem. This synergy is especially evident within NPA’s labs where cross-divisional collaboration enhances our strategic insights and client delivery.
Furthermore, our strategic relationships are flourishing. Our trusted partnerships with key accounts remain strong and are expanding, fueling a cycle of success and mutual growth. Has established itself as a go-to organization for industry initiatives, offering unparalleled visibility insider access and unwavering client advocacy. These achievements not only reinforce our position as a top tire player in the digital publishing and research technology landscape, but also excite confidence in our future trajectory as we continue to innovate, expand and lead the market with boldness and purpose.
I would now like to hand it over to Rahul to conclude this opening section.
Rahul Arora — Chairman, Chief Executive Officer and Managing Director
Thanks, Lauren, and thank you for the comprehensive update team. Scaling and digitally executing our well thought through and tested growth strategy continues to deliver strong business results. Our five-pronged approach has powered the recent momentum, which includes a revised GTM strategy, a stronger emphasis on star accounts, including cross-selling and up-selling, the addition of new customers across business segments, the launch of new capabilities such as DigiCo Pro and an unprecedented pace of integration of AJE into MPS.
Now to go overboard outcomes. I’m pleased to share that on the robust earnings growth in FY ’25, the Board of Directors has recommended a final dividend of INR50 per equity share of INR10 each of the company. On capital allocation, our priority is always to redistribute surplus funds to the shareholders of MPS, provided there is no eminent use of those funds over the next six to 12 months. This approach has allowed us to stay focused, disciplined and responsible. Look, our acquisition approach continues and is now focused on acquiring healthy and growing assets, albeit at compelling valuations and significantly enhance shareholder value.
Let us now open the call to questions.
Questions and Answers:
Operator
Thank you. Thank you very much. We will now begin the question-and-answer session. And anyone who wishes to ask a question may press star and one on their the touchstone telephone. If you wish to remove yourself from the question queue, you may press R&2. Participants are requested to use handsets while asking a question. Thank you. Ladies and gentlemen, we will wait for a moment while the question queue assembles our thank you.
Our first question comes from the line of Mahesh, who is an investor. Please go-ahead.
Unidentified Participant
Hi, Rahul. I have two questions. My first question is regarding funding acquisitions. In the past, management had articulated that they would — the acquisitions will be funded by internal resources, debt and equity in that order. How should shareholders read into the recent resolution for fundraising through QIP? That’s my first question. Thank you.
Rahul Arora
Thank you, Mahesh. Thank you for your thoughtful question. Yeah, I would not over-analyze the — so firstly, nothing has changed. As you rightly pointed out, that is the correct sequence and equity is going to be the last resort. So I would not delve too deep and worry about the enabling resolution that we’ve gathered. The — essentially what we’ve done is simply armed ourselves with an enabling resolution and only if an extraordinary opportunity presents itself. What would that extra opportunity look like?
Number-one, if in one-shot, we can scale MPS to Vision 2027 and be a year, year or two ahead of the schedule through an acquisition which is of unprecedented scales, strategic fit and capability expansion, of course, acquired at a compelling price. What this would mean is that type of an acquisition would require a check size anything between INR300 crore to INR700 crores, which means that the internal accruals, existing cash reserves and the debt we’re comfortable with is not enough.
So at this point, we are not seeing this kind of an opportunity play-out for us. But we’ve armed ourselves because the market — the market is seeing a lot of consolidation. If we see something, we don’t — we want to be able to jump at that opportunity and not have to struggle to find financing in that particular course. Why — why if it’s so — if it’s so extraordinary, why arm ourselves with this resolution?
First, in the past, we’ve been periodically and repeatedly been approached by some very high-quality institutional investors who express the desire to enter NPS but can’t seem to find any liquidity. So to solve for that, QIP could be a potential solve. We also know that the promoter group is extremely bullish in NPS and has no desire to dilute its position and anywhere before FY ’28 because there is a very strong vision out there. So the promoter group will not dilute. So a possible win-win option is that if MPS finds a massive opportunity where you have to write a check size, for example of INR500 crores, then we are able to conclude the opportunity and a pool of high-quality institutional investors can also enter a captible.
Finally you know the resolution while it may not be used unless there’s an extraordinary event, it does allow us to sit at a different kind of tables where we can pursue large deals and opportunities because at that table, you need to show your source of financing and source of funds. So essentially we are — we’ve opened up a new world of scaled acquisitions to MPS. We don’t have any bites to take on right now, but at least we now have a seat at the table with this resolution.
Unidentified Participant
Thank you. That’s — this is very helpful. My second question is on margins. What could be the impact on margins in any of the verticals that you operate in the medium to long-term because of AI? And have you experienced any changes in the conversations with your clients so-far?
Rahul Arora
Sure. So I’ll talk a little bit about the conversations we’re having with our customers as well as the impact of AI on margins. And then specifically for e-learning, I’d like to bring Ashna in to talk about because in that space, we’re actually seeing some very significant gains in the — in the coming months and quarters. So I’d like her to specifically speak about e-learning. Overall, we’ve seen AI be an enabler of margin expansion. You know, already in the research business for many years now through machine-learning, we have been seeing significant improvements and we’ve always shared those benefits with our customers. So typically, what happens is you can’t implement AI or ML in isolation, you need to collaborate with your customer to — which means that they have to do certain things on their end for the technology to make sense and we have to then of course unlock that for them and configure the technology for them.
So typically that ends up happening in deep collaboration. It starts with the conversation of pitch and benefits are communicated and usually benefits are shared fairly equally between the customer and us. Like I said, within the scientific world and research world, we’ve done this time-and-time again, which has meant vendor consolidation, increased volumes, higher share of wallet for MPS. So we end-up producing more volumes and margins have also expanded. Most conversations that we have around volume expansion and business expansion today are around AI. So I can’t think of a single customer meeting where we don’t talk about AI anymore. That’s how focused it’s become.
So having said that, the highest impact that we see potentially from an incremental standpoint is probably going to be in the education business and the business. And the reason I see that is the penetration right now has been fairly low. So on the education side, you know, I’ll call on David in a minute to talk about some of the opportunities he is seeing with AI from a revenue standpoint. But from a margin expansion standpoint, I think be useful if you could describe what’s happening in the eagering world and how you’re seeing margin expansion.
Archana Jayaraj
Thanks, Rahul. So in continuation to the point on AI, we are in fact seeing a lot of productivity gains because be it content development or even the delivery process itself. So we have started incorporating AI in terms of intelligent automation or adaptive design and even reuse strategies for that matter. So we’re able to pass-on these benefits and compress timelines for our customers and reduce manual effort, manual work and also maintain consistent quality and all of this put together has resulted in improved margin overall.
Rahul Arora
Thanks, David, could you also talk about some of the — I know we spoke about the margin benefits. Could you also talk about the revenue opportunities for the AI?
David Goodman
Yeah, sure thing,. So I think we’re leaders in AI and we see that unlocking a lot of new revenue streams, positioning us at the forefront of industry transformation. With our advanced AI capabilities, we’re expanding into high-growth areas such as accessibility, real-time translation, intelligent language editing, content generation. Just a couple of examples. We were selected as the primary translation vendor for one of the world’s largest education publishers, thanks to our ability to dramatically improve turnaround times, reduce cost through AI-powered workflows.
We’ve also secured major contracts with several high-profile scholarly and education publishers seeking to rapidly meet the upcoming accessibility requirements. Again, our AI-driven solutions allowed us to deliver faster, more cost-effective services than traditional providers. These wins are validating our technology leadership, but also demonstrating the growing demand for these AI-enabled solutions, positioning us to capture new customers, deepen client relationships and drive sustainable top-line growth.
Unidentified Participant
Thank you. Rahul, if I can ask a follow-up question. And since you mentioned so many changes in e-learning because of AI. Have you made any changes to the acquisition playbook, especially for e-learning.
Rahul Arora
Yes, not just e-learning in general, we have modified our acquisition playbook. We are looking at targets where they are at least at some point in the journey towards adoption of AI and technical innovation, making sure that we do get some strategic AI expertise.
We’re looking at from a diligence standpoint, our diligence is very data-driven now. We’re using advanced AI analytics to perform comprehensive market and financial evaluations to mitigate risk. They also are disciplined. So if we find a deal where an acquisition is not even thinking of AI or we find that they are not evolving and will get disruptive, then we will get disrupted, we just pull out from those type of conversations. So the portfoli — we want to make sure that whatever we’re adding to our portfolio is innovative, it’s future-proof and aligned with our overall growth strategy.
Finally, we are prioritizing acquisitions that are aligned with our vision of AI-enabled transformation. So again, if a target business lacks AI integration or shows signs of being vulnerable, we identify them as non-core. So overall, we are embedding AI at the core of our acquisition process and reinforcing our commitment to being the pioneer and leader in our space, not just in terms of innovation, but in terms of sustainable value-creation for our customers.
Unidentified Participant
Thank you. All the best to the team.
Rahul Arora
Thank you.
Operator
Thank you. Our next question comes from the line of Vikash Mistry from Moon Sort Ventures. Please go-ahead.
Vikas Mistry
Yeah, thanks all. Thanks for the opportunity. I have a couple of questions. First on organic growth. We are doing good at least from acquisition standpoint, but our organic growth is still quite low. So what are the regions? And when we see the reason 2028, the 10% growth should be needed for that. So how we are looking at it that?
Rahul Arora
Yeah, good question. So I think overall, you know, we — like I said, we’ve redefine our go-to-market strategy. We look at our research business as a market, our education business as a market and our corporate business as a market and I’ll call on Ashrana to talk about the corporate business because that’s where the softness really has been in the past couple of quarters. Having said that, research has been growing ever since the acquisition of HiWire. In fact, while our platform business did not take-off after HiWire, as a result, our content business, which is — which on the research side started to significantly grow after the acquisition. The market is obviously viewing us differently.
So on the research side, our content business has taken off. So similarly, you know, on the education side, we had a very strong FY ’25 as David described in his opening remarks, which includes not just growth with existing customers, but the addition of very high-profile net-new customers. So that business also has delivered strong organic growth. We’ve had softness in the corporate side of our business in terms of organic growth, but we’ve seen significant margin expansion. But maybe can weigh-in on what she’s expecting in terms of revenue growth and also how that will play-out over the course of the next few months?
Archana Jayaraj
So we have been seeing this period of a strategic transition that’s deliberately paced to drive long-term value. So our focus was on margin expansion and we have in fact made strong headway because of the operational efficiencies and productivity enhancements that we have incorporated. We also see the strength continuing and improving in Q1. And we have also made, I would say, significant progress in terms of our product roadmap and AI leadership capabilities and we also see this translating into revenue expansion in the subsequent quarters. So there are some encouraging commercial signals that we have witnessed.
For instance, we’ve had like a 16% increase in new logo wins in FY ’25, which speaks to the market confidence in our solutions. We have similarly seen a 41% increase in the average new deal size from the start of the year from H1 to H2. And this again reflects our ability to move-up the value chain and sell more strategic offerings. So all-in all, the top-line will reflect the tail-end of the transition in Q1. The trajectory is very clear. We are building a leaner, smarter future-ready business and we are confident that Q2 will see a 20% revenue expansion.
Rahul Arora
Thanks,. So I think so research has already — research has already been growing at double-digit, education was growing at — it has grew at double-digit for the first time in FY ’25 and then corporate now takes off from Q2 onward as Ajna described. So I think at the core of this also is, you know, the structure of the business, the research business has significantly been strengthened between the acquisitions of and AJE. So the value proposition has been elevated to a new level where while we may not be number-one in terms of size today in the research segment. We’re definitely number-one when it comes to value prop and capabilities.
Similarly in education, again, not number-one in size, but from a capability and value prop getting there. And then on the corporate side, you know, there’s obviously this phase of getting our act together in operational excellence, but there’s also been a lot of investment in products and new capabilities and that unlock — begins in terms of those capabilities translating to revenue that unlock begins from Q2 onward in terms of new products being delivered to the market, customers for those products and so on and so forth. So two out-of-the three are already performing in terms of organic growth and the third one will get unlocked in Q2 FY ’26.
Vikas Mistry
Yeah, thanks for the elaborate answer and kudos to the team for a very good margin expansion, but at least we want to see ordering growth also jumping in the — from Q2 onwards.
Rahul, my second question is on AI. So as we are — I think all the management team has shared that we have very leadership position, AI and all that. So I want to go in-depth of it. So are we using multi AI agent orchestrations or what we are doing? And we have seen that in AI, if you build the capabilities, then revenue growth can be really not exponential, it will be impulse like function because we have seen in other AI companies also. So are we somewhere near to that or it will be too much far further situation that we are hoping from you. And can you elaborate something more on whatever the segment-specific AI capabilities that we have incorporated and how we are ensuring that agility of team will be such high that we’ll adapt everything at very rapid impulse space.
Rahul Arora
Sure. So I’ll let talk about the technical aspects as a CTO, the technical aspects of MPS Labs and AI in a minute. I’ll talk more about the business aspects. So to begin, you know when this whole journey started, MPS Labs in fact was founded as central Technology and the brief was enhance productivity and make sure that we are future-proof as a business. A few years ago, we rebranded as NPS Labs, we — but where the mission kind of pivoted from don’t just be a productivity driver, but also be a revenue driver for the business. And that pivot has been very successful. As David pointed out, it’s opened up a bunch of new revenue opportunities.
We are now launching in FY ’26, a data and AI practice, which is going to be a profit center housed within MPS Labs. So-far NPS Labs has pretty much been kind of a support function. So we’ve allocated budgets and people towards this data and AI practice where instead of just supporting the business more passively, the data and AI practice actually goes to-market as an independent practice selling data and AI solutions. We are expecting that in the first year, the business will kind of breakeven on it on its on its own on a standalone basis. Of course, we continue to provide services to the rest of the business, but we are planning to launch this year.
The other impact that we’ve seen around MPS Labs, data and AI in general is also the capability of the people that are working at MPS is also increasing. So one is we — the level of engineering has grown. But also the level of subject matter expertise has grown because now the people on the content side that are employed by MPS, that profile is also changing from BPO to KPO. So today, for example, we employ over 100 in the US. These are subject matter experts and academic editors who are essentially sitting in the content helping improve the scientific integrity of the content and getting it ready to be published. We also have a ballparking here, but about 150 PhDs in India that are doing the same activity, of course at lower-cost for the customer and a pipeline to grow that you know by 30%, 40% over the course of the year.
So the quality of workforce and the capability of the workforce is also transforming between the engineering piece, but also the scientific expertise within the company. So that’s the other knock-on effect that’s happening. So yeah, so very, very bullish about this. In terms of is there an exponential function or the pulse function those are things that you know time will tell us, but definitely hoping that the new independent data and practice house under NPS labs sets a new revenue stream for the entire company.
And it will be useful to kind of describe in MPS labs in terms of the type of people you employ, what’s the technical level of expertise and how we structured?
Narendra Kumar
Yeah, sure. Thanks,. Yeah, basically, see, MPS Labs, you know, we feel very strong team of domain specialists, engineers and we have a dedicated team of AML also. So in fact, the AML team has been further expanded, you know by adding in further ML engineers and further data centers as we are seeing a huge strategy in all the use cases which have been working on.
So just to let you know, we have been working on various AML use cases across the end-to-end workflows. So these are in various areas related to, for example, content creation, image processing, accessibility, diversity and equity inclusion, content editing, copywriting. So these are some of the various areas where we have been working on and we are seeing any efficiencies of some of these projects which have gone live, we are seeing efficiencies anywhere between 30% to 50% in certain areas of the implementations from a productivity perspective. And these teams, the NPS Labs team, the AML team is supported by a dedicated team of SMEs like Rahul mentioned, which is called the Digital quality specialist team which are working on various models for training the models, validating the datasets and fine-tuning for further performance improvements.
And also we have been developing various tools, automation tools around AML, basically for our monitoring the model iterations, the training and tracking the productivity and performance dashboards. So these are also developed and we are also constantly using this where we showcase not only to our customers in terms of where we stand-in terms of the performance and activity improvements, but also internally we use this widely for tracking the entire progress of the AML use cases?
Vikas Mistry
Yeah, that’s great to hear Naren and Rahul, we hope that you continue to scale that well and we hope that AI revenue streams to scale quite meaningfully. My last request from you, Rahul that’s the last question. Last request from at least my side on capital allocation. So Mr may we request that you return okay. No, no, it’s fine. Let’s finish, please. Let’s the question. Okay. Thank you all for that. So my last request on capital allocation is that you mentioned that if there is a INR700 — INR400 crore INR700 crore acquisition. So we have already have some cash and then INR200 crore will be the free-cash be receiving almost every year, then please try to make sure that equity portions would be as minimal as possible and that would be request from our side.
Rahul Arora
No, absolutely. We couldn’t agree with you more. Please remember, I also represent the promoter group. So our interests are completely aligned, right? So equity is always very, very expensive. Like I was explaining earlier, you know, it’s giving us a seat at a different kind of table. So think of it, we got a resolution that give us an entry ticket. We will only cash that ticket if you know accruals than INR150 crore to INR200 crores of debt. So you’re looking at some up to INR300 crores pretty much on our own. Over that then we start to think about what do we do to close this transaction.
And again, that’s a very extraordinary event, but at least now we have that entry ticket. Please be rest assured, we — over the last decade, I think know what we’ve done really well operationally is run a business that is grounded in the realities of operational excellence. But I think the invisible hand has been our ability to allocate capital. I think capital allocation has been the strongest kind of a differentiator for MPS as we scale the business. So be rest assured, in our in our thinking, we are completely aligned.
Vikas Mistry
Thanks all for that. Thanks. I greet you to reaffirm the conference only.
Operator
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to one or two per participant. Should you have a follow-up question, we would request you to rejoin the queue. Thank you.
Our next question comes from the line of Darshit Surti from Girik Capital. Please go-ahead.
Darshit Surti
Hi. Congratulations for the great set of numbers. I just wanted to know if there are any acquisition — prospect or acquisition targets that you might have in mind or is there any visibility over that side since we’ve already taken the approval? That’s my first question.
Rahul Arora
Okay. So like I said, those large ticket sizes that I described, those are not in play right now. Having said that, the standard deals that we’ve been doing over the last 12 odd years, we’ve done 10 acquisitions of last 12 years are always eminent. So we do — we tend to do one or two acquisitions every year. So you can expect that kind of run-rate in FY ’26 as well, very much part of the of the overall growth plan. So look-forward to making some of those announcements through the course of the year.
Darshit Surti
Okay. So these acquisitions won’t require equity business.
Rahul Arora
Correct.
Darshit Surti
Okay. And so that’s all from my side. Thank you. Thank you.
Rahul Arora
Thank you. Thank you.
Operator
Thank you. Our next question comes from the line of Kushi from Bugal Rock PMS. Please go-ahead.
Krushi Parekh
Yeah, hi. So my first question is that on the sales growth trajectory for the e-learning business, we have seen a degrowth over here, though on a good side, the margins have been improving on this. But can you help us understand that we have been having a good pipeline on the e-learning side last call, I recall that we were piloting with about 50 odd customers over here. So how is this trajectory likely to shape up going-forward? And also the reason for how — why the trajectory has been like this for this quarter.
Rahul Arora
So I’ll let Ashna describe why it’s been slower. But I think like you rightly pointed out the trajectory has been margin expansion, margin expansion, margin expansion and you’ve seen that through the quarters. That trajectory plays out from as we as we move from Q4 FY ’25 to-Q1 FY ’26, it continues to play-out. So we see more margin expansion. And as described, there’s a lift-off takeoff on the revenue side from Q2 onwards, so Q2 FY ’26 was a couple of months away. So that takeoff is eminent. They obviously have formal commitments. They can see it. But maybe Ashna, you can describe why this has been slower than what you expected.
Archana Jayaraj
Thanks, Rahil. So we were looking at — as you rightly pointed out, I mean, we had new logos come in last year. In fact, the number of new logos increased, which I did mention earlier in the call as well. We had in fact, a 16% increase in the total number of new logos in the — in FY ’25. And also we saw the average deal size go up and these to me are strong indicators that we see a strong pipeline going-forward as well. But we have been deliberately focusing on operational efficiency because we do believe that this would be a key contributor, not just in terms of reducing the timelines, but also in enabling higher client satisfaction. And the fact that we have a long list of global enterprise clients who are trusting us, I think stands testament to this. But we are, I would say, at the final consolidation stage and therefore the trend of margin expansion would also continue well into Q1. And from there on, from Q2, we would be seeing the 20% revenue expansion.
Rahul Arora
Yeah. And just add to that, some of the some of the solutions that we are pitching now, they are more complex compared to the kind of work that we used to do. So as a result, there’s a lot more iterated testing, piloting customers that tend to be. So yeah, I think that could potentially explain that the — as as saying the average deal size has gone up, the reason the average deal size has gone up is because the solution is also more complex. So yeah, that could potentially be just to kind of be a more academic answer, potentially be one of the reasons why it’s been slower than we already expected. But having said that, Q2 is like six-weeks away.
Krushi Parekh
So basically, we can delivery of these projects Q2 onwards, largely speaking.
Rahul Arora
Correct, correct.
Krushi Parekh
Okay. And my second question is that we have been mentioning about the market size of about INR600 billion across our capabilities. I want to understand, given our capability currently, how much of this is tappable by us at the moment? And how is the competitive scenario in this arena shaping up and how strong or weak are the competitors over here?
Rahul Arora
Yeah. So the — when we started this journey, our largest competitor was about $115 million in revenue right so and now they’re closer to 400, I think they they’re running for 500 million and you know it’s difficult to answer, you know of INR600 billion, how much can we — how much can we get a hold of, right? It’s a very difficult question to answer. What we can answer is we are chasing — we are chasing the other larger competitor. So our first goal would be to at least get to that INR1,500 crores of revenue by FY ’28.
And then I think we — I think then there’s another reset because guessing the — that competitor would have also grown to a much larger size because they are also growing. So from my perspective, I think it’s difficult — when you have a blue ocean of $600 billion. I think that’s enough for everybody. So you focus on working in your level up, making sure that as we level up and scale-up, we are not doing anything silly. We continue to allocate capital efficiently. We don’t do any lazy acquisitions. We continue to invest in the business, which is also equally important. So really we’re looking at our lane and we feel comfortable saying that INR1,500 crores FY ’28 feels very, very achievable. So we’re in that lead right now.
Krushi Parekh
Okay. Sorry, just a follow-up on this. So when we are talking about this the size of the market, this includes the captive teams of the publishers and others.
Rahul Arora
Yes, right? It includes — include the captive as well. Absolutely.
Krushi Parekh
And how much of this would be something that would be either outsourced or provided by the outside organization?
Rahul Arora
No, so captive is also outsourced, right? So again, there’s not — unfortunately, there’s not much research. You and I are dealing with the same challenge that this is not a space that has a bunch of industry reports and things like that. So we are — we are dealing with equally thin information. I think the key takeaway, again, we are not modeling is probably the way you’re modeling it. The key takeaway for us is that there’s a lot of runway. And as operators of business, that’s all we need. We don’t need a definition of whether what is that CAGR look like, what is the terminal growth that look like? For us as operators, do we have runway and-answer the assets also — and in terms of capabilities, I feel that we — I believe that we have broadly you know much of it already. Having said that, there’s always room for improvement and those fringe requirements will continue to attack.
Krushi Parekh
Thank you. All right. All right. I have some more questions, but I’ll get back-in the queue. Thank you.
Rahul Arora
Thank you. That’s fine. Thank you.
Operator
Thank you. Our next question comes from the line of Navid Virani from Bashtian Research. Please go-ahead.
Navid Virani
Hello. Hello, sir. Yeah. Hi, thank you for the opportunity and congratulations on a good set of numbers as well as a successful turnaround of AG. So I have a couple of bookkeeping questions. First one, if I look at the operating cash-flow for the year, I can see that a lot of cash is being stuck in working capital. This has obviously impacted cash conversion. So can you give us some sense of where exactly is this getting stuck? And is this one-off in nature or this is something which is state?
Rahul Arora
So I’ll let give Tata a second to compute that and walk you through why there’s a mismatch in the operating cash-flow. Having said that, overall, if you look at our DSO, our DSO has been improving for quite some period of time. And I think last quarter, we were at 51% and we had even touched 45 in the middle. I think this quarter our DSO is 53. So from that standpoint, it’s improving. Historically, we were always in the 60s, right? So now that now that we have a B2C business as well, which is largely advances that we feel comfortable that DSO should be somewhere in the 45% 46 47% range. We’ve had a one-off in Q4 in terms of DSO, but maybe I’ll let Ratna create the bridge around you know, why is the working capital where it is at as well as you know, how the DSO has behaved in Q4.
Prarthana Agarwal
Yeah, thanks, Rahul. I think broadly, Rahul, you’ve covered. Just to add, as Rahul mentioned, if you look at the last year, the DSO was around 67 days. So with the change in the revenue mix, we have brought the DSO down to around 53 days as of today, as of the March-end. And this DSO, we had seen the good days of September at 44 — the DSO was 44 and now this has come slightly increased to 53. When you say that the cash is stuck in working capital, if I look at the last year trend, the cash stuck in working capital was anywhere between INR60 crores INR70 crores.
Right now, if you see INR52, I think there are certain efficiencies which can be built-in in terms of a better DSO because of the change in revenue mix, which is roughly a 10 to 12 days. Balance considering a B2B business, I think that’s the kind of working capital requirement that we would have on an ongoing basis. And whatever streamlining can be done in terms of efficiencies, we will do that. But to answer your question, I think the only inefficiency that we have is a 10 to 12 days higher debtor days, which we will work upon and we believe that this can be.
Rahul Arora
And apart from there were some pullbacks for acquisitions and all that, right? Do you want to talk about that as well?
Prarthana Agarwal
So what is happening? Yeah. So that impact has happened on a year-on-year basis. So if we see last year, we were carrying a lot of liabilities which were holdbacks for our last acquisition of AGE, which completed on 28th February ’24. So there was a payment of around close to INR40-odd crores, which was on this account, which has now been completely settled. So that movement has happened from the liability side. So probably now assets increasing to that extent is — that’s why the number is looking huge. Otherwise, other than the DSO improvement, I don’t see any other movement there. That one-off from last year to this year, that one-off movement in the liability is on account of the holdback of the HAE acquisition, which was a cash-neutral transaction as far as NPS is concerned.
Navid Virani
Yeah. Okay. Very clear. Very clear. I want to bookkeeping question that I have is pertaining to other expenses. If I look at the other expenses, both in Q4 as well as FY ’25, I can see a steep rise in this number. So can you just give us a sense as to what are the items which are driving this rise? And can we expect operating level benefits because of this going-forward? I mean, as the business up?
Rahul Arora
Yeah, I think so, you know, there are parts of our business where we are — we are trying to reduce the fixed-cost. Fixed-cost in a — in our business is mostly employee expenses because the nature of the demand in terms of input that we’re getting, you know, getting is a wide variety. So to house all that talent internally is we’ve learned from Liberate and AJE and competitors of AJE that is not the right method to drive margin expansion.
So you know our overall margins as you will see continue to expand and one of the reasons we continue to expand is because we’re embracing outsourcing using contractors and those kind of things as a tool to drive margin expansion. So yes, so there is a structural change happening in the company, which is we’re trying to do — trying to have — to embrace outsourcing and contractors in the business. That’s my overall understanding.
Would there be anything else in other expenses that I’m missing, which other side outsourcing?
Prarthana Agarwal
Yeah. If you’re really comparing — just to add-on, I think that’s largely it. But yes, if you’re comparing the other expenses with last year, I think the major increase is on account of the acquisition of HAE and the Liberate, which is a full-year impact this year. Otherwise, if we see the other expenses excluding that, those are in-line with the increase in revenues.
Navid Virani
Okay. And last one, if I may. In the initial remarks for the e-learning solutions segment, you mentioned some collaboration in Australia as well as I think somewhere else. Can you just give some more details around that? That’s my last question.
Rahul Arora
Thank you. Yeah. So yeah, so it was — I can’t mention the name because we cover it by NDA. But essentially what I can mention is that it is a strategic AI partnership and then the other one is we’ve been invited to join the supplier panel for a large conglomerate. Again, can’t talk about who they are because the customer doesn’t want us to share so yeah, so it’s panel on the conglomerate supplier panel.
Navid Virani
Sure, sir. Thank you for the opportunity and wish you all the best.
Rahul Arora
Thank you.
Operator
Thank you. Our next question comes from the line of Kashish Mehta from Dolat Capital. Please go-ahead Mr Mehta, your line has been unmuted. Please go-ahead with your question. May I request you to unmute your line from your side. As there is no response, we move to the next participant.
Our next question comes from the line of Kiran from TableTree Capital. Please go-ahead.
Unidentified Participant
Thank you. Congratulations on a good set of results. One very basic question for you. I might have got my number up. So AG acquisition we did on 29th 2024, AG had revenues of about $35 million — around $35 million, $33 million $35 million, which is worked at around INR250 crore INR300 crores. Now given AGE is effective for the full-year for FY ’25, the difference in revenue between FY ’25 and FY ’24 on a consol basis that I’m seeing INR725 minus INR546 is INR179 crores. So I’m just not able to kind of place because we had only one month of AGE revenues to be recognized in FY ’24. So we have —
Rahul Arora
Yeah. So just to this one? I can answer that. Yeah. Yeah. So that’s how AG was presented. Remember, AG was a loss-making company and typically as we do in loss-making companies, we exited from a variety of customer contracts. That’s why you also see our other income has significantly increased this year. And the reason is that we’ve — with some of the contracts, we had to walk away some of the contracts, we had to renegotiate and modify terms. So AJE overall is now a $20 million — $20 million business. So it’s not the size that it was sold to us at and that has been a very conscious strategy.
When you presented with a turnaround type of situation, the first thing you do is you figure out what is profitable and what’s not and what unprofitable exit — you get-out of there. And that’s what we’ve done. We’ve kind of gotten out of this whole — the loss-making part of the business. So that’s not what we — and it was never 35 million. It was I think in the mid to late ’20s. But yeah, we’ve exited — we’ve exited some of the unprofitable aspects of the business. It was never in our run-rate.
Unidentified Participant
So got it all. So let’s say 20 million also. Million is about 160 million.
Rahul Arora
I’m ballparking there. I’m ballparking there. It’s not exact number. I’m ballparking there. And again, I’m unable to give the exact number for AGE because of the competitive nature of that market?
Unidentified Participant
Of course, of course. So my general broad question, Rahul, was not to get into exact numbers to be very honest. My broad question was, let’s say AG is somewhere in that range, we have just grown INR179 crore of revenues from FY ’24 to FY ’25, AJ is most of it. So have we actually grown organically?
Rahul Arora
Yes, we have — that was explaining the part of the business that’s not grown in the corporate business, which has been a weight — a weight on the business. But the other part, the research piece and the education business has grown.
Unidentified Participant
Okay. Okay, because the delta is only INR17 million crores. So maybe I’m not able to make sense of numbers. That’s right. So that is one part of the question. The second part of the question is, over FY ’26 and FY ’27, what is the organic growth that you’re targeting? Is it about 15% year-on-year kind of thing or will we see a lower, higher number? Again, I’m not looking for exact numbers, but just your ballpark in terms of organic growth.
Rahul Arora
Yes. So we’re chasing 10%, 12% type of growth organically. And of course, Ashrana pointed out that the corporate business may have some, you know, a higher-level of growth in the short-term. But overall, I think, 10%, 12% organic growth is what we look to do in this business. And over and above that, we get inorganic growth, which gives us that other — the lift-off to the larger size.
Unidentified Participant
Got it. Got it. Got it. All at all. Thank you so much.
Operator
Thank you. Our next question comes from the line of Kashish Mehta from Dolat Capital. Please go-ahead.
Rahul Jain
Yeah, hi. This is Rahul Jain. Hope my line is open up. Yes, sir, please go-ahead. You’re audible. Yeah. Congrats management in a strong year. I just wanted to understand for the next year perspective, is there any demand scenario kind of a challenges in some manner that we are seeing given the research specific or education specific changes cuts that have been announced in the US market? And we also have good China business. So anything related to that given the challenges you are facing on the trade side?
Rahul Arora
Yeah, we are Rahul, thank you for the question. We are on high alert. As of now, I have nothing to report in terms of any negative — negativity on the demand-side. Now if that changes, of course, subsequently, we will be the first one to report it. But as of today, we don’t see anything negative.
Rahul Jain
Right, right. And also any incremental trend towards a cost-saving side of initiatives because what from the management is a combination where either people are going for a pause or they are doing a very, very large projects to building cost-down significantly. So is there any unusual trend that we are seeing in the last few months?
Rahul Arora
Try to repeat that unusual trend internally? I didn’t understand the question, could you say?
Rahul Jain
So what we could see some diverse one is that various pause that some of the vendors are seeing on the outsourcing side, while some of the clients are doing mega transformation, very, very large deals. So we’re hearing very large deals also. So there are — our understanding is that some people are completely falling to stay budges while some others are accelerating it because they want to bring the real cost-savings. So is there any usual trend you’re seeing from the size of deals with a pause or acceleration in terms of sizing?
Rahul Arora
Yeah, size of deals, as you have pointed out, size of deals are growing. Also, transformation programs are being launched and we tend to be in the top one or two companies that participate in these type of programs. But the size of deals is also growing in terms of transitions are becoming more rapid and transformation programs are being discussed?
Rahul Jain
Got it. Got it. Thanks, that’s it from me.
Operator
Thank you. Our next question is from the line of Guneet Singh from CounterCyclical PMS. Please go-ahead.
Gunit Singh Narang
Hi, congratulations on the turnaround of AG. I just have a couple — most of my questions have been answered. I have a couple of questions. So do you have any guidance — conservative guidance for revenue and PAT for FY ’26? And my second question would be, we had a sign — we had an exhibition which got deferred a couple of quarters back, which had significant revenues. So can you please give any updates on that?
Thirdly, I would just like to understand the perspective of the promoters. So promoters are getting a lion’s share of the dividend, which is about INR140 cr. So I would like to understand, do they — would they be investing their money in NPS itself or do they find any better opportunities to place their — the payout that they’re getting from these dividends? So that’s all from my side.
Rahul Arora
Sure. So I think on the first question, yeah, we don’t share forward-looking guidance. We’ve articulated a vision for FY ’28 and we are on-track to meet that — meet that vision. On the question around the experience Center business, we’ve completed the Phase-1 of that business, which is kind of designing the consulting phase and designing the — designing the experience center. We’re looking-forward to learning more on the execution of that experience center. It’s now it’s now not just one experience center, it’s multiple experience centers.
So we’re looking-forward to learning from that from the customer in the coming weeks — in the coming weeks and months. In terms of the promoter group, yes, I’m unable to answer that question because it is a diverse setup. It’s not some — it’s not an office I hold. I hold the office of NPS and I’m unable to answer the question around how the diverse automotive group plans to allocate that capital. That’s not a question I can answer.
Gunit Singh Narang
All right. So can you share some more details about the experience center? How much have we invested in that? And I mean, what kind of capabilities does it have? How many exhibitions can we expect from it in —
Rahul Arora
That’s a competitive — that question is as competitive you’re asking competitive information as part of the bid process. It’s hard for me to disclose individual proposal in big detail.
Gunit Singh Narang
All right. Thank you very much.
Operator
Thank you. I would now like to hand the conference over to Mr. Rahul Arora for closing comments.
Rahul Arora
Yeah, thank you. Thank you again. At NPS, as I was saying earlier, we’ve demonstrated a strong track-record of high capital efficiency and disciplined capital allocation over the last decade. Our growth has mostly been funded through internal accruals and historically, the only time we raised primarily — primary capital was back-in 2015 when we raised INR150 crores through QIP.
So I would urge everyone to look at our track-record. So the QIP resolution as I described is only for an extraordinary event. But if we do end-up proceeding in the next six to 12 months, we are very confident that we will allocate that capital efficiently and we will not return to the market for many years. So that was kind of my final comment on the QIP. Thank you for your active participation. We appreciate all your thoughtful questions. Your perspective helps us learn and improve and we want to thank you for your continued support and respect.
As I’ve shared previously, our journey together has indeed been remarkable and there’s a long road ahead to FY 2028 and we have a tremendous opportunity to supercharge scale as we head there. I look-forward to your continued support, feedback and partnership mindset as we march 1st 2028. Thank you so much.
Operator
Thank you. On behalf of MPS Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.