Cyient Limited (NSE: CYIENT) Q3 2025 Earnings Call dated Jan. 27, 2025
Corporate Participants:
Krishna Bodanapu — Executive Vice Chairman & Managing Director
Prabhakar Atla — President and Chief Financial Officer
Analysts:
Sulabh Govila — Analyst
Sandeep Shah — Analyst
Sudheer Guntupalli — Analyst
Bhavik Mehta — Analyst
Mihir Manohar — Analyst
Presentation:
Operator
Confirmed. Please wait while you are joined to the conference. The conference is now being recorded ladies and gentlemen, the call will begin shortly. Please stay connected. Thank you the conference is now being recorded day. Ladies and gentlemen, good day, and welcome to Scient Limited Conference Call. 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 than zero on a touchstone form. Please note that this conference is being recorded. I now hand the conference over to Mr Krishna, Executive Vice-Chairman and Managing Director at Scient Limited. Thank you, and over to you, Mr.
Krishna Bodanapu — Executive Vice Chairman & Managing Director
Thank you very much and good morning, ladies and gentlemen. I am Krishna, Executive Vice-Chairman and Managing Director. And present with me on this call is Mr Atla, President and Chief Financial Officer. Firstly, I want to thank you very much for taking this time on a Monday morning and we are having this call because we have received numerous requests for clarification on few of the statements made in the FY ’25 Q3 conference call, which was held Thursday last week. We decided that it was best to address them in an open forum, which is the purpose of this call. I would like to mention that some of the statements made in today’s discussions may be forward-looking in nature and may involve risks and uncertainties. A detailed statement in this regard is available in our investor website, which is also posted on our corporate website. I will make the opening remarks and then open the floor for Q&A. The first thing that I really want to reiterate is to say that from an operational perspective and the business perspective, the business is stronger than it has ever been. You saw the order intake number for Q3, which is the highest it has ever been. But I also want to reiterate that the pipeline is the highest it has ever been. The order intake was the highest it’s ever been and the large deals, there were 13 large deals in the quarter itself and those are also the highest they’ve ever been. So I’m very proud to say that from a business perspective, we are in a very, very strong footing and I just want to reiterate that there is no further update that I can provide from a — from a business perspective other than to say that things are going well. We are setting ourselves well for a strong growth Q4. I want to reiterate Q4 will be a — will be a decent growth quarter. And then I will request my colleague to give a little bit of color on FY ’26. But again, at least from a business perspective, I do want to reiterate that we are in a very, very strong wicket and I’m very proud — incredibly proud of the work that the team has done to get us here, which will only serve well going-forward. And now I do want to address the issue of transition. As you know, Kartik was an extraordinary leader who has served us exceptionally well. I also want to reiterate one thing that the separation or the transition that is being planned because the transition is not done, and I’ll explain that in a minute. The transition is being planned is in-line with what Karthik and I have agreed. Karthik has been extraordinarily supportive of the transition and has also only stepped down as the CEO of the company. He continues to remain an employee of Scient Limited and he continues to be an adviser to me through the transition period and we will only step off from the employment of science at a future date, which is to be decided. I want to again thank him and I perhaps didn’t do a good job on Thursday because of various things that were going on and various things that needed to focus on. But I just want to in front of everybody reiterate to you that Carpit has been a thorough professional who has really helped with the transition and who is acting with the utmost integrity and the utmost interest of the company and for which I will always be grateful to him. And many of you may have also seen the heartstrent post that he put on LinkedIn the other day and we continue to remain great friends. And I want to say that there is nothing to this beyond the fact that Karthik and I over the last few weeks have sat down and had numerous discussions and came to the conclusion that the transition was the best thing for him and the company. Now the reason why it was announced when it was is because now both the company and Kartik have to plan for the next steps. And once we start planning those next steps, a lot of things start to start to emerge, a lot of people find out things and these are customers and employees and potentially whatever next steps in his career are. So taking all that into account, we thought it was best to be transparent and announce this transition as it is rather than try to hide under things or hide things and therefore, we announced it when we did. We — of course, there’s always lessons learnt and on a lighter vein, I’ll say, I hope I never use these lessons ever. But there’s always lessons learned. We could have done things a little bit differently. But the reality is the Board decided that this was the best way and we believe that we will be able to manage this transition very, very well. In terms of what happens next, personally, I want to say that this is not something that — and this is not the role that I want to discharge from any long-term perspective. I am very, very proud of where science has evolved with Scient DLM and what is happening with Scient DLM and the opportunity that presents. With Science semiconductor, which you — which you will recall, we announced last quarter has been spun-off as a different company. We now have the leadership starting to fall in-place and formerly semiconductor will start operating come the 1st of April. With all that is going on, I believe that I can add a lot more value in managing these various parts of science and various pieces of science. And that’s where I would like to focus on because that’s what I can add most value. Sorry, for that to happen, obviously, there has to be a strong leadership in DEP. And I have agreed with the Board and the NNR committee or the NR — the Nominations Committee also is fully involved in the conversations on what is the transition. And I want to reassure you that my taking on this role is only interim and I want to reassure you that we are very confident as a Board that we will have a clear plan presented to you no later than the end of this quarter. There’s a number of things going on evaluations with both internal candidates and external candidates. A large global search firm has already been appointed. They are also working on evaluating and giving us a good assessment of both internal and external candidates. And I will say that from my personal perspective, nothing will make me happier than to see a strong CEO in-place because I can then move on to doing things where I believe I add most value to science, both from a strategy perspective and the governance perspective and not in the strategy just for the BET or the engineering business, but for the strategy — for the group because there’s a lot of things that are happening in the technological world where science is uniquely positioned and that positioning is what I want to build-on. And if I may, I think that’s what I’m really good at and that’s what I can add most value. So in that context, I want to reassure you that this is only an interim step. No later than the end-of-the quarter, again, I will say we will present to you a solid sustainable day forward and a lot of work is identified on this. And our LNR committee is fully, fully involved and I also thank them for the amount of effort they’ve put in the last couple of weeks on just helping me think through this transition. So net-net, I will again say that it was a bit sudden to call this salt because I wanted to make sure that we have an open forum and an open conversation and not give out any selective information. But I also wanted to do two things. One is to reiterate that the business and the financials of the company are absolutely solid and I feel very confident where we are going with them and that we will deliver some good results for Q4 and for FY ’26 and will just give a little bit of color on that. And that also to say that the transition has been planned, has been agreed with Kartik. I want to thank for being an absolute professional and an absolute friend in helping me think through the transition. A lot of what is happening is also based on his advice. And also for executing it in a seamless manner such that we are really protecting the interests of our shareholders, interests of our customers and alignment of our employees. So I’ll just say that, yes, it seemed a bit sudden on Thursday, but it’s something that’s been very well thought through. I’m on-top of things for now. Again, I want to say for now because this is an interim — interim arrangement that we have come to, but I’m very confident that end-of-the quarter, we will have a more solid long-term arrangement in-place. And I assure you that you will hear a fully executed plan by the end of this quarter. With that, I’m going to hand it over to Prabhakar for a few minutes, just so he can highlight some of the numbers just to substantiate what is happening in FY or in Q4 in FY ’26 before we take it or pass it over for Q&A. Them. Basir, over to you.
Prabhakar Atla — President and Chief Financial Officer
Thank you, Krishna. Hello, everyone. Thank you for your time today. I’d like to address two topics today, which perhaps were not adequately addressed in the previous earnings call. Call and my comments on this call are specific to DET and DET only. So these two topics would be what is our current outlook for Q4 FY ’25 and for FY ’25 in all? And the second would be, what is our outlook for FY ’26 and where does our confidence arise from? Thank you. In terms of the outlook for FY ’25 and Q4 FY ’25, here is where we stand-in terms of revenues. As we all know, we had a very strong quarter three with 2.4% revenue growth quarter-on-quarter in constant-currency with two large and important verticals, communications and transportation leading the growth. As Krishna pointed out earlier, we had a very strong order book in Q3, which is the highest-ever, which is up by 5% year-on-year. Adjusting for tenure of purchase orders, which is this year compared to what they were last year, this growth would be much more than 5% in like-to-like terms. But these orders came in Q3, which doesn’t leave us with enough runway to execute fully in Q4. Hence, we’ve taken a conservative view of how much we can execute in Q4 and fine-tune our guidance now for the full-year as a final update to the guidance we provided previously at the end of Q1. Even with this conservative view, we do not see Q4 as a degrowth quarter in constant-currency. We do expect FX to be a headwind, but currency-adjusted, we do not see Q4 as a degrowth quarter for revenue. And like previously commented, at the end of Q1, H2 will definitely be stronger than H1 in the range of 3% HOH growth in constant-currency. And we do have — and we will have growth momentum with us as we execute or as we exit FY ’25 with three consecutive growth quarters. We grew the business in Q2, we grew the business in Q3 and we expect marginal growth in Q4. And therefore, we expect that the growth momentum will be behind us as we — as we exit the year in terms of revenue outlook. On the margin front, our margin is absolute and not in constant-currency. We did have a headwind to our margin in Q3 due to FX and we are not currently sure of how much impact currency will have on margins of Q4. So, we are guiding for 13.5% as the Q4 exit margin on which we have a very good degree of control and we’ll work on what this we can execute on the top of that versus the levers we currently have in-hand. So in summary, as we exit FY ’25, here is how we see our business. So on the back of the 12.6% growth in revenue we had in FY ’24, which was a very good year, we expect a revenue de-growth in the current year in the range we have provided previously in the previous call. But we will also exit the current financial year with very, very strong financial metrics, especially around debt, around cash and FCS. If you look at our debt, as you all know, two years ago, we had $90 million of debt in business and as things stand today, at the end of Q3, we were able to clear all the long-term debt we had. And as things stand today, we did not have any debt on our books, long-term debt. Our cash-in hand is extremely strong at $134 million, an equivalent of about INR1,100 crores, which gives us a required order to execute growth plans that we currently have in-hand for FY ’26 and going-forward. Our HCF continues to be extremely strong over the past several quarters, hovering at or above 100% every quarter. So therefore, we believe they’re going to exit FY ’25 with very strong financials as a good platform to drive the growth that we plan for in FY ’26. Now moving on to the second question that I wanted to address, what is the FY ’26 outlook we have as a company for DET? And from where does our confidence arise from? Krishna talked about this before, we are looking at the following three objective metrics for a view on FY ’26. First, the sales pipeline that we currently are looking at is the highest-ever we had for business. It has improved significantly year-on-year and quarter-on-quarter. We spoke extensively about order intake for Q3 being the highest-ever. We also spoke about the large deal momentum, 13 large deals won in Q3 alone. So a combination of these three objective metrics that we track. Plus, as a result of various conversations we’ve been having in the last quarter and in the last one month, we see the client spend sentiment in key verticals has improved significantly compared to the previous quarter and compared to the previous year. This is the ago and this is the exercise that we are currently going through to fix the budgets that we will run for FY ’26, we are confident that FY ’26 will be a growth of a year of revenue growth once again. FY ’26 will be a year of revenue growth once again. And unlike FY ’25, growth will be spread throughout the year and will be from H1 onwards and not back-ended like we had in FY ’25. We also expect EBIT margin expansion in FY ’26 coming from three areas. One is obviously the revenue growth. The second is, as you all know, in FY ’24, we ran a very structured cost optimization program in the company because of which we were able to bring significant control on the margins that we delivered in the tier, taking them all the way to 16%. And we are now embarking on executing the Phase-2 of the same program which is already in-place in Q3 FY ’25 and we will execute through Q4 also, benefits of which will flow into FY ’26. The expectation is that this program that we’re running right now will give us a margin expansion assurance of about 100, if not 150 bps for FY ’26 on EBIT per month. And the current lever we are working on currently consistently is the offshoring percentage. As we all know, given the major business that is global for us, given the recent acquisitions that we made across various countries in the globe, our offshoring percentage is very modest and moderate. We’ve been working diligently in the past few quarters to work on enhancing that. And we believe that will be a very important lever for us and the lever that we currently have in-hand to improve the EBIT margins in FY ’26. And as you all know, as a company, we have demonstrated significant discipline in terms of how we can control our margins, which we have shown in FY ’24. And we’ve also not stopped any investments in FY ’25, given the order backlog, given the order pipeline that we have and we will continue to make those as we see. This is all these things we see the following outlook for FY ’26. One, we see it to be a year of revenue growth. We also see it as a year of margin expansion and we also see that the growth that we expect in FY ’26 will be throughout the year and not back-in there. That’s the summary of the comments I wanted to make on Q4 and FY ’25, most of the outlook we have in FY ’26. With this, thank you for your time. I’ll hand over the call-back to the moderator for opening up the floor for Q&A. Thank you.
Questions and Answers:
Operator
Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question, press star and one on touchstone telephone. If you wish to remove yourself from the question queue, you may press star in two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question comes from the line of Godila with Morgan Stanley. Please go-ahead.
Sulabh Govila
Yeah, hi. Thanks for the opportunity and thanks for keeping this call. First is, you know, I just wanted to confirm if my understanding is correct. So what we’ve said is that there is a plan in-place and in the next two to three months, we’ll have a transition plan with probably a longer-term transition plan with probably a new candidate in-place until that time is available for the transition is. Is that understanding correct? Hello.
Krishna Bodanapu
Sorry,, I was unmute. I’m sorry. No, you’re absolutely right. Till the end-of-the quarter, he will be — at least till the end-of-the quarter. That’s when we said we’ll review it again. At least till the end-of-the quarter, he is available as an adviser to the company to help with any transition, be it any employee-related issues, any customer-related issues, etc. So you’re right, he will be available till the end-of-the quarter. And like I said and what you said or what you summarized, by the end-of-the quarter, a full-time plan will be in-place or long-term plan of full-time so long-term plan will be in-place to the new CEO.
Sulabh Govila
Okay, okay, understood. The second is a question based on the comment that you made last — in the last call. So we had sort of said that there are some of the areas where we find opportunities to fix in the company. So I just wanted to understand that what are the specific areas that we are looking to fix and how much time in our opinion we think that this could take irrespective of the transition plan that
Krishna Bodanapu
As had said a number of these ideals or a number of these issues have been identified and we are working on them already. So I’ll say there are a couple of things, right? One is just in terms of the sales pipeline and order intake because I think that’s the first element of what we need to do is focus on getting our order intake up. Again, most of it to no secret in our business that the order intake converts to revenue. So we need to make sure that our order intake is up. So sales efficiency is one big piece that we’re working on very aggressively. And I think a lot of the sales team is now aligned to what needs to be done. And we are starting to see the results which is — what happens in Q3 is the first reflection of that and of course, that will only continue going-forward. The second element is on the — some of the cost and the efficiency elements, like also mentioned that we did this whole exercise last year and we got our margins up to 16%. Now some of that continued margins are worst premised on growth because again, as you know, in our business, there is always going to be cost increase pressures with salary increases, et-cetera. So to that we needed to have the growth, which once the growth will come, obviously, the margins also are under pressure. And therefore, we’ve also identified certain costs from a — both from an operating perspective and from a of course, the SG&A perspective that can be optimized. So all of these are already in-place because what will happen is we’re looking at a sort of a linear growth, not just the second-half growth for next year, which means that as some of these initiatives kick-in and growth comes back, we have a good margin trajectory. So the — I’ll say broadly the two categories that we’re focused on are sales and increasing order intake, again, various things including closure rates, capability, sales efficiency and on the other hand, on in terms of the operational costs and some of the operational costs that we need to address. The last thing that I’d also say is on forecast accuracy and forecast improvement, there’s a few things that we did, but one of the things that I’ve also come to realize is there is there is a part of our business which is hunt and execute, which is we don’t necessarily have the view even at the beginning of the quarter of how many speak of fiber that we will deliver in that quarter or how many repair sheets that we will deliver to an airline customer that quarter because that is a very operationally dependent thing. Those areas of forecasting, I think we’ve been unnecessarily very aggressive on. We will — again, this is not a huge part of our revenue, but this is the quarter-on-quarter 1% to 3% that makes a difference, which is really the difference that we are still struggling with. So we’ve also taken a view on how to forecast some of these things a lot more prudently rather than aggressively. And we believe that this is the other element that has really helped with the forecasting, please. Sorry for the long answer, but those are the few things that we’ve identified in the last couple of quarters. And I’ll also give credit to for some of these because I think a lot of these were done in the last six months or so, but we are now diligently executing towards these.
Sulabh Govila
No, no, thanks for — thanks for the comprehensive answer and thanks for taking my questions.
Prabhakar Atla
Just I’ll add one more thing to what Krishna just said. It is also as we spoke in various calls earlier, we made significant investments in technology-based solutions for the last several years. Many of them have been very effectively been in very good POC stages. The focus for FY ’26 also is to convert those investments into revenue and margin streams. Thank you.
Operator
Thank you. Next question comes from the line of Sandeep Shah with Equirus Securities. Please go-ahead.
Sandeep Shah
Yeah. Thanks for the second call., is it fair to assume by when we report the quarter results, which could be a full-year result and may result come at end of April or May, we could have identified the next candidate who will take-over as a CEO?
Krishna Bodanapu
Yes, absolutely. That’s my commitment. But before — certainly before the results, my commitment is actually by the end-of-the quarter. But certainly before we announce results, which will be the third week of April, we will have identified. Again, I just want to reiterate that we are looking at both internal and external options and the search agency is looking at both, but we will identify a new candidate who will be the CEO. And I will also say that I’m also committed to making sure that there’s enough room to operate because my objective is really to operate or to also focus on the other two businesses and therefore, there will be more than enough room for the new candidate to operate. So with all sort of due modestly, I want to say this is not something that I really would like to do on a long-term basis. So it’s as much in my best interest because I can really add value looking at an overall comprehensive technology picture for science rather than just the engineering business.
Sandeep Shah
Okay. Okay, okay. And in that process, you are saying at least till research is on, which may complete by end of Q4. So Mr Karpik will be there in the company as an employee or advisor.
Krishna Bodanapu
Yes, absolutely. Okay.
Sandeep Shah
Okay. Okay. And just a second question. You have also mentioned that you want to increase the sales efficiency to drive better growth and margin in FY ’26. So can you give us three, four concrete measures which you have taken in terms of improving sales efficiency, so we can actually compensate the seasonal factors, which generally affects the engineering R&D business also the completion. So in terms of review process, in terms of going aggressively large increase. What are the concrete measures you have taken now?,
Krishna Bodanapu
May I ask you, has been leading this initiative quite aggressively over the last few months, even six months ago, we started this. I’ll let Prabhakar answer that and then I’ll add to it.
Prabhakar Atla
Sandeep, thank you for the question. There has been quite some work that we’ve been doing on this front. As you know, we invested significantly in sales to drive the revenue growth for the company. And in FY ’25, we have not been able to monetize the investments we made in sales. So for the past several months, we’ve been working very diligently on this exercise. A number of things we are doing, but I’ll just call-out a couple of them. The first is the strength and the differentiation of the proposition that we take to the market by marrying the investments we made in technology and differentiating our offering with latest technologies that are coming out to disrupt engineering as a segment. The first is the proposition of clarity and differentiating it from what we were doing in the past and what we will do in the future. That was the first area that we were focusing on. The second area we were focusing on is to move from a relationship-based selling to a value-based selling because the crops we sell today, which are very technology intensive are different from what we used to sell-in the past based on relationships. So we’ve been focusing on training and tools to enable our current sales force to adapt more of competitive selling than we were doing in the past. The third is, we now set a very clear objective framework for tracking the sales efficiency at an individual level. There are expectations clearly laid out for the revenue, the margin or the OA that every role has to generate and a very clear performance evaluation framework that hinges more on rewarding incremental revenue growth, then continuing to maintain the current revenue streams even if they are growing. So at least there are 70 different items we are working on. I only call-out the top three, which is the proposition, clarity and differentiation by increasing technology into that. Second is approach towards consultative selling as against the traditional relationship-based selling. And third is a clear expectation setting and performance management framework, which more on rewarding performance for driving the revenue and margin growth than to continue the status core business.
Sandeep Shah
Okay. Just last follow-up. Yeah. Yeah.
Krishna Bodanapu
Please go-ahead.
Sandeep Shah
Yeah. Just a last follow-up. Are we also creating a large deal function separately within the company, which would be responsible to work across horizontal and verticals?
Prabhakar Atla
Yes. It create one because if you also look at it, we have built a very balanced yet diverse portfolio, right? And in each of these portfolios, our proposition also is relatively specific to the portfolio to the industry like for aerospace or for communications or for energy, what have you. But at the same time, to carve-out a large deal is also a structured exercise, we now have a large deal team working supporting the current sales leaders and sales managers to construct a deal from what we were doing previously, especially as we move towards the selling of technology in a consultative model, our team will now help the sales dealers and sales managers to carve-out larger deals from the current proportions we are currently taking to the customers. It’s also being done. That’s one of the seven things that I didn’t talk completely about. That’s one aspect. And the 13 large deals that we have signed in Q3 is also — probably it is a little bit early to take it as a trend, but it also is a good reflection of the focus that we were able to bring into that discipline and to carve-out larger deals and what we were doing before.
Sandeep Shah
So thanks.
Krishna Bodanapu
Just to — I’ll just add one thing that while we’ve always tried to push on how we are selling, sell more, sell relationships, sell. I think what we were missing is what we are selling also because the market really needs really a lot more technology-driven solutions. And I think our ability to articulate and really strengthen the technology team was something that we were missing because what we were selling wasn’t necessarily what the market always wanted. I mean, there’s a lot of what we — what traditionally sold that still works well, but we also had to change to Prabhaka’s point on how we sold to go from a relationship-based sale to a value-based sale, which is essentially what is the problem that we’re solving.
Sandeep Shah
Okay, thanks and all the best.
Krishna Bodanapu
Thank you.
Prabhakar Atla
Thank you, Sandeep.
Operator
Thank you. Next question comes from the line of with Kotak Mahindra AMC. Please go-ahead.
Sudheer Guntupalli
Hey, hi. Hi, Krishna and Parakar. Thanks and good. Firstly, Krishna, on your thoughts on the trade-off between an external and internal candidate, any external candidate may mean hitting the refresh button on-strategy, go-to-market growth and margin targets, both in the near-term and medium-term. So how are you thinking on the strategy and go-to-market?
Krishna Bodanapu
If are talking to candidates, I would look at who can also — yeah, I want to say it cannot be somebody who will continue to status quo because that’s not fair to the new candidate, even an internal or an external candidate. So when I’m talking to people and looking at who would really take the positive momentum that created, the positive trajectory, but really build-on it, what are the changes or what are the creeps they would make, not necessarily wholesale changes because a new person who comes in and makes wholesale changes will disrupt the organization, which might not be the right thing at least in the short-term because all said in mind, we’ve built back some very good momentum, things are looking quite good. So it’s really okay, how do we use this platform to sort of ride the wave before you try to do something very different or very dramatic. So the way I’m looking at it is things are going okay. Whoever comes in has to look at it as, okay, let me make the tweaks and continue this growth momentum. And then okay, over a period of time, of course, it’s up to that individual to decide how they want to run the business. So the LNR Committee and of course, me are very conscious about a good transition because I think we have some great people and again, Karthik has done a great job along with his leadership team, including is on the call here. So we need to write that momentum at least in the short-term because there is good momentum. I mean, we’re not in any position of weakness in the short-term. So it’s not that something has to dramatically change. And I would look at an individual who would look at it also from that perspective that there’s a good thing going, how do we make it grade rather than saying there’s a bad thing going and we have to now change everything. So it’s a balance and really my role in the new transition would be to just make sure that, that individual understands the balance so they can take their decisions after that.
Sudheer Guntupalli
Fair enough, Krishna. And we have a very strong cash balance sheet and we are a very strong cash-generating company. So any thoughts of, let’s say, in terms of capital allocation looking around a something sort of a buyback because the stock also seems to have corrected quite a bit and at least the market sentiment is that it’s available at very attractive valuations.
Krishna Bodanapu
So the Board will take that decision, obviously, because that’s a Board decision. But the Board is open to considering all the all the options on the table. Obviously, with buyback now there is another consideration on tax also with, I guess, buyback also being taxed at marginal rates, etc. So the Board is looking at all the options and we will keep you posted, but I just want to say the Board did talk about it and they’ve agreed to during the course of the quarter, they will look at the option and see if that’s a viable option for us.
Sudheer Guntupalli
Thanks, man. And just —
Krishna Bodanapu
I also — sorry, I’ll just say one thing that I also want to thank and the finance team for where we are on that with zero-debt in-spite of being very aggressive in terms of acquisitions, much of it is done with debt. We’re now to zero-debt with INR1,000 crores of INR2,000 plus crores of cash-in the bank. So that puts us in a very good position and I think it’s just a good time to acknowledge the finance team and work with them there. Sorry,, please.
Sudheer Guntupalli
Yeah. Thanks,. One last question to Prabhakar that we understand that our business is not as linear and predictable as IT services and forecasting anyways is the job of analysts and not that of company management. And then it’s a truth that 80% to 90% of the time even analysts get their forecast wrong. And probably we are one of the few midsized companies who still have this guidance phenomenon. My question is, what is your upside as a management team to give guidance, which is an extra data point which nobody is asking for and be accused of rather unfairly accused of misleading investors when we get the forecast wrong, like anybody can get the forecast wrong.
Prabhakar Atla
No, absolutely,. It’s a very relevant and very important point for the discussion as we stand here today. A couple of things, three things I’ll say. Firstly, as a result of conscious choice, the result of a lot of hard work from the entire organization, we have built a balanced portfolio of businesses in the last five years. So the intent of building a balanced portfolio was that we would like to have a sustainable existence and growth as a company over the next decades and not just for the quarter or for the year. So we have built a balanced portfolio. But having come this far, the second thing I’d say is that building a balanced portfolio is one part of the business. But if you look at our business today, it is fairly diversified into multiple segments and these segments having its own cycles, its own specific proposition and some businesses operate in a program-centric model like in aerospace and some business operate in a project-centric model, which for example, is energy and some businesses can also be safety and so now we have come to a point of diversification where the previous guidance frameworks that we were using to provide a view of how we see the following year are not applicable to how we can forecast the business for the following years. So to your point, you’re absolutely right, the previous guidance framework are not working for us, which is what we are very clearly seeing in FY ’25. We don’t ever want to be there once again. So we are working through what is the reframe or refreshed guidance framework that we can use for FY ’26 and that we will present to you all-in the earnings call we will have for FY ’25 in terms of how we look at FY ’26, what those parameters will be and what that framework of guidance will be. I can assure you it will not be the single framework we’ve used in the past because that doesn’t serve the nature of business that we’ve evolved into consciously over the last several years.
Sudheer Guntupalli
Thanks, Rabhakar. That’s it from my side. All the very best. Thank you.
Prabhakar Atla
Thank you very much, Sudesh. Thank you
Operator
Next question comes from the line of Pavik Mehta with JPMorgan. Please go-ahead.
Bhavik Mehta
Hi, thank you. Just one question. Obviously, given some soft targets or guidance for next year in terms of growth in linear over the four quarters as well as the margin expansion. But the risk over here is whenever the new person takes over as CEO in April or May, then wouldn’t he want to come up with his own strategy, which might have been derail some growth or margin momentum in the short-term and I mean you might have to go back on whatever the sort of targets you’re doing right now.
Krishna Bodanapu
Fair question, but I’ll say two things on it. One is I think this is the steady-state, right? I mean at the end-of-the day state continues in the sense that this is the base-case that I’m talking about. Whatever the new person does really needs to add to the base-case, not replace the base-case, so to speak. And I think there is enough — there is enough sort of spend in the system for us to repurpose like if there is a change in strategy from a certain type of technology to another type of technology. For example, there’s already enough technology spend that it’s really only a repurposing, so it won’t hit or it won’t hit margins. It’s only a repurposing of spend rather than coming up with new spend. Similarly, I’ll say that if you look at again within the revenue growth, that technology is still not a huge part, which means that even if the technology spend gets delayed by a quarter or two or because the new person wants a different strategy, the base-case growth will still be there. So I’m quite confident on the base-case. And really what I would look from the new person is really how to accelerate the base-case because if it’s only the base-case, then that doesn’t really serve our purpose of how do we really get back to the growth numbers that we would like to see. That’s one point I make. The second thing is, I think we also want to make sure that the transition is relatively, you know is a — at least in the initial days, the transition really has changed and only once the person understands the business it’s a step-change, which means that it can be managed in such a way that the base-case growth is there before we see any significant changes. So in that context, I’m quite confident that whoever the new person is, the base will remain quite solid because that’s built on some existing capabilities, what our existing customers are telling us — sorry, the order intake that you’ve seen, etc.
Bhavik Mehta
Okay, thank you.
Operator
Next question comes from the line of Mihir Manohal with Carneelian Asset Management. Please go-ahead.
Mihir Manohar
Hi, thanks for giving the opportunity and thanks for keeping the call again. Largely wanted to understand on the — I mean, an outlook that we are looking for FY ’26. I mean, when we had started FY ’25, at that point in time, we were expecting some deal wins to flow into — I mean deal wins to pipeline to flow into deal and then to flow into revenue and that was resulting into a high single-digit kind of a growth. What part of the confidence now is coming from this particular part of the framework for FY ’26? I just want to get a broader understanding around that. And second question was on the — I mean, the top three verticals that we are having. Even if you can give some color around the conversations that we are having with some of the top two customers in each of these verticals with respect to the budget spends that they are going to do with us for CY ’25 that will be really helpful. Thank you.
Krishna Bodanapu
Sir, do you want to give a quick answer? I think we have about two minutes before the market is open. So would you just give a quick answer then I’ll do a quick summary.
Prabhakar Atla
Okay. So Mihir, a lot more details on the second part you asked. Can I request that we have a separate conversation on the specifics. But very broadly on the first question that you said for us, at the end of Q1 FY ’25, we did have execution movements within the quarter in Q1 FY ’25. Therefore, we had a revenue in FY ’24 — Q1 of FY ’25, which led to the knock-on effect that we are currently seeing in the current year because we could not recover all of that in the current year. But that said, like I commented before, the three metrics that we talked about, the sales pipeline being the highest-ever, the order intake in Q3 being the highest-ever despite of having a shorter-duration runway as compared to the previous year’s order intake run-rate that we have had and the large deal momentum, combined with the fact that the risk profile of the execution ecosystem today is much different and much more healthier compared to what we’ve seen in — at the end of FY ’24 is what gives us the confidence that we’re looking at a stronger base to look at how FY ’26 will look like compared to how we were looking at FY ’25 then. But more details we can discuss in the conversation later today, Mihir if you are available. Krishna, with this, I’ll hand it over back to you.
Krishna Bodanapu
Thank you, Prabhakar. And I think considering the markets open in a few minutes, we should just do a quick wrap-up. I just want to say thank you very much to everybody for taking this time on a Monday morning. I certainly don’t want to be a Monday morning headache. I’m sorry if this call was a bit sudden, but I thought we should give you a bit of a color or a bit of an oversight of what happened and why certain decisions were taken and how they’ve come out. I just wanted to say from a people perspective, we’re in good shape. We have a good team. We’re working on it. We will, like I said, have a new CEO, internal or external by the end-of-the year — by the end-of-the quarter for sure. And I will keep you posted. Hopefully, it will be much before that, but I will keep you posted. The second thing is, I also wanted to just clarify position. He is available. He is still engaged with me on helping me think through and sort out the transition. So that is also going on quite well. And he’s been a thorough profession, especially when it comes to customers and some of the customer transitions. The third thing, as we talked about on the numbers, things look fine. We don’t really believe that we have a significant challenge. Yes, there are things that we need to do better. There are things that are still uncertain because of the nature of our business and because of the nature of how we work. But net-net, the business, I want to assure you is in a better shape than it’s ever been and we will make sure at least in the interim, I will make sure that things only get better. So the new CEO starts off from a point of strength and the base of strength and we can really build-on that strength for FY ’26 and beyond. In the interim, Q4 will be a growth quarter and we’re making sure much of that growth has been secured and we’re making sure I’m finding the decisions. So thank you very much again for your time on a Monday morning. I want to assure you, I don’t want to be a headache, I want to be a problem. I will make sure that we do a good transition and we are quite confident on where things stand and how things will evolve. With that, thank you very much.
Operator
Thank you. Thank you. On behalf of Science Limited, the that concludes this conference. Thank you for joining us. You may now disconnect your lines.
Krishna Bodanapu
Thank you very much