Aptech Limited Q1 FY23 Earnings Conference Call Insights

Key highlights from Aptech Limited (APTECHT) Q1 FY23 Earnings Concall

Q&A Highlights:

• [00:35:44] Sunny asked about impact of seasonality in terms of admissions. Anil Pant MD replied that typically about 60% of APTECHT numbers happen in 1H and 40% bookings in H2. Avg. booking per student in the media and entertainment is in the region of INR1 lakh, in beauty it’s about INR60,000 and in IT and hospitality, INR35,000.

• [00:37:43] Sunny also asked about typical student profile in terms of 12^th pass-outs, graduates and employed professionals. Saurabh Gada IR replied that majority of students that choose a career course are those passed out of 12th Standard.

• [00:39:15] Sunny enquired about the impact on booking numbers with respect to student profile. Anil Pant MD answered that there have been an impact on bookings because when the student passes out from 12^th they wait for the University admission to happen along with the degree. This has shifted to July, Aug., Sept. from May, June and July.

• [00:40:52] Sunny also asked if there is seasonality in the international business. Anil Pant MD & CEO said the seasonality does exist. APTECHT’s biggest market Vietnam, the season is Aug. Sept. In Nigeria it’s roughly 2Q and sometimes spills into 3Q also. So it differs by geography.

• [00:43:15] Apurva asked about revenue guidance for Aptech IT careers. Anil Pant MD & CEO answered that it’s too early to tell. It was launched on Aug. 1 and it needs to be seen for a couple of quarters. And APTECHT added it has big expectations from it.

• [00:44:55] Apurva enquired how the company plans to spend surplus cash since it’s at all time high. Anil Pant MD & CEO said that APTECHT has a clear dividend policy. So a part of profit is used for paying dividends. On M&A, APTECHT will look for value and look at acquisitions.

• [00:46:23] Apurva also asked about any upward take on ProAlley. Anil Pant MD & CEO answered that APTECHT plans to grow the business with high quality content and has reached 19 courses. APTECH added that it’s already getting about 1,000 odd subscribers every month.

• [00:49:52] Sunny enquired about the institutional business and the pipeline going forward. Anil Pant MD & CEO answered that the company has a good order book of close to about INR100 crores that has to be delivered in 2Q, 3Q, 4Q. APTECHT said that last year it did about INR60 crores of business from one customer and it’s likely to repeat the same in FY23 again from the National Testing Agency.

• [00:51:04] Sunny asked about the mix of business between govt. and non-govt. and how is the corporate training piece of this segment coming. Anil Pant MD & CEO said the corporate training piece is work in progress because the margins were very less. On the mix, most of the business is from government and APTECHT is focused more on central govt. contracts since payment cycles are short.

• [00:52:45] Sunny enquired about the receivables of INR73 crores as of Mar. 22, how much was global retail and institutional and how has been the recoveries. Anil Pant MD & CEO clarified that it’s predominantly institutional of about INR50 crore. On recoveries, the company added that it has been pretty decent.