ECOS (India) Mobility & Hospitality Ltd (NSE: ECOSMOBLTY) Q3 2026 Earnings Call dated Feb. 11, 2026
Corporate Participants:
Rajesh Loomba — Chairman & Managing Director
Hem Kumar Upadhyay — – Chief Financial Officer
Analysts:
Unidentified Participant
Priyanka Bhagat — Analyst
Jainam Shah — Analyst
Jigar Jani — Analyst
Dixit Doshi — Analyst
Viraj Mithani — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Ecos Mobility and Hospitality Limited Q3FY26 earnings conference call. As a reminder, all participants line 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 this conference call, please signal an operator by pressing Star then on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Priyanka Bhagat from Ad Factors Investor Relation Team. Thank you. And over to you.
Priyanka Bhagat — Analyst
Good evening everyone. A warm welcome to all of you and thank you for joining us today for Ecos India Mobility and Hospitality Limited’s quarter three and nine month financial year 26 earnings conference call. We truly appreciate your time and continued interest in the company. We are pleased to have with us the senior management team led by our Chairman and Managing Director Mr. Rajesh Loomba who will share his perspective on the company’s performance for the quarter and the nine months ended financial year 26. He is joined by our Chief Financial Officer Mr. Hemopadiay who will take us through the financial highlights.
Before we begin, I would like to remind everyone that certain statements made during this call may be forward looking in nature. These statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. With that, I now hand over the call to Mr. Rajesh Lumba for his opening remarks. Over to you sir.
Rajesh Loomba — Chairman & Managing Director
Thank you Priyanka. Good evening and thank you for joining us today for Ecos India Mobility and Hospitality Limited’s Q3 and 9 month FY26 earnings conference call. So before we begin, I would like to extend our sincere gratitude to all the participants who have joined Earnings Call and a warm welcome to the ones who have joined us for the first time. And thank you for the investors who have shown continuous engagement and support to ecos. To begin with, a brief overview of the company. As many of you are aware, EKOS is a leading corporate managed mobility solutions provider with a Pan India presence.
We offer comprehensive B2B transportation services across two key segments. One is employee transportation services which we also call Etsy and the other is Chauffeur driven car rentals or CCR. We currently operate in over 131 cities across India and have a presence in more than 30 countries globally. Our clientele includes many Fortune 500 companies and BSE 500 companies, global capability centers, travel and event management companies along with fast growing Indian enterprises and SMEs as well as B2C customers availing our premium services. These clients rely on ACOs for scalable, safe and technology driven mobility solutions. Our strategic focus remains consistent.
It is to drive sustainable growth by onboarding new clients at the same time enhancing wallet share from existing relationships and clients and expanding our presence across new geographies both domestically and internationally. With that brief overview, now let me take you through the key highlights of Q3 FY26. As we have reiterated over the past two or three quarters, we continue to make strategic investments in to establish a durable and differentiated position as a technology driven, globally relevant mobility platform. These initiatives are delivering tangible operational benefits and are shaping the evolution of a fully digital ECOS with increasing adoption of our end to end CCR platform.
Currently, more than 21% of CCR bookings from our corporate clients are powered by Eco’s Cab Drive Pro APIs and customer app platforms. During the quarter we also launched a direct web booking portal marking an important milestone in the company’s ongoing digital transformation journey. This platform extends the same enterprise grade reliability and service standards that ECOS Mobility is known for among large corporates to individual users and small and medium enterprises, thereby broadening our reach beyond traditional corporate contacts. From a geographical perspective, our business remains well diversified across major tier 1 and tier 2 cities with Bangalore, Delhi, Gurugram, Mumbai and Hyderabad together contributing 60% of the company’s total revenue, further strengthening our presence.
Last month we inaugurated our new second office in Bengaluru, an important step in deepening our footprint in one of India’s most significant enterprise and technology hubs. This expansion aligns with Ecomobility’s broader growth strategy of scaling responsibly across key metropolitan markets while continuing to invest in people, tech and governance led mobility solutions. The new office enhances our ability to deliver reliable, efficient and future ready mobility services to enterprise clients in the region. This momentum was further reinforced with the onboarding of 39 new clients during the quarter, many of which are large enterprise clients. So typically if we talk about such clients, such clients involve higher startup and ramp up costs with margin expected to normalize over the next two to three quarters as operations scale up with these clients.
This takes our active client base to 1734, a growth of 34% compared to Q3 FY25. These additions reflect the industry wide shift towards organized and reliable mobility partners. Client retention remains strong with 55% of our first nine months revenue contributed by clients associated with ECOS for over five years. This underscores the strength and longevity of our client relationships. Our fleet capacity expanded to over 19,000 vehicles including 997 owned units. This enables a calibrated asset light approach ensuring capital efficiency while selectively deploying own fleets. Total trip volumes first nine months stood at 3.84 million out of which 1.3 million trips were undertaken in Q3 itself representing a healthy growth of 31.29% compared to Q3 FY25.
Now this reflects sustained enterprise demand and underscores our ability to scale rapidly and efficiently across high value mobility segments. Turning very briefly to our financial performance, Ekos delivered resilient revenue growth of 22.8% on consolidated basis year on year in Q3 FY26. This has been driven by strong performance across both employee transportation and shopper driven car rental segments. This growth was supported by higher trip volumes and an improved premium mix during the quarter in the CCR segment. Encouragingly, operating cash flows remained aligned with our EBITDA and working capital days stayed stable despite the higher scale of operations.
Now this reflects truly disciplined execution and a strong cash flow management. To conclude, we remain focused on strengthening our market position, garnering more market share in a very highly fragmented industry which we believe will drive sustained top line growth over the next medium to long term. While margins may remain moderated in the near term as we continue to invest in technology and digital solutions and our people including leadership, talent and offers. These investments are critical to building a scalable and resilient platform. While the current phase reflects calibrated investments to accelerate the scale of our business and the growth, we believe we are approaching an inflection point where operating leverage, the premium mix, expansion and efficiencies of scale will begin to reflect more meaningfully in the margins.
We are confident that this phase will mark an important milestone in eco’s growth journey. With that I will hand it over to our CFO Mr. Hema Padhya. Thank you. And over to you Hemu. Thank you sir.
Hem Kumar Upadhyay — – Chief Financial Officer
And good evening everyone. Now I will take through our financial performance for the quarter and nine month ending ended December 2025 and provide some contest around the key movements. During. During Q3FY26 we reported revenue of Rupees 2060.71 million which representing 22.48% year on year increase. This growth was driven by higher activity level across both the CCR and ETS segments supported by sustained enterprise demand and better utilization across the fleet. We continue to see healthy traction from our corporate clients which is encouraging for the medium terms. Our EBITDA fourth quarter stood at rupee 233.55 million reflecting a year on year growth of 8.05%.
Operating leverage from higher scale supported profitability. However margin were impacted by higher variable and vendor link cost associated with servicing incremental volume and onboarding large enterprises accounts. As a result, EBITDA margin for quarter was 11.33% compared to 12.85% in Q3FY25. This moderation reflect near term cost pressure linked to growth related investment and drive for higher market share. We have already initiated price adjustments, vendor rationalization and cost efficiency measure which I expect will support margin improvement as these actions flow through over the coming quarters. Profit after tax for Q3FY26 stood at rupees 139.43 million registering 9 registering a 9.2% year increase despite higher depreciation following fleet addition made to support the growth.
Turning to nine month performance revenue from operation for nine month FY26 stood at 6,013.98 million up by 26.15 year on year reflecting sustained momentum across both business segments and continued expansion of our operational footprint. EBITDA for nine month period was 697.76 million, a 5.85 year on year increase with EBITDA margin of 11.60% as compared to 13.83 last year. The margin movement over period reflect higher manpower deployment, fleet expansion and certain non recurring provisional provisions. Incurred profit after tax for nine months stood at 418.40 million, broadly stable compared to previous year. Overall. I am encouraged by strength of our growth and resilience of our operating model and the discipline with which we are investing for scale.
Our balance sheet remains healthy, demand visibility is strong and as operating leverage improve, I am confident in our ability to deliver sustainable growth with improving profitability. For that I will now open the floor for questions.
Rajesh Loomba — Chairman & Managing Director
Thank you very much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Jainam Shah from Aquarius Securities. Please go ahead.
Jainam Shah
Yeah, thanks for the opportunity. Congratulations for the strong top line growth. My first question is related to the top line for the fourth quarter, as we have guided for around 17 to 20% kind of growth for the full year, we are already at 26% kind of a growth in the nine months. How has been the momentum in the January month and overall 4Q how we are expecting?
Rajesh Loomba
Well thank you for the question Jenam and I guess it’s been going better than what we expected so far and we hope for the same trends to continue. But over the long term our guidance remains between 15 to 20% growth. At the same time we hope that we are able to exceed our own targets.
Jainam Shah
Got it. And if you can just give me the number in terms of how is how has been the contribution of the CCR and ETA segment for this particular quarter.
Rajesh Loomba
So if you look at CCR in this quarter, CCR grew by almost 30% and ETS grew by almost 24% in this quarter. And if you look at the total revenues, CCR revenue would stand at around 43% while ETS would be around 57% of the total.
Jainam Shah
Got it. Now coming to the margin part. So basically margin of course for last two quarters there has been some provisioning which has impacted our margin. But how about this particular quarter? Like what could be the reason which has impacted our gross margins and not the only the EBITDA margin because our gross margins tend to be in the 27 28% range. Now it has eventually reduced to 26 and 27% range. Any specific one offs or anything that you can call out for the same?
Rajesh Loomba
No, there’s not too many one off. It’s just some provisions have been taken on account of the new labor code of of maybe around 75 to 80 lakhs. Sorry. Okay. Okay, sorry. Around 15 lakhs. So there no, no. Very basically there are no very large one offs that have happened in this. Okay.
Jainam Shah
So of course we were guiding the. Margin range earlier between 13 to 15% and you already said that margin might remain moderated in the near term. Any specific range that you would like to call out or this is the new normal that we can take for for at least for 2 3/4.
Rajesh Loomba
Typically in the third quarter, even if you look at the previous quarters the margins are have been a little brisk because also you know our top line got affected because of large number of public holidays. The gap in north India which carried on so but there are no, there is no. And we also onboarded a lot of new enterprise clients and what happens with these enterprise clients is initially during scale up and the ramp up the costs Are typically much higher and it takes two or three quarters so for the, you know the, the margins to normalize.
Jainam Shah
Got it, got it. Answer what would be the capex number for the nine months?
Rajesh Loomba
FY26.26.
Hem Kumar Upadhyay
So it’s around 26 crore sir as of now.
Jainam Shah
Okay. And what would be the target portfolio and for the 27?
Hem Kumar Upadhyay
No, it should be for 20, 25, 26. It will be the full month will be around 32 crores not more than around 32 crores.
Jainam Shah
Got it, Got it. If you see sir, our overall fleet size, even the top line and everything, things have changed drastically over last two, three years. The only thing which is not changed is our absolute EBITDA and the bottom line. So just wanted to check from your part that this all investments that we are doing maybe let’s say the price X has not been that great over a bit of time. Is it the competitive intensity one of the core reason for the let’s say diluting of the margin or it is just more on the investment part that we are doing for the future revenues.
Rajesh Loomba
That is always been there sir. The competitive intensity always be there. But our main focus right now is on garnering more market share. And when we’re doing that it takes a while for the margins to actually stabilize. And that aggression in garnering market share is also being reflected in the above expected expectation growth in the top lines.
Jainam Shah
Got it, Got it.
Jainam Shah
Yeah. Hello. That’s it for myself. If I have anything, I’m joining you. Thank you so much.
operator
Thank you. The next question is from the line of Sinthil Kumar from Join Ray Capital Services Ltd. Please go ahead.
Unidentified Participant
Thank you for the opportunity. I’m audible.
Rajesh Loomba
Yes sir.
Unidentified Participant
Yeah. I have a few questions. First one could you please quantify the provision related to the labor code
Hem Kumar Upadhyay
. So for till this diamond we have taken the provision of 15 lakh rupees only. Still now 15 lakh rupees.
Unidentified Participant
Okay. For Q3. Okay. So will this provision continue? Yeah. Will this provision continue in the coming quarters as we increase in the number of owned fleets, number of employees, number of levels?
Hem Kumar Upadhyay
No, the continuity is just like a. We will take the actual valuation so that routine incremental as per the joining period increase that will only come but not any specific or any exceptional numbers will come after that. Oh, okay.
Unidentified Participant
Okay. See in this quarter the employee cost has increased from 14.84 crores to 22.87 crores which is about a 44 percentage. But we have only given a provision of 15 lakhs. Could you justify what Is the reason for that surge in employee cost?
Rajesh Loomba
No, no. The employee employee cost which period you are comparing that last nine month 25. Nine month 26, right?
Unidentified Participant
No, I am talking about Q3 FY26 against FQ3.
Hem Kumar Upadhyay
So these labor laws which we are talking about, the outsourced offers which we have for our own vehicles as far as the our own payroll employee are concerned, we are adequately providing those graduate team lean quest liability and as a routine.
Rajesh Loomba
And if you look at the costs increase in the HR cost is reflected in the fact that we have 258 odd more people on our roles in terms of executives. And also there’s the yearly increment that had happened. So if you look at the last three quarters, the HR costs have been stable across every quarter.
Unidentified Participant
And secondly, could you please clarify the reason for this 29% surge in depreciation during this quarter?
Rajesh Loomba
Depreciation? Sorry, your voice is not clear. Your voice is not clear.
Unidentified Participant
Just can you clarify the reason for the 29 percentage increase in depreciation this quarter? 7.38 against 5.71 crores.
Rajesh Loomba
That’s because we have added around 250 more cars in the first nine months which which are both for fleet increase and for replacement of old cars.
Unidentified Participant
Okay. Okay. That’s it from my side. Thank you sir. Thank you.
operator
Thank you. The next question is from the line of Jigar Jani from Nuama PCG Research. Please go ahead.
Jigar Jani
Yeah, hi. Thanks for taking my question and great set of numbers. On the growth side. My question is more on the margin. So if you look at the mix, it has changed more in favor of CCR this quarter and we have seen that movement over the last three quarters playing out. But if I look at CCR generally is a higher margin business from what I understand overall in terms of take rate. So what kind of. If you could point out on absolute terms what kind of investment have gone into acquiring these new clients that you are mentioning in the quarter because then we’ll be able to get a sense of what we should look at as an adjusted EBITDA margin if normal course of business would have been.
And also if. Sorry, one more. Yeah. And if you could guide. I think previous participants asked for margin guidance also you said next couple of quarters probably margin will remain subdued. But in the PPT in your commentary you mentioned that you are taking some price highs and some vendor consolidation measures also which might also help in terms of improving margin. So how does both of these play out? If you could just give us some kind of guidance. Both for fourth quarter as well as next year. That would be helpful, thanks.
Rajesh Loomba
Yeah, sure. So the increase in the, the top line of the business, especially with the new clients that have been added on or certain accounts that get renewed, it comes with in the short term margin pressure wherein it takes. Because our main focus at that point in time is to ramp up our supply and ensure that a continuity of service and as also the growth of the wallet share of the client takes a few months for all of that to stabilize and for us to you know, make that result in an increase in the margins of what we are paying from basis of what we are paying the vendors.
So if you look at it like, you know, there’s a 30% increase in, in CCR this quarter, there was a 40% plus increase in CCR the last quarter. So the way the revenues have been going up, we also have to make the rationalize vendors and there is always a lag between the revenues going on and rationalizing our vendor payments. So that’s always been the case historically also.
Jigar Jani
I understood, but from what I remember with our conversations in the past, we usually operate at 60% kind of utilization on our feet. So we actually have significant capacity that is free to cater to any ramp up in demand per se. So just to understand is it that you are incentivizing vendors to give supply to you and which is why the vendor payments are higher and the gross margins are lower. And I just wanted to figure out what kind of impact this would be. Maybe 50bps, 100bps ballpark figure would help because this would help us model what kind of improvement can we expect over the next couple of quarters or next year.
Rajesh Loomba
So the team is working on that same jiggle and it takes a few months for the margins actually to stabilize it. Of course there is competitive pressures also which are there in the market currently. If you look at the fleet utilization, yes, it may be around 60% but the rest of the 40% which we currently using for as a, as a fringe supply or as supply to be used in peak, when we aggregate that as a permanent supply within the system, it takes a little time for the same supply to stabilize in the system. And that time taken also after that is done, we start rationalizing the margins with our vendors.
Jigar Jani
Understood. And on the growth side, broadly you’re guiding for 15 to 20% as a structural model. But given that you are adding clients and the growth has been fairly strong and wallet share also will go up, would it be fair to assume that it will be near the upper end of the band sometime in FY27. I know probably from a medium term it will normalize to mid range or lower end. But at least for the near term, can we expect this momentum to sustain?
Rajesh Loomba
I think we have a pretty good funnel and a pipeline, you know. And of course all this will depend on how well the sales organization is able to close out the contracts and get the new business in. But between 15 to 20% we are fairly confident.
Jigar Jani
Understood. And just lastly on data keeping wise, how much would be the cash and investments on our books now?
Hem Kumar Upadhyay
So currently we have 120 crore plus in as a cascade equivalent in our books.
Jigar Jani
Okay. And sir, lastly just to confirm there is a AI summit that is happening in Delhi. Are we associated with that event in any shape or form?
Hem Kumar Upadhyay
Please come again. Actually your voice is not clear.
Jigar Jani
Yeah, I was asking that there is a AI summit that is likely to happen in Delhi. It’s a big event. Are we a vendor for that?
Rajesh Loomba
AI, AI. Vendors of many, many such events, you know. And yeah. So all I can say is business is good. Yeah.
Jigar Jani
Okay. Thank you so much for your answer.
Rajesh Loomba
Thank you.
operator
Thank you. The next question is from the line of Dixit Doshi from Whitestone Financial Advisors. Please go ahead.
Dixit Doshi
Yeah, thanks for the opportunity. So first question is on the margins only. So obviously we were guiding at 13 to 14% but we have fallen to 11.3% this quarter. So one of the reason I notice is because of the jump in the, you know, the employee cost for nine months the employee cost has gone up by 36%. So from last three quarters the run rate is maintained at around 20 to 21 crore. So going forward in the next year, considering whatever hiring you are doing, will the growth in the employee cost will be higher than the revenue growth or it will be lower than the revenue growth?
Rajesh Loomba
I think it should be in line with the revenue growth. And to answer your first question, you know, statement of the margin, if you look at the F9 numbers excluding the non recurring provisions that we have taken place, you will see that the underlying EBITDA trend remains stable also.
Dixit Doshi
Okay. Okay. But this quarter it is almost like, you know, because if we see Q3 to Q2 also even if I remove the 5 crore which we have taken the provision in the Q2, the EBITDA is almost absolute terms is flat. So I think.
Rajesh Loomba
Yes, yes. So the total non decrement would be around 8 crores. Because taken in Q1 also some part of that was taken in Q1 and some part was taken in Q2.
Dixit Doshi
No, what I am saying is that in Q2 we have taken the 5 crore provision, right? In Q3, that provision is no more there. Despite that, our EBITDA is in absolute term is flat for this quarter.
Rajesh Loomba
Yes, yes, yes.
Dixit Doshi
Yeah. So one of the reason is the gross margin pressure. So if you can elaborate how the competition is there and is there a possibility to improve the gross margin in near term?
Rajesh Loomba
See, competition is there, but that is also the opportunity because the competition is so fragmented. And that the opportunity is what we are, you know, working hard to encash on to consolidate this fragmented business into a professional and organized market wherein we also feel that our clients are now much more open to that. Seeing our success at delivering this in so many clients in the recent past, and which is where we are concentrating to make sure that we are able to increase our market share at the fastest.
Dixit Doshi
Okay, and one more question was on the ETS business side. So recently Uber has announced the entry into the ETS market. So what are your thoughts in terms of competition? Because these guys have the, you know, big pockets and a bit of making losses in the initial years to scale up the business. So how do you see their entry into the etf?
Rajesh Loomba
So we welcome all, you know, competition, especially in the organized segment because the unorganized market is so huge that the more number of players who are, you know, I think their credibility to convert the unorganized to organized only helps the organized part of the market because more clients would be more open to dealing with organized players instead of the unorganized players. So we wish all our competitors well. And definitely a growing unorganized to organized market would invite more number of players. And there should be, why not?
Dixit Doshi
But do you foresee any pricing pressure because of this? Because in terms of gross margin.
Rajesh Loomba
Prices move in a band only prices move in a band within the industry. I am not, I will not be able to comment on what their strategy will be into this, but typically what we’ve seen is prices are already very competitive and they move in a certain band, especially in the employee transportation business. So we don’t, we don’t foresee any kind of, you know, bleeding kind of competition coming in over here. Because for a client, more important than just the price is also the credibility, the ability to deliver operationally to ability to deliver predictably with the same standard of service, you know, 365 days a year.
So they have a different expectation than a typical B2C market.
Dixit Doshi
Okay. And last thing, so this quarter, obviously there was drop in the margin to almost 11.5% for FY27. Do you feel that we can come back to that 13% or you feel that it may take longer?
Rajesh Loomba
No, I think in the long term, mid to long term, our guidance remains the same of between 30 to 15% and we should be able to recover our margins over the next few quarters.
Dixit Doshi
Okay, so you don’t expect further reduction in I think in the margins gradually it should improve only.
Rajesh Loomba
No. So I think there’s an inflection point, you know, wherein all the efficiencies of scale of the operating leverages, all that starts to cave.
Dixit Doshi
Okay. Okay.
operator
Thank you. The next question is from the line of Hardik from hssamc. Please go ahead.
Unidentified Participant
Hello. Thank you for the opportunity. I just had a few couple of questions. First of all, I’m just a bit new to the coverage of the company and I just wanted to understand the margin profile difference between the shoffer driven side of things and the etf. So typically ETS has a lesser margin profile as compared to shoffer driven. But what we are able to finally present is that kind of blended margin which you see on our financials. Right. And Rajesh, you had mentioned that Ecos Mobility has exposure to 30 plus countries. So I just wanted to understand is there any currency exposure to it as well or the contracts are hedged in the forex domain? It’s very, very minimal.
There’s because our business that happens internationally is way less so there is no currency risk per se. Typically we also get paid in advance for such bookings which we execute internationally. All right, and just one last bit, I just wanted to understand Eco’s approach towards the current GCC boom happening in India. Are we there bound to capture that side of industry as well? Yes, a very large number of new clients that are getting acquired are GCC clients. And definitely this is an inherent need in every GCC that scales up, you know, let’s say over 500 odd employees, that they need a secure, safe and compliant transportation service to ensure that 365 days a year the employees can have a good experience of commute from home to office and back to home.
Okay, fair enough. And so just two more questions. So one, was Ecos banking on changing the industry from like a fragmented landscape to a more organized sector? So I just wanted to understand before we onboard a client, do we have a screening criteria that an entity should have X number of employees or is it just open to all?
Hem Kumar Upadhyay
No, of course.
Rajesh Loomba
Our clients, if you look at the quality of our revenues, I think they’re the best in Any industry that you can find. Most of the clients are either multinationals or they are large or mid size Indian corporates or you know, or wealthy individuals as part of the B2C because we offer only a premium service to them. So that’s. And that also then gets reflected in our, you know, bad debts, which is negligible and our DSO which is very, very, you know, stable over the past so many years. Right, thank you. And Rajiv, one last question for.
Since we are sitting on healthy cash in the bank, are we looking at any inorganic growth opportun in terms of M and A? Yes, we are constantly looking at the opportunities. Unfortunately we have not been able to put our finger on something right now till now. Okay. All right, thank you for answering my questions and all the best for the future, sir. Thank you.
operator
Thank you. The next question is from the line of Siddhi from Aditya Birlamani. Please go ahead.
Unidentified Participant
Hi, am I audible?
Rajesh Loomba
Yes, please.
Unidentified Participant
My first question is what specific operational capabilities does E pass have currently that a well funded tech platform like rosematic or MoveSync cannot replicate in two to three years?
Rajesh Loomba
I’m sorry, what? Can you just repeat to the first part of the question?
Unidentified Participant
Yeah, I want to ask that. What specific operational capabilities does Ecosys have currently that a well funded tech platform like Rootmatic or Moving Sync cannot replicate in two to three years?
Rajesh Loomba
So operational capabilities are made up of, you know, an ingrained knowledge and culture developed over the years. It has to translate into service delivery at the last mile. Every rental out of the millions of rentals that we do, it comes from, you know, the capability of our people. It comes from the rigor and resilience of our processes and our deep knowledge of the business as a whole. And competition has been theirs, both tech and non tech has been there for many, many years. And in spite of that, Eco is the leader and I think that says it all.
Unidentified Participant
Yeah, surely. And under what situation do you prefer owning vehicle instead of outsourcing? Like over the long term?
Rajesh Loomba
Do you see? Can you repeat. Your voice is actually breaking. Can you just repeat the question again?
Unidentified Participant
Yeah, yeah. Under what situation do you prefer owning vehicles instead of outsourcing? And over the long term, do you see own fleet staying under 10% of total or rising material?
Rajesh Loomba
So yeah, we will. Our philosophy and model is asset light and we intend to keep it that way only. And there are a lot of strategic considerations that go into before we decide where we have to selectively put in our own fleet.
Unidentified Participant
Yeah, yeah. And when do you say large corporate are Consolidating vendors. What are the key decision drivers for them? Price compliance, tech integration or execution? Reliability.
Rajesh Loomba
So I guess the value that the, that the partner brings in is a combination of a lot of factors and the. You mentioned tech. And you mentioned tech. Another question also tech is an enabler, right? And tech does not mean that you would be able to deliver operations because. And tech is also a tool of audit for these clients. You know, so many clients also consider that the tech and the operations should not be with one company because it leads to a conflict of interest. Right. So typically all our clients, most of our clients have tech.
As we study the client and then we recommend which, you know, this client’s requirements, which is the best tech that suits that particular client as per the needs.
Unidentified Participant
Yeah, okay. Okay, that’s from my side.
operator
Thank you. Ladies and gentlemen. In order to ensure that the management is able to address questions from all the participants in the conference, please limit your questions to two per participant. The next question is from the line of Swetcha Jain from answer. Please go ahead.
Unidentified Participant
Hi sir, thanks for giving this opportunity. Sir, I’ve been hearing, you know, previous participants questions on margins and I’ve also been hearing your answer on margin. So I still want some clarification on the margin because I’ve heard you saying that margins will remain under pressure but I’ve also heard you saying guiding that margins will come back to 13 to 15%. And there is an inflection point. But all I wanted to understand was if our strategy is to acquire bigger clients and as you have stated that whenever you acquire bigger clients there is a hit that you have to take on the cost on the margins and then there is a, you know, vendor rationalization and you know, you have to bear certain costs which impacts your gross margins or your EBITDA margins.
So if that is what we are going to do, even going ahead, I really want to understand, you know, how do we expect these margins to go back and you know, in terms of inflection point, if you know what is our inflection point either in terms of revenue, in terms of number of big clients that we want to achieve. So what do we as management think that our company is at that inflection point? So that is my first question and once you answer this, I’ll ask my second question, sir.
Rajesh Loomba
So we feel as a company that inflection point wherein the true operating leverages kick in would be anywhere between 1000 to 1200 crore top line revenue and there would be, it would also translate into a certain number of trips and revenues at the city level as per whatever modeling that we have done. Also yes, it’s right. When we take on new clients it does result in a high cost, you know, for that client for a few months till the operation stabilizes.
Unidentified Participant
This phenomena will repeat every quarter. Right. So then the margins will be impacted every quarter.
Rajesh Loomba
But we are also seeing a higher premiumization in our CCR segment which should, you know, offset the blended margin. And end of the day, if you want to, you know what we see. And with the over the last few quarters we’ve seen the growth, the unbridled growth of the GCCs in India and even the growth within our existing clients. We feel it is right time right now to go all out and capture market share.
Unidentified Participant
Okay.
Rajesh Loomba
Because usually the lifetime value of these contracts for us is very high and definitely the margins can be rationalized over time.
Unidentified Participant
And so my second question was sir, with regards to our write offs that we had in the past just wanted to understand is there any more write off that we are expecting or whatever we had to done. We had to do. We are done with the write offs.
Rajesh Loomba
Yeah, that’s done in the second quarter. We don’t expect any new write offs.
Unidentified Participant
Okay. Thank you sir, really appreciate this.
Rajesh Loomba
Thanks.
operator
Thank you. The next question is from the line of Harsh from NV Alpha. Please go ahead.
Unidentified Participant
Thank you for the opportunity. All of our questions are by the previous participants. Thank you.
operator
Thank you. The next question is from the line of Mohammed Sufyan Lakrawala from the Nehru Cap Serve. Please go ahead.
Unidentified Participant
Hi sir, this is Divya Shmeta here. I had one simple question for our business. So sir, when we see a service offerings as on date we we do the catering to gccs, its manufacturing, everyone in terms of industry. Can you, can you help me to understand what is the kind of a revenue breakup from all this industry?
Rajesh Loomba
I didn’t have, I don’t have that. Sorry. No.
Unidentified Participant
Why is this question? Because the acquisition cost for all these new clients was quite high and which is being reflected into the GP margins also in the last quarter numbers. So I just wanted to understand that when we talk about the higher acquisition cost. So if this clients are mainly GPCs then this will be surely adding to our revenue for next six, seven years. So yeah. So if that proportion in terms of sales is higher then this gives us an additional advantage in terms of visibility of revenue.
Rajesh Loomba
So all our contracts are long term contracts only. Yeah, that’s for sure. And as we have seen, you know, and the stickiness of our Client Even beyond the initial contract period of three to four years.
Unidentified Participant
Yeah.
Rajesh Loomba
Wherein most of the clients find our services satisfactory enough to keep renewing our contracts. So it stretches much more than that.
Unidentified Participant
Okay. Okay. And so the second thing is like when we see our operationally cash flow of a company our profits, operational cash flows are always higher in terms of numbers compared to our net profit what we post. So my question over here was like on the depreciation so like this year you have already given the number in terms of capex also that you have spent around 26 crore capex for nine months and another 4 crore is expected in the last quarter of the financial year. So we have already bought around 250 new cars. But what is the depreciation cycle which we take over here and how do we see a life of a vehicle which is there with us?
Rajesh Loomba
So we typically look at a five year life cycle for these cars. At the end of five years we look at the car’s condition once again. If they are fit then we can drive them for another one, two or three years. If not then they are sold off.
Unidentified Participant
Okay so why I asked you this question is like the depreciation is a. Is a real depreciation in our businesses this is considered kind of a free cash flow for the company where you add the depreciation to the pad and then people see that this is a genuine cash flow coming into the company. So in our business the life of the vehicle is very important to get understood by the investors who have a visibility barrier etc for at least six to seven years.
Rajesh Loomba
I’m sorry I didn’t get the last part of your question.
Unidentified Participant
I’m saying in our business it is very important that at what case our asset is getting depreciated like our cars. Yeah. If you have a visibility like six, seven years we are talking about. So this capex cycle will be on the consistent basis every year but at the same time the, the there will be never a big capex which will be coming at any part of the business cycle.
Rajesh Loomba
No. Yeah. Correct. Yeah. So that’s what I wanted to understand.
Unidentified Participant
Anyway so thank you.
Rajesh Loomba
Thanks a lot sir.
Hem Kumar Upadhyay
Thank you so much.
operator
Thank you. The next question is from the line of Viraj Mithani from Jupiter Financial. Please go ahead.
Viraj Mithani
Thank you for the opportunity sir. Am I, am I audible?
Rajesh Loomba
Yes sir. Yes.
Viraj Mithani
Yeah. So my first question is regarding clarification. We talk about 15 to 20% growth so that would be the same the past margin of 10 to 12 we maintained or be which lower.
Rajesh Loomba
Can you just repeat the first part of the question, you said we grow.
Dixit Doshi
At 15 to 20 range. So going forward the pat margins will be maintained in range of 10 to 12% which has been there traditionally or. Will be going lower than that.
Hem Kumar Upadhyay
No, so a pat guidance has always been between 8 and a half to 10 odd percent, not 10 to 12%. And in terms of EBITDA, we are looking at anywhere between 13 to 15% in, in the mid to long term.
Viraj Mithani
Okay, and can you give a bit more color on gcc? Like how many customers do you have and what kind of growth rate do we expect there? I’m sorry, repeat, can you give more color on gcc?
Rajesh Loomba
There’s some background noise coming in.
Viraj Mithani
Is it clear now?
Rajesh Loomba
No, can you just speak again?
Hem Kumar Upadhyay
Yeah, now it’s clear.
Rajesh Loomba
No, maybe from somebody else’s phone. Something’s coming in.
operator
Anyway, there’s some disturbance in your line.
Viraj Mithani
Okay, just, just a sec, hold on.
Rajesh Loomba
Yes, okay, can just go ahead, I’ll try it here.
Viraj Mithani
Yeah, I just want more color on gcc. I mean how many customers we acquired and what do we see?
Rajesh Loomba
So last quarter we acquired around 39 new customers which brings the total customers acquired in first nine months to around 160 odd customers. The growth that we have been able to deliver in the last first nine months has been around 26 odd percent as compared to the last S9.
Viraj Mithani
I want to say the story of Global Community center gcc.
Rajesh Loomba
So what do you know gccs?
Viraj Mithani
I’m sorry, how many customers do you have in GCC and what growth rate we see in the second?
Rajesh Loomba
How many customers do we have in gcc? I think we’ll give that information to Priyanka and she can provide it to you. Post the call. I don’t have any handy exactly with me right now.
Viraj Mithani
Okay. And what rotate do we expect in this sector?
Rajesh Loomba
In this segment in gcc. Yes.
Rajesh Loomba
So I. We do not look at it that.
Viraj Mithani
Way that all the growth, you know.
Rajesh Loomba
How much would come from GCC or we’re looking at our marketing and growth on a holistic basis wherein we have a certain profile of customers that we target and aspire to acquire and we then strategize and execute as per that. So typically yes, CPCs are more right now because of, you know, so many new GCs are opening up in India. But beyond that also there are, you know, other multinationals, manufacturing companies, consultancies, large Indian companies, R D centers, etc. So many are there which who we are constantly targeting and acquiring the international business.
Viraj Mithani
We do. How does it work? We try with some operator outside or.
Rajesh Loomba
Yeah. Internationally. We have tie ups with our vendors overseas.
Viraj Mithani
Yes. Okay. Thank you and all the best.
Rajesh Loomba
Thank you.
operator
Thank you. The next question is from the line of Simone Sangvi from Prospero Tree. Please go ahead. Simone. You can go ahead.
Unidentified Participant
Hello. Am I audible? Hello. Yes. Yes. Thanks. Thanks. Recently government has launched the Bharat Taxi. So is there any threat to our business because of the Bharat Taxi business?
Rajesh Loomba
No, no. That is a ride hailing and ride hailing has been around for more than you know, 13, 14 years. We don’t see that as a threat. Our business model is different where we are a B2B mobility solutions provider to corporates and SMEs across India.
Unidentified Participant
Yes. So because of the different of business model you don’t think there will be any credit to the eco, is it correct?
Rajesh Loomba
No, no. Beyond you know us, of course there is some rarity that we both give a car and a driver. But beyond that there is so much more that our customers demand which we are. That’s where our business has been modeled.
Unidentified Participant
On because they are. They are adopting the cooperative model and the profit will go to the driver or something like that. We have read in the press. So more and more number will be the car owner related to their Barrett taxi. Is there a. Because we are thinking that we might have a lesser number of the driver or the taxi attached to our business. Will it impact our business? That’s why I’m repeating my question.
Rajesh Loomba
So we have been through various phases in which, you know, over the last 15 years wherein ride hailing companies also were giving incentives and all that was happening. But we have still managed to retain all our supply and in fact grown even better than before. What happens is when new ride hailing services or new competent comes in or a new concept comes in, it also helps in expanding the size of the market which at the end of the day benefits all the stakeholders in that market.
Unidentified Participant
Answer. In quarter one and quarter two the company has making some provision for the doubtful debt around 1.97 crore in the quarter one and 5.94 crore for the quarter two. And in quarter three there may be. Is there any problem in the quarter three or there will be no provision. There is a no provision.
Rajesh Loomba
No, no.
Rajesh Loomba
We. We don’t have any more doubtful dates and that also we are going to try and get the money back.
Unidentified Participant
So that’s okay. That’s fine. But. So why is lower than the quarter two in spite of the. There is a no Provision. It’s a 5.94 crore it is around 6 crore rupees of the provision made in the quarter two. So naturally our profit might must have grown.
Rajesh Loomba
If you look at this quarter historically also the last year also if you look at it it’s always been a little more subdued in terms of the margins and like I had explained on the call to another question we There are the. There’s certain costs in terms of our when the costs and the costs which went up go up in the quarter when we are. Especially when we are acquiring new large clients. So the initial costs of ramping up and servicing those clients are on the higher side which stabilize over a period of time. So we hope to see that stabilize over the next few quarters.
Unidentified Participant
That cost was a one time cost in the quarter three and it will be some more cost will be accounted in the quarter 4.
Rajesh Loomba
Also it depends on the on specifics of how we have to scale up and how fast we have to scale up in certain contracts. So sometimes it may be there but it’s. We don’t feel that it will be a regular occurrence and we are making certain strategies around it how we can avoid that.
Unidentified Participant
Last question. There is a for the nine month there was a revenue growth in this quarter also there was a revenue growth on a bioi basis. But in profit terms suppose we come back that the PBT is around 57 crore rupees in the last FY25 as well as in the current year. Also the PBT level is 57 crore rupees. The revenue has grown from the 476 crore to 601 crore rupees. So there is a naturally some operating leverage must be generated or some more margin. Even the at the same margin level the absolute number must have increased.
It’s a 57 crore. So what are the key reason for not growing in the no growth in the pvd.
Rajesh Loomba
So if you look at the numbers, if you exclude the non recurring expenses or the provisions that we have taken you will find that EBITDA is more of around the 13% range rather than the 11% range.
Unidentified Participant
I’m talking about the PBT number because ultimately it is the. The. The shareholder will gain from the PET number and The PBT is 57 crore rupees. Our revenue increased by around the same 22 to 23% in the first nine months of the current year. But profit number the PVT remains the same 57 crore rupees. So is there any. Can we exclude the 8cr rupees of the provision which you have made in the quarter one and quarter two and we add that it comes with the 64 crore rupees. Around 65 crore rupees. So in this quarter there is a no provision.
Then also the profit has not grown. So when we see the the profit growth along with the revenue growth on the. It’s a. Because the any increase in the revenue must result into the profit growth. It is not happening to our company.
Hem Kumar Upadhyay
So as said this is that that there is some operating cost things which is a little load on the higher side. If you Talk about the 9 month comparison for both the period 2526 so our pvt was 11.7% in FY25 and considering that one time impact of the bad debts which were 9.32% if we remove that impact so they’d be around the same label the PBT which we have in FY25. Right. And during this period also the employee cost like we added around more than 250 employees to increase the strength and the visibility of the company to provide the better services. So that is also the factor and going forward this employee cost will turn out into revenue and that overall margin should be to improve in that way.
Unidentified Participant
So can we expect that the now onwards.
operator
Sorry to interrupt you sir. Sorry to interrupt you sir. Can you please rejoin the question question queue? Thank you. The next question is from the line of Janam Shah from Aquarius Securities. Please go ahead.
Jainam Shah
Yeah, thanks for the opportunity again. So my question is related to the provision that we created over last two quarters. What the status was like are we going to receive the money in the near term or it is going to take time like what’s the current citizen when we are expecting the money to come in RPNL eventually.
Rajesh Loomba
So we are taking the legal action for recovery of that money. So we think that should take a year to 18 months for the process to be concluded.
Jainam Shah
Got it sir. And the client for which we would have provided for the provision. This is the client which is also contributing the revenue as of now or it is all done and tested with that client.
Rajesh Loomba
No. So it’s a very highly credible client. There’s seems to be an internal process issue for them and we hope to recover this money and it is an existing client.
Jainam Shah
We are receiving the money from them.
Rajesh Loomba
Yes, yes. For all other things we are receiving the money.
Jainam Shah
Thank you so much.
operator
Thank you. Ladies and gentlemen, you are requested to restrict your question to one per participant. The next question is from the line of Vedic Bafna from Monast Net Worth Capital. Please go ahead.
Unidentified Participant
Good evening sir. Congratulations on the good top line growth. I joined the call late. I just wanted to understand what would be our mix between the CCR and the ETS division in terms of revenue.
Rajesh Loomba
43 and 57. 43 this year.
operator
Thank you. Ladies and gentlemen. Due to time constraint. That was the last question. I would now like to hand the conference over to Mr. Rajesh Lomba for closing comments. Over to you, sir.
Rajesh Loomba
Thank you. Thank you to all our investors, analysts, partners and all stakeholders for their continued trust and support. It matters a lot. Your confidence in Ecos motivates us to remain disciplined in execution and committed to creating a long term sustainable value for the company. Thank you very much.
operator
Thank you. On behalf of Echos Mobility and Hospitality Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.