Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Aurionpro Solutions Ltd (NSE: AURIONPRO) Q4 2026 Earnings Call dated May. 12, 2026
Corporate Participants:
Ashish Rai — Vice Chairman & Group Chief Executive Officer
Analysts:
Unidentified Participant
Presentation:
Operator
And welcome to Innovations Limited Q4 and FY26 results Conference Call today. On this call we have with us from the management Mr. Ashish Rai, Group CEO and Vice Chairman, Mr. Vipul Parmar, Chief Financial Officer and Mr. Inath Kelkar, Company Secretary. Let me draw your attention to the fact that today’s discussion may include certain forward looking statements which are predictions, projections or other estimates about future events. These statements reflect management’s current expectations about the future performance of the company and are subject to certain risks and uncertainties that may cause actual results to differ materially.
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. I now hand the conference over to Mr. Ashish Rai, Group CEO and Vice Chairman at OrientPro Solutions Ltd. Following his comments, we will open the forum for question and answer session. Thank you and over to you Sir.
Ashish Rai — Vice Chairman & Group Chief Executive Officer
Hi, good afternoon everyone and thank you for joining the call. FY26 that we just finished was a year of strong execution from the team against a genuinely complex backdrop. By our own standards the final result was below par. We can do better and we will. When we entered the year we planned for the revenue to grow close to 30%. Even right up till we we entered the second half the plan was intact. In reality the revenue actually grew 20.2% to INR14.11 crores. EBITDA margin was 20.02% and PAT margin was 15.02%, well within the guided ranges of 20, 21 and 15 to 16.
But towards the lower end of our plan ranges, Q4 was shaped by a cluster of factors, some we had clearly not planned for. So let me address those up front. The biggest impact on Q4 and likely Q1 of this year as well was the war in MEA. The Middle east has become an increasingly important growth engine over the last couple of years as you would have noted, particularly for banking, and we fell really short there on both committed Q4 deal closures as well as planned project completions. We believe this is temporary.
The spend appetite in the region is intact once the geopolitical picture clears. Data center business performance was also affected in Q4. A very large hyperscaler win that we announced required us to start execution, start investing, but the revenue slipped from Q4 into Q1 because of planning delays on the project which we had not clearly anticipated. We also absorbed a one time impact from labor code implementation and as I shared last quarter, we have significantly stepped up both expensed and capitalized investments to meet what we feel are generational opportunities opening up in AI and in data centers because the window for us to act is very narrow.
While we are convinced these investments are needed to capture these opportunities for our shareholders, the timing of these investments would have been a lot better if we had delivered to the revenue plan in second half of the year, which we clearly didn’t. I want to be candid on one more point. We have grown rapidly for the last five years. As you would have noted, the business has probably quadrupled over this period. That is generally a good problem to have, but five years of this space has left us stretched in places and the current revenue miss from geopolitics and the speed of AI led disruption have exposed those vulnerabilities.
We will address these gaps with focus and will leave no stone unturned in making Orion Probe better protected against extraneous shocks. Despite the near term roadblocks, we are confident that the medium to long term growth drivers across each of our businesses are intact and we will execute with discipline to deliver a strong FY27. Each business has been built for precisely this moment and each will continue to accelerate because the work we do is increasingly central to where our customers want to go.
We are approaching inflection points across several businesses at once and that is uncommon enough to deserve a real response from us. That is why we are stepping up investments now with urgency at scale with our best talent organized around an AI native way of working that I am leading personally in banking and AI software. We continue to win with multiple strategic go lives in FY26 as you would have noted, creating strong references across public sector banks across international markets. We are rebuilding the banking stack with Orion AI starting with a fully AI native trade finance platform on agentic architecture that we announced a few weeks back.
Agents handling workflows, foundation models reasoning over bank data decisions in real time. A series of AI native applications will follow each and piece of the new stack and this we will take across the entire Orient Pro stack within the next couple of quarters. That is a significant build which we intend to do through ARIA and through Lexi Labs. We are investing in proprietary research including foundation models tuned for banking in transit. We secured large strategic wins across India and the pipeline is extremely strong.
The business is becoming meaningfully more global and that will accelerate in the new year. To compete at scale, we are investing across the full stack software systems and hardware. Owning the full stack is what separates an average vendor from a category leader and that distinction matters more as the market expands. The data center business reached A clear inflection in the 526. We secured one of India’s largest AI focused data center mandates from a leading hyperscaler alongside several other wins and are fast becoming a partner of choice for hyperscalers in the AI era.
Engagements of this size carry elevated investment cycles and we have chosen to fund them urgently. The opportunity to be foundational to AI infrastructure in India is one we are determined not to miss. As we get into FY27, I think for some time we’ll see higher upfront investment than a typical year for us with larger projects bringing higher working capital needs as they scale. We would rather absorb temporary balance sheet pressure than under invest when the opportunity is this clear to us. We enter FY27 with an order book exceeding 1800 crores and a healthy pipeline across all segments.
We will remain watchful on the macro, we will remain watchful on geopolitical environment which could continue to delay some deal closures in MEA, especially as we saw in Q4. Our medium term trajectory, our long term trajectory is firmly intact and our conviction in Vision 2030 has only strengthened Change of the scale rewards firms that saw it coming as we have and prepared for it methodically. That is the work of the last several years that we’ve done at OrientPro. We are optimistic, we are ready and we intend to make this decade count for our customers, for our shareholders and people who build this company every day.
With that, let’s jump into the questions. Thank you.
Operator
Thank you very much sir. Ladies and gentlemen, we will now begin the question and answer session. Participants who wish to ask questions through audio and video can do so by pressing the right icon on the bottom of your screen and wait for your turn to speak. When prompted, you can accept the prompt on your screen, unmute your audio and video and ask questions. Participants who wish to ask questions via chat can click on the Q and A icon at the bottom of your screen and post your questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question comes from the lane of Dharmeshkan. I request you to accept the prompt on your screen, unmute your audio and video and ask questions.
Questions and Answers:
Unidentified Participant
Yeah Hi Ashesh, thanks for taking my question and congratulations on the resilient set of numbers in this quarter as entire MIT industry is struggling. But the numbers came better than what the others in the group has been doing so far. So my first question is Ashish, I mean looking at how the trajectory has been on the growth front of the revenue. So I mean 30 kind of our growth looks like a distant past right now as you see and last five quarters is the numbers you see. I mean Q4 of last year till now.
So the range has been 330, 350 to 370 grows on the top line and Q4, I mean earnings has been more reflective of the stagnants or I’m if I may say the lack of growth coming on the top line. The markets were also on the lower side. It was up 20% for Q4. It was 19% on the operating margin. If I am talking about. So I mean going forward, just in the near term, maybe FY27 and 28, how are you looking at this margin and revenue profile? Would it be we’ll go back to near 30% or we will stagnate and struggle at the same point?
This is my first question. Second I will take a post this.
Ashish Rai
Okay. Yeah. Hi Dharmesh, thanks for the question. Look, it’s hard to call so I think we clearly missed even when we entered Q4, as we were entering Q4 we were actually quite confident of the quarter. We had a good set of deals in commit and we were executing against a fairly large order book as well. So sometimes the things you just can’t predict. If I leave that aside, and we clearly missed it. So I would completely take that on as a management responsibility. If we leave that aside, I don’t really see any material change in the demand picture for this business.
Each of the segments that we bet on is only accelerating. I mean leave small transitionary events, supply chain disruptions, Middle east war aside. And you can obviously argue that it’s not transitionary and, and the sign of things to come and all that stuff. But I don’t know what I don’t know but what I do know is data center space in India. The demand is accelerating from where we sit and we’ve got a very strong order book transit. We are extremely strong right now in India. We’re executing against very large orders.
But now we are competing very aggressively globally. And we believe over the next few years we will be really meaningful global player in that space. Just because of the strengths that we built up banking, we are already a fairly significant player. Our win rates are exceptional. We got an extremely modern stack. And now like I’ve been saying the last couple of quarters, we’ve been investing heavily against our point of view on where the banking software needs to change to meet the age of agentic execution inside the bank.
And we got a very clear point of view. We Believe we are ahead of the market and we will really invest aggressively over the next two quarters to really create a stack that can compete globally. So each of these spaces we believe have extremely large headroom for growth from where we sit. And I actually other than the fact that my opinion on the long term demand, if it would have changed, it would have changed to the upside rather than downside. That’s what I can say. So I feel long term, medium term, we will continue to grow very aggressively over the short term.
We missed some events, we need to make sure we are resilient against those events and we will leave no stone unturned to plan and make ourselves completely bulletproof.
Unidentified Participant
So Ashish, I mean can you just put some number on the guidance? Like 30% was what we used to talk about. So will it be 20% plus as we ended the entire year or about that and secondly the verticals, I mean we are hearing so much about AI anthropic and all. I mean enterprise enabler kind of softwares which are coming into the play. So your banking and transition, sweet in all how it gets affected by that. I mean you, you yourself are rolling out AI products that I know. But is there any competition from platforms like Anthropic and OpenAI to your presence feed?
So that, and I mean just some number which we can work on like 10, 15, 20, what is the growth expectation?
Ashish Rai
So look, what I would advise Dharmesh is for us to like there are a few uncertain events that we don’t know how to predict for. Right. So I think it would be very unfair for us to throw a half baked number out because there are uncertainties we don’t know, especially around the Middle East. Last couple of years we had really pivoted to focusing aggressively on Middle east because we saw the spend which I think the banks still have, we saw our ability to win and it suddenly became quite important.
Now of course after this we are trying to diversify more. We actually did expand into Europe. It’s maturing slowly. We are now investing heavily in Southeast Asia. So we are pivoting to account for this. And I think over the next couple of quarters we will be much more diversified than we are right now. Right. But while we do that, I would say there are uncertain events which it makes it unfair for us to throw a number. So we will not throw. What I will say is we will continue to grow ahead of the industry growth rate.
We’ll continue to beat that by a meaningful number. I feel very good about it because just in relative terms we are extremely strong right now where the market is, we’ll see. But I think we will continue to beat the industry rates by a fairly good number as we go. And then can we meet? Is there a possibility we can meet last year’s rates or the year before? I think for sure there is a possibility, but let’s discuss that in a quarter or two as things settle down. As to what that number would be, I’m hesitant to throw a planning number out there, but we plan to continue to grow aggressively.
On the AI side, the question is a bit more interesting. So there clearly is a lot of news in the market around not just anthropic foundation models in general. I don’t really see. So the core space that we have on the banking side, that is essentially core business software that the banks use, which is where the way to look at a software is. It’s essentially a codification of the business process that the bank runs translate in the form of code. Now you’ll say, can Anthropic or any other frontier model firm come in and compete in the space?
I don’t see any immediate signs of it. Having said that, there’s obviously a lot of skills that Anthropic published out in terms of financial analysis, all that stuff. And those are, those are fine. But in terms of executing the core business process, for example, we launched our first fully AI native built from scratch software 2.0 plus agents in the trade finance space. Think of this as our vision of what the future of trade finance should look like, where you can call the whole thing a trade finance agent, or you can say there’s a next generation of banking software with agents working seamlessly inside it.
I would highly recommend you go and check it out. We believe this is clearly the most advanced trade finance platform in the market today. I don’t see any frontier model shop, or any, any model shop for that matter, trying to compete in on that. And, and we, we believe the more of these future products we roll out, the more competitive we would be and the more market share we will take. I mean, in the final picture, so in my head, an agent is essentially 70, 80% software. And then obviously you need a model to provide the intelligence behind it.
Right. The nature of the software change and hence our view on what the future software should be has changed. It doesn’t mean software itself is not needed. So that is where we are helping our banks out on the journey and we feel we will. I think we have like an opportunity to displace the legacy vendors at large. Scale across the globe if we play this right.
Unidentified Participant
Okay, yeah, yeah, fair enough. So I mean the last part remains answered. I will come back in the queue again. But the only thing is like as you said, data center is gaining traction and there would be some balance sheet strain as you are in. So does that mean margins are going to slip further from where we are? I mean 19%, are we looking at 15, 16% kind of a margin trajectory in the near term?
Ashish Rai
We’re not planning to look. I think we just, when we start taking very large scale orders, I think we just need to get better at planning the execution on these. These are not necessarily low margin orders. It’s just we got the timing wrong somewhat and I think we just need to get better at executing against this. Right. We are not planning on any significant margin dip because the scale of the orders increase.
Unidentified Participant
Thank you. Thank you so much. I will come back in. Thank you.
Ashish Rai
Thank you Dhavish.
Operator
Thank you. The next question comes from the line of Vinay Menon. I request you to accept the prompt on the screen, unmute your audio and video, introduce the firm you represent and ask a question.
Unidentified Participant
Hello. Hi. Hi sir. Hi. Thanks for the opportunity. A couple of questions from my side. One, you know our CapEx number has gone up significantly in H2. So if you can just kind of break down where is this going to and is it more TIG or is it anything else?
Ashish Rai
So capex look, I think broadly I’ve messaged the, the investment plan over the last quarter as well. Right. So I think it’s a, it’s a mix. So we now picking material transactions on the TIG side both in transit and data center. We are also investing heavily behind building the banking software stack. We are investing heavily behind building the AI stack as well. Right. So where we are looking at an increase in terms of, especially in terms of intangibles, I.e. The accelerated development cycle that we mentioned last quarter and it’s going to run for the next couple of quarters where we will build out the software 2.0 version of every single Orientpro product and we will enter net new spaces like we enter trade finance.
So you’ll see a whole stack come out over the next few quarters which is, I mean I think by our size a humongous investment in terms of software development, in terms of capability development. But we feel like this is the time to do it and we will be materially, meaningfully ahead of rest of the industry as we roll out all these products like we did the trade finance thing a few weeks back. So expect a lot of these similar launches to come through over the next couple of quarters.
Unidentified Participant
Okay. And on the intangibles and intangible under development, I think together both those line items are close to 200 odd crores. So where do we see this investment kind of peaking out and you know those numbers to stabilize going ahead and any indication on that.
Ashish Rai
On, Sorry, on where do we see these numbers
Unidentified Participant
Stabilize? That number has like really risen, you know, the last two, three years we’ve seen.
Ashish Rai
Yeah, true,
Unidentified Participant
Yeah. Going from like 20, 30 crores to 200. So I just want to know where are we going to stabilize in that now?
Ashish Rai
So look, I would think of it this way. Think of it as a short term spurt in development activity that we are funding at the moment meaningfully across three different types. One is building out a completely brand new AI native software stack. This will span trade finance, this will span transaction banking. This will span lending and all the different types of lending, corporate as well as retail. So this will span across our entire product line and we will enter a couple of new product lines. I don’t want to talk about it before we actually launch into the market, but we will enter.
So that is one. The second is extremely hard research to solve the really tough enterprise problems when it comes to adoption of enterprise AI. Right. This is. We’re building out one of the leading sort of research labs on Tableau foundation models, for example. Right. This is what Binay is personally leading. And we published Orion MSP a couple of months back. You’ll see us publish the next stronger version of it, which should do very well on global benchmarks probably in the next four to six weeks.
Right. So I think that is. Or, let’s say eight weeks. Right. So that is there, but that is just one of those things. The whole AI engineering framework, like the whole set of enterprise companies, that’s the other area. Right. The third is on the transit side. We are strengthening our software stack like we announced with mmrda, building out the back office software CCHS as well, which we traditionally don’t done. These are again very large builds. I am missing something. Yeah. Fourth is a payment site.
Right. Where again we’ve become. It’s now becoming a meaningful driver of revenue and we’ve got the scale in terms of merchants we need to build against it. Right. So I think that’s again become a sizable business and it will become much more sizable going into next year. So we need to build against it as well. All of this also in the backdrop that there is some. Let’s say there is some thought that we have around emerging risks, around cybersecurity, around what is coming, which also needs us to strengthen a lot of our stacks with some level of urgency.
Now you would have probably seen some news articles around mythos, around 5.5 security layer as well. I think there is a need to act with agency on that space where again we will pour in some dollars to build. Because honestly if you’re not doing that right now, it is a problem. Right. So there is a small window to act. So those are the sort of areas in which we are like really throwing in a lot of development dollars at the moment. I would say think of it as a short term spurt in development investments to react to one either the opportunity that we see, which we think this is the window to act and there is no other choice that is the right thing to do for the shareholder and the second is a challenge against which we need to again develop.
Right. So I think that’s sort of how I would characterize it. Happy to get into any details, but that’s basically the 30,000 foot view.
Unidentified Participant
Okay. Okay. And we had indicated that by Q4 we should see some deliverance from Europe US we are trying to a lot to enter those regions. So any update on that plus any update on, you know, Middle east and when can we see any kind of normalization there?
Ashish Rai
Yeah, so look, I, I want to say this with some hesitation, but I think we already see some deal activity restarting in the Middle East. The reality of the picture is a lot of buying processes were in very advanced stages in the Middle east across especially transaction banking, which is the main line from us but also lending also the Interact Suite. We see some increase in activity already happening. It doesn’t mean buying processes have started full steam. But what was happening in Q4 was like banks just stopped a lot of the conversations even at the final stages.
Now you see big restarting the process, restarting POCs in some cases and things like that. So I would say it’s probably coming back. But you know for sure when you know that the whole situation is under control, the war is over and we are clearly not there. But I feel we are seeing some beginning of activity in the Middle East. Europe, we’ve certainly matured. I think Phinexis is doing very well and I think it is continued to grow strongly in it. We’ve acquired more clients, we are expanding the business.
We’re also taking it outside of Europe into Middle east, into South Africa, into us. So I think that side of the business is doing well. I feel it will grow very strongly into FY27. We are now being considered for more buying processes, more RFPs in Europe. I think it’s a matter of time before we start converting that at good pace. We are in reasonably mature processes at the moment. We logged some wins, but they’re not obviously at the same scale that we do in Middle east or in Southeast Asia. But I feel like next year would be a good one for Europe.
Unidentified Participant
Thank you. Thank you. I’ll get back in line. Thank
Ashish Rai
You so much. Thank you.
Operator
Thank you. The next question comes from the line of Deepan Shankar Narayan. I request you to accept the prompt on your screen, unmute your audio and video and ask a question. Mr. Deepan, Let’s move on to the next question. The next question comes from Darshal Javeri.
Unidentified Participant
Hello.
Ashish Rai
Hi, Darshan. You’re very soft.
Unidentified Participant
Yeah, yeah. Hi. Hopefully this is a bit better, sir.
Ashish Rai
Yes.
Unidentified Participant
Yeah, hi. Thank you so much for taking my question, sir. Just wanted to, you know, elaborate more on like we are saying we’re gonna make some more investments, you know, which are going to be front ended. So will it impact our PNL or will it be, you know, rooted more to the balance sheet in terms of our intangibles and the development increasing? How would that, you know, look at, sir?
Ashish Rai
Okay, so look, maybe I slice it by the business. So there is a whole. There is. So basically every single product group is at the moment building an AI native brand new version of their product. This is, this is core software development. This is from zero software development. And everyone will do it. And I think that is where we are building out the intangibles. If the, I think at least a large chunk of it will get routed to the P and L because we are still expecting a lot of that investment to get backed up by revenue.
Of course, Q4, we struggled a bit, as you can see. But by and large I would say we will route a fair amount of that investment into pnl, especially when it’s backed by a client project. But in some cases we will need to front end it and build it ahead of the client projects. Because this is not a question of sort of responding to a client rfp. This is a question of going and getting ahead of the market. Right. So we need to invest, we need to build some of the stuff like Transit for example. I was saying, I think that is more or less in the past.
We now have built out the stack rather the back office software and all I was talking about. We are Building it, but it should be done as we do mmrda and that’s like a one off thing and it will more or less whatever expense happening after that is P and L. On the, on the AI side I think we’ll continue to build out, especially the research side. These are extremely hard problems to solve. We feel we can build out completely world class technology especially around the AI engineering stack, especially around things like explainability where we’ve talked in the past about market leading algos that we built out, especially around things like Tableau foundation models.
So we want to continue doubling down on those as we scale and commercialize this technology. And this is clearly one has to see that these are relatively less mature spaces and it will take time for this technology to mature. But then we’ve got a prostrate team, one of the best quality AI research labs, not just in this part of the world, but also extremely high quality team in Europe working at it. And we feel very good about our chances of being able to mature and commercialize that tech coming out.
Yeah, so I think that’s, that’s essentially how I would put it. You slice it into a few places. I think we, we should be able to grow strongly into next year, in which case there’ll be a lot of client projects to back up a lot of these development projects. So I think by and large think of still a short term spurt in sort of capitalized investments but it should sort of taper down over the next couple of quarters.
Unidentified Participant
Okay, so just if you quantify like in current year, how much would we have spent on our research and development and is it going to be similar in FY27? And so just another question, like the world of AI is changing so much, you know, like new products and use cases are getting, you know, you know, uploaded every day. So are the clients wanting to go for a long term contract where, you know, even something that was not heard of a year ago is now available? So what is the rate of space that you think things are changing and, and will that impact the tenure of the contract?
Like because as a client would you want to commit for five years when you don’t know the product is even going to be viable after five years? Or how do you mitigate that?
Ashish Rai
Yeah, so look, we’ve not really seen any material change in the software buying behavior, especially in the banking world or even in the transit world or any of the spaces we are in. I don’t think there is any difference in the term of the contracts when you buy a piece of Software as a bank to support one of your core business processes, whether it’s transaction banking, it’s cash, it’s trade, it’s liquidity management or it’s on the lending side. I don’t think you can buy with a short term time horizon in mind because it’s not just software.
You’re building your whole business process around it. You are right to think that there is change in the market, so you will obviously want to buy from the perspective of what is my readiness for that change. So if you buy a software today, the reason we win a disproportionate number of deals when we go and compete these days is that readiness for AI angle. It’s not that I stopped buying software, but you want to buy with the perspective that is the stack ready for the future or not. That’s why we are investing so heavily to stay ahead of the market.
I don’t think the need for software is going away. It’s not even a question of thinking. I think anyone who thinks the need of software is going away really is not thinking straight. Because there is no conceivable way in which you can run a business process inside a bank of an LLM or you call an agent. Now, like I was saying, an agent would end up being 70, 80% software and then intelligence model or LLM to back it up. Right. That is entirely conceivable. Right. And that is probably how it will be and that’s why we rebuild the new stack.
Right. But the fact that you say I would not use any software, I don’t think that future is anytime near. Right. And anyone who thinks this through would realize you probably need a slightly different type of software. That is for sure. But you do need software. And when you buy software, you cannot buy with a time horizon of one year because it’s a massive investment for the bank to sort of shape its work processes, to shape its operational processes around that piece of software. It takes a very long time to implement.
It takes a very long time to test. You want to buy for the next 10 years, you want to buy for the next 15 years, you don’t want to buy for the next two years.
Unidentified Participant
You know, our research cost. I, I
Ashish Rai
Can’t, Sorry, the line is a
Unidentified Participant
Bit covered. Yeah, yeah. So I was asking how much have we, you know, invested in terms of research in FY26 and what do we plan for FY27? Just why I’m asking this in terms of margins, we should be at the similar range. What you’ve done, right like overall for the full year. That’s why I’m asking.
Ashish Rai
Yeah, look. So there is a short window of time to react. Right. My best guess is we are talking of a number somewhere between 150 and 200 crores. The reason I say it’s a guess and it’s not a planned number is we are working through some very specific productivity improvement measures right now which we feel will be a fruit in terms of the size of investment that we need to make especially around software build outs. So over the last six months we have invested heavily behind AI development stack, AI based code generation, an extremely modern development stack that we feel is beginning to give us material productivity improvements.
So it will meaningfully reduce the size of that spend to the extent that I can get that productivity gain. And we are like we are sharply focused on getting it right. So I would think the number is somewhere between 150 and 200 crores over the next four quarters. But we are working very hard to drive productivity improvements and try to shrink it.
Unidentified Participant
Yeah, I just saw the last question.
Operator
I’m very sorry to interrupt you. Could you please join back the queue please?
Unidentified Participant
Yeah but I just asked the question previously also about the.
Operator
There are many participants waiting to ask questions. Sir. Please join back with you sir. Thank you. Yeah. Next question from the line of Kuber Jitendra Chauhan, I request you to accept the prompt on your screen, unmute your audio and video and ask questions. Mr. Kuber Jitendra Chauhan, could you please unmute your line and speak.
Unidentified Participant
Am I, am I audible now?
Ashish Rai
Yes.
Unidentified Participant
Yeah. So Ashish, you said that we have seen some weakness in Middle east, right. In terms of geographical wise. So what has led. I mean it consists around 3% over revenue. So what has led, led to the major dent in the revenue in Q4FY27. In Q4FY26. Sorry. And do you anticipate it to continue in Q1 as well?
Ashish Rai
Yeah. So it’s not, it’s not 3% of the revenue. So look I can speak in terms of what our planned execution numbers was. So when you look at banking there is some dependence in terms of one off licenses. And walking into Q4 we had a number of deals across our product lines especially around transaction. I can interact that, I mean that are still there. It’s not that the deals have gone away but which are material sort of license revenues which did not really translate right. It is certainly way north of that 3% number that you’re throwing at me.
But I don’t Want to throw numbers on this because I think that’s not the point. The other is we announced last year when we actually entered Middle east in a meaningful way, a number of wins in the market. All of those, especially with some Saudi Arabian banks and all that we announced, all of those are in execution right now. They’ve been in execution over the last year. We were expecting to take them to go live. We have been for various reasons, or rather for known reasons, not been able to put teams on site, on the ground to drive the execution faster.
And that has also slowed down the execution. So the Middle east impact actually ended up being a double whammy. It’s like not just deal closures and the license revenue coming from it, it’s also project closures and the revenue conversion from it. Right. Having said that, like I said, we should have planned for it. Of course, walking into Q4, we were very confident of where we’ll end up and we did not, which clearly is a gap in how resilient the setup is. We should plan for such roadblocks and we’ll try to plan for it for it more.
Right. But that is essentially the impact. That’s not the only thing. The other thing that I mentioned right up front was obviously the very large hyperscaler contract that we signed and which needed us to invest or other needed us to start and start investing and we mistimed that as well. And that is a very large order. As we know there’s a 350 crore deal and yeah. So you should, we should just plan it better.
Unidentified Participant
Got it. And do you see our order book to be growing in Q1FY27 as well? Have we seen any kind of budget constraint from any of our clients, India or globally due to this macro uncertainty?
Ashish Rai
I would say to some extent you may see some decision making slowdown for sure. Of course there is a lot of pressure on banks to consider actions around AI. Like every firm, every serious firm right now looks at that as a separate sort of strategy item, separate investment item which you need to prioritize somewhere. So I think to that extent you do see banks considering it as OrientPro itself does. Right. So I would say every serious organization has to and they’re doing it. Cybersecurity is another area also which every serious organization has to and they have to do it, including OrientPro.
So we would expect our clients to as well. So to that extent you can argue there is some sort of delay in decision making because banks consider their priorities. Having said that, whether you look at India, where We are a big player in the public sector banking space. In the private sector banking space or wider South Asia or Southeast Asia, we see more or less the same number of RFPs come out, the same buying processes run out. MEA is a bit slow at the moment, but I fully expect that to come back.
The moment situation there stabilizes and US and Europe are very small for us. So I don’t think it really matters.
Unidentified Participant
Okay. Okay. Can we see the stabilization?
Ashish Rai
Yeah. Look, I think the demand situation has not meaningfully changed in my view. The decision cycles may stretch a little bit, but I think, I think the business overall will do better. We’ve been growing again, like I was saying in the opening remark, we’ve been growing at breakneck speed for five years. So we were obviously stretched and we just need to be, to be better and more resilient as we, as we build this business further. But the demand situation hasn’t changed and I feel very good about us continuing to grow strongly and continue to grow higher than the industry number for sure.
Unidentified Participant
And last question. Do you see our revenue mix to be the same? Like TIG will dominate the banking vertical in FY27 as well?
Ashish Rai
Yeah, I don’t know about dominate. So I think banking probably ends up being slightly more than 50 and Tig ends up being slightly less or thereabouts. But one quarter to the other it will change. I would say the change in mix will come down to difference in relative growth rates. We are picking up larger orders on the TIG side. Right. So I would say there is a possibility TIG grows a bit faster going into next year, but longer run. I think it’s a wash. I don’t think there is going to be a meaningful difference in relative growth rates between the two verticals.
But yeah, I mean from one half to the next things can move here and there a little bit. Thank you and all the best. Thank you.
Operator
Thank you. Participants who wish to ask questions through audio and video can do so by pressing the raise hand icon at the bottom of your screen and wait for your turn to speak. When prompted, you can accept the prompt on your screen, unmute your audio and video and ask questions. The next question comes from the line of Manav Medivala. I request you to accept the prompt on your screen, unmute your audio and video and ask a question. Mr. Manav, could you please unmute your line and speak? Sir,
Unidentified Participant
Can you hear me?
Operator
Yes, you’re audible.
Unidentified Participant
Average book to revenue conversion cycle across key businesses like banking platforms, transit projects and data center. And how much of the 1800 crore order book you see as executable in FY27? And additionally, if the geopolitical situation in the Middle east were to persist, let’s say for another quarter or so, how might that impact order inflows, deal conversions or execution timelines going forward? And how do you see AI shaping both the speed of conversion and nature of deal wins? Do you see some kind of pricing pressure as well?
Or do you think you can command a premium on the work that you deliver?
Ashish Rai
So Manav, I feel like I may have missed something at the start. Maybe the line was not very clear. I picked up three questions, I’m going to answer those and if I miss something then just come back in and let me know. So how much of 1800 crore order book is executable over the next 12 months? I would say something in the range of 70 odd percent, maybe slightly less, let’s say between 68 and 72% or something like that. The slight question mark there is because of some genuine supply chain disruptions, because of some genuine Middle east war sort of issues, some of the execution is constrained.
We feel like it’s coming back, we feel like it should be fine, but we don’t know for sure. Right. So I think that is sort of one slight question mark I’ll put against that answer. But otherwise that it’s somewhere between 68 and 72%. The geopolitics side of it. What happens if this goes on for another quarter? So we’ve been asking that ourselves and trying to prepare for it. Like I said, the goal of an organization should be to build resilience to such shocks. I mean, obviously we cannot predict it, but we can react better to it than we have.
And our response to that has been to really double down on, get much closer to our customers and prospects in Middle east really action that well. So we feel that there is some momentum that’s coming back even though you’re acting remotely and all that stuff. We feel like we’ll still be able to get our projects across the line and convert revenue. And we have really been pushing heavily in Southeast Asia and Europe too to try and account for the slowness that may happen in the Middle east and India as well.
So we feel like if you say over the first half of the year, I think the demand should balance itself out because we got finite capacity to execute and I think we’ll be fine. Where the problem comes in is not so much from the demand sort of slowing down. So we are in several segments where the segments Will load balance the demand. I think the challenge comes in is when we walk in and invest with the confidence that the revenue is going to happen and it does not happen. I think that causes a lot of problems.
So like I said, Even walking into Q4 we were very confident of where the revenue is going to be. And obviously you fell more than 100 crores short of it. So that like investment in your expenses beforehand and then missing the revenue, that is what causes the problem. So we just have to be more conservative in how we plan some of these front ended investments and we are doing that. So I feel like one, we will double down on geographies which are like Southeast Asia and Europe. Second, we get much more closer to our customers in Middle east which we are doing.
Getting where you would have called twice, you called 10 times. But you just focus on the customer because at the end of the day that is what matters. Get the projects across the line, get the deals across the line. So we are doing that. And then the sort of the demand across the territories load balances itself. Do not be very conservative in front ending costs. I think that’s one lesson we’ve learned and we will. I think it’s a function of just growing at the pace we’ve grown. Four years back you’re a 375 crore firm.
Today you are a 14, 1500 crore firm. You are four times the size. Even small leg up in investments actually means hundreds of crores. So I think that learning is a key one which will put us in a good place as we exercise more caution when it comes to upfronting costs. I think that’s sort of my thoughts around it. But I would say judge us by our actions and results. I think we missed a couple of clear things. Shocks are shocks, they happen and the entire industry gets shocked. But how you react to those shocks you can get better at.
And. And yeah, those are the actions we planned. But we planned a whole set of actions around it.
Unidentified Participant
Okay. Okay, got it. I’m very sorry
Operator
To interrupt you. Mr. Malav. Please join back. Thank you sir.
Unidentified Participant
Okay. Sure.
Operator
Thank you. Yeah. The next question from the line of Avi Javeri, I request you to accept the prompt on your screen, unmute your audio and video and ask a question.
Unidentified Participant
Yeah. Hello.
Ashish Rai
Hi.
Unidentified Participant
Yeah. Yeah, hi. Ashish. My question is with respect to the direct cost associated with the product licenses and hardware, I believe that has materially come came down over the last three quarters. I believe primarily you mentioned owning the entire value chain. So if I calculate the margin or contribution margin to it. So I have seen a meaningful improvement. So what do you see that the past three quarters the contribution margin would sustain on equipment and product license and what are the reason for this improvement?
Ashish Rai
Yeah, so I mean, good question, right? So I think the way to think about it is this, right? Where we own the whole stack, for example, in the transit space, as you point out, where we own the whole stack. The reason we get into that owning every point on the value chain is because we do see that the economics of the business fundamentally changes when you own every point on the value chain versus be a point provider in large contracts. Right now we have the strategic flexibility of being a point provider on larger global consortium where we need to.
But then in India, for example, do the whole deals end to end and the margin does materially improve when everything is ours. And that is a very new thing for us as well because we’ve been investing heavily in that R and D. But only now you see the whole stack getting complete. And even now, therefore, mmrdi, we’re kind of finishing up the software side and all like I mentioned. But once you have that, I think your economics are really very, very strong and I think that is what we’re aiming for right now.
I would say what you see is not the end economics because the reason a lot of it gets masked is because we’ve been growing at a very strong pace and when you are adding on a lot of projects, you are taking on some cost which won’t exist when you are steady state. So the margins that the business delivers once it reaches a maturity and is growing at, let’s say single digits or low teens would be meaningfully better than when the business is both investing right now at the speed it is and growing at the speed it is.
Right? So I would say look over the next couple of years as the business matures, I feel strongly that the margins will get even better. But you’re right, as you own the whole stack, they keep going up, right? The same thing on the software side as well. The only slight difference that happened on the software side is as I think everyone who’s been following us for the last four or five years know, we invested heavily in rebuilding the whole stack. We believed we had the most modern stack in the market, which is true.
But the need to reinvent the whole stack we were not anticipating which came in recently. Right? So although we had the most modern stack in the market right now, we’re determined to really go one step up and rebuild the whole stack again, which we were not Expecting So that will temporarily actually bring some of your margins down to the extent that you’re expensing some of these investments. But longer run. That same logic applies to software as well as we were seeing over the last couple of years is just that the changes that happened in the market that we now need to react to.
Right. So that’s how I would sort of characterize it. Applies to the hardware, to software stack, applies to the software stack, applies to banking, applies to transit. And you should see the contribution margins meaningfully go up, steadily go up. But you will see the actual final end state only when the growth rates come down.
Unidentified Participant
Got it. That was helpful. Thank you.
Ashish Rai
Thank you.
Operator
Thank you. The next question comes from the line of Varun Gandhi. I request you to accept the prompt on your screen, unmute your audio and video and ask a question. Mr. Varun Gandhi, could you please unmute yourself and speak, sir?
Unidentified Participant
Hi Ashish. Hi Varun. So my question is mostly on the cross sell and upsell side. Since we have already have an existing marquee client base and we’ve always found success in converting new clients. Just if you could share your strategy about upselling other modules within your trade finance or your or your other modules that you could use on your existing distribution channel. If you could elaborate over there and if we found any, if you could share some instance where we found success in executing such a strategy.
Ashish Rai
Okay, great question, Varun. Right. So I think, you know, longer run, what happens to a mature software business is I think as we get to a steady state we probably should be able to, or even now we probably should be able to grow 10, 12% even if we don’t sell a single new logo in the banking space. Why does that really happen? Is essentially what you point out. One, ability to expand the current sort of footprint that you have in a minor way around new modules, new regulation, all that stuff. The second is our ability to add products next to it.
So for example, I am in a bank with cash. Can I add liquidity next to it? Can I add liquidity management next to it? Can I add virtual accounts next to it? Can I add trade next to it? Supply chain finance next to it? And I think that is probably one of the most efficient ways to grow a software business. We exist as a provider of specialized software. So when OrientPro looks at a product, and many of you have heard me before, so it’s probably a repeat of it, I have only two asks from a product business inside OrientPro.
Ask number one, product superiority. When OrientPro builds a product how are we better than any other option the client has available? It doesn’t need to be 100 things, can be two, three, four things. That clarity goes into the roadmap. The roadmap goes into the product. You build an extremely good product. Right. Ask number two is never fail a customer. When someone decides to trust OrientPro with business, we make sure the client succeeds no matter what. As long as we stick to those two key principles, we keep our clients forever and clients.
And we are a partner to those clients. We are at the center of change that they are facing and it gives us enormous opportunities to keep helping them with more change, which means add more product, add more software. What do you need to expand in that way? You need a very big surface area of products. Why is it that we’ve expanded our stack so much over the last couple of years through acquisitions? Through our own build out, we acquired infrastructure, we acquired Omnifin, we acquired Fintra, we acquired Aria.
So we’ve gone in and added net new products into the mix. It’s essentially for what you say, cross sell upsell, right? Which means how can I be a much more meaningful partner to the same bank rather than every time go out and sell to 20 more banks? Right. So while we want to grow at 30, 35%, we still want to keep acquiring a lot more new logos. But at a point where new logos dry up, you can still grow from your existing base because you can add more and more product. And a lot of these investments we are making, a lot of the acquisitions that we do, which we may still meaningfully do, will go towards expanding that surface area and expanding the relevance of OrientPro to their bank.
So I think that is essentially how we’ll play it. I think right now in terms of success stories, I would say we work with most large Indian banks. And if you look at Indian banks, typically we were at probably 1.5 or so product per bank. I think now we are probably north of two products per bank. But there are banks which are using five or six products from us. And I think that’s where we would want to take most of our banking relationships. Where an average relationship we have is across 5, 6, 7 orient pro solutions that sing and dance together.
There’s an enterprise AI partnership which is meaningful to the bank and maybe there is even a relationship around transit, around payments, around a lot of other areas that we are in. So I think that’s sort of the ideal configuration for us. We will keep pressing on it. And I think the strategy is working. It needs to Work at a larger scale.
Unidentified Participant
Got you. So from what I understand the implication is that we’re trying to build the horizontal product stack. We’re not yet very aggressive in trying to capture additional wallet share from existing clients. Is that a good understanding?
Ashish Rai
So we are still relatively small in terms of size. I think we have built out a relatively meaningful account management program. We are pushing but I would say you are right in the sense that I think we can push a lot more and we are slowly maturing there. Right. So I think right now there is a lot of single product relationships and to that extent I think you’re right. But we are pushing towards it.
Unidentified Participant
Got you. Just as a last follow up, what’s on? Any update on the NBFC platform that we had launched earlier this year? Any meaningful
Ashish Rai
Look? NBFC space in India? I think we now have north of 30 clients, some fairly large size NBFCs. We are very competitive in the space, I expect. So we don’t. I think we got a policy around the size of deals that we round. So we don’t always announce NBFC wins because just the value of the deals tends to be not so large. But expect us to win some major, some really meaningful deals in that space. I think we are one of the more competitive players around in that space and some of the really prestigious deals coming in the market, I feel like we will win those.
I think we’ll look at the policy and all and where we announce, maybe we announce a bunch of them together so you’ll see more sort of visibility around it. But I think it’s north of 30 clients now and it will only grow.
Unidentified Participant
Thanks for sharing the ethos of the firm and sharing the details. Hope to catch you next quarter and we’ll make up for this quarter’s backdrop. Thank you.
Ashish Rai
Thank you.
Operator
Thank you. Next question comes from the line of Yash Gupta. I request you to accept the prompt on your screen, unmute your audio and video and ask a question or give comments.
Unidentified Participant
So my question is on data center. What exactly our role in the data center deal that we have got recently. One is 350 crores and another one is the Brownfield facility in Mumbai. Can you throw some light on both the deals?
Ashish Rai
Yeah. So we announced a bunch of data center deals. Of course the really large one. Look, what we do on data center projects is first it’s a very capital light business for us. We essentially provide services in that space. We run one of the top design teams in that space. So we do help around design of the data center. Some really complex ones around integrated engineering on the data center and program managing the whole build for the data center as well. Right. So it depends on the nature of engagement.
But in both of these cases and increasingly in a large number of cases, cases which we’re discussing as well, we will do all of the above. Right. So we will do. We will obviously continue to pick up only specialized design deals and all because they tend to be really high margin and we like doing those. But you will end up doing the entire spectrum design, integrated engineering program, managing the whole build, handholding the strategic partner right through the process. But it’s pure services
Unidentified Participant
And anything on this revenue recognize and when we will going to recognize this revenue.
Ashish Rai
So we faced some delays in terms of project execution like I said, but I would say a fairly large chunk of it within the year.
Unidentified Participant
Second question in your presentation you have mentioned like in FY27 we need to absorb some transit balance sheet pressure. So is that only will be a balance sheet on the working capital side or it will be on something on the debt side or maybe some P and L heavy transaction.
Ashish Rai
I don’t anticipate debt side debt to the extent that we need to maintain some things in some banks because of some businesses here and there I think that’s different. But on the net I don’t expect we are more or less comfortable in terms of the overall cash position. We are obviously focusing right now in terms of shoring up that position. So the balance sheet is healthier. So I don’t expect us to go in on the debt side. So basically it is let’s say the growth oriented side of the balance sheet which is where I say expect some transient pressure because we are taking on very large contracts which will have working capital impact.
We are making significant build outs of product, especially the AI native stack which means fair amount of investments on that side. But I did not mean that.
Unidentified Participant
Can you just quantify the working capital requirement in terms of number like from here where it will going to be like 200, 300 crore plus here on there or maybe more than that.
Ashish Rai
Yeah, look, I think roughly around there. Right. But one of the things that we are trying to do is to really make the business more efficient. Right. So one of the things that we will try to get into is how can we get even tighter in terms of controls that we have on the relationships and the contracts that we take on. I feel like the 200, 250 crore sort of number is the right number. But we have some very specific plans around trying to make the business more efficient. So the reason I made that statement is I want us to be aware that so there are things you know, there are things you don’t know.
But as you become larger and we start taking on meaningfully larger contracts, like I said, even if you go 12 months back, we would not do, we would probably do 100 crore deal in a year. Now you’re talking a 350 crore deal, a 250 crore deal, a 150 crore deal and 100 crore deal. These are meaningfully larger transactions and as you do those, obviously they sound like very good ones to do but you need to be prepared to do it right. But having said that, I think we are trying to also get efficient in contracting, efficient in the payment terms, trying to see to what extent we can minimize that.
So it’s a work in progress but I feel you’re in the right ballpark.
Unidentified Participant
Sure. Thank you.
Operator
Thank you ladies and gentlemen for the day. I now hand the conference over to Mr. Ashish for his closing comments.
Ashish Rai
Okay guys, so thank you for taking the time out of your days to come and join us. Q4 of course was not the best quarter and I’ve been quite upfront with where things could have been better. I think the important thing about building a business over the long run is not sort of events which surprise us. It’s not so much around challenges that suddenly come on. It’s around how you respond to those challenges. I feel where we have built out the core DNA of the firm over the last few years is in how we respond.
We are very clear eyed about things we can change. We are very clear eyed about how large we’ve become and the scale of problems even relatively harmless misses can cause and we will tighten the controls. I remain as optimistic as I was if not more around the demand for each of the major bets that we place in the market data center space. It’s extremely strong demand. I feel no problems in our ability to able to grow fairly strongly transit space. We are extremely competitive and it’s a large global space.
I don’t see any problems medium, long, short, any term over demand in that space. We need to execute well banking. We’ve established ourselves as one of the most credible vendors in the space and I am convinced we are ahead in our point of view on where the the combination of the next generation of banking software and agentic execution needs to go and we are right at the center of it in terms of helping our clients do it right. So each of the bets we placed payments is also coming out to a meaningful size now, and it will grow over the next few years.
So no matter which segment I look at it, I am extremely optimistic about the demand. We need to really tighten execution and we need to continue to scale the business in a disciplined way, which is what we will do. And we’ll talk more about it as the next few quarters come in. And I would say judges, by results and actions, I mean talk is cheap. So with that, thank you for taking the time out of your days, and I’ll see you again next quarter. Thank you.
Operator
Thank you, sir. On behalf of oran Pro Solutions Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.