Intellect Design Arena Ltd (INTELLECT) Q4 FY23 Earnings Concall Transcript

Intellect Design Arena Ltd (NSE:INTELLECT) Q4 FY23 Earnings Concall dated May. 12, 2023.

Corporate Participants:

Arun Jain — Chairman & Managing Director

Praveen Malik — Vice President, Investor Relations

Banesh Prabhu — Chief Executive Officer, Intellect AI

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

Analysts:

Mohit Jain — Anand Rathi Securities — Analyst

Anil Sarin — Centrum — Analyst

Sugandhi Sud — InCred Asset Management — Analyst

Majid Khan — CapitalX — Analyst

Rahul Jain — Dolat Capital — Analyst

Chirag — Ashika Group — Analyst

Ravi Mehta — Deep Financial — Analyst

Harshil Shethia — AUM Advisors — Analyst

Vivek Kumar — — Analyst

Jagdish — — Analyst

Darshil Jhaveri — Crown Capital — Analyst

Presentation:

Operator

To discuss the Intellect Design Arena Limited Financial Results for the Fourth Quarter of the Fiscal Year 2022-23, and the full year ending 31 March, 2023. The investor presentation and press release has been sent to all of you and is also available on our website and as well as stock exchange website.

Our leadership team is present on this call to discuss the results. We have with us today, Mr. Arun Jain, Chairman and Managing Director; Mr. Manish Maakan, CEO of IGTB; Mr. Rajesh Saxena, CEO of IGCV. Mr. Banesh Prabhu, CEO of Intellect AI; and Mr. Venkat Saranu, CFO. Beside some other very senior members of the Intellect management team are present in the call.

Mr. Arun Jain will brief you on the results, followed by the briefing of Mr. Banesh Prabhu, Mr. Rajesh Saxena and Mr. Manish Maakan. Thereafter, there will be a Q&A session where your questions will be replied by the senior management team. [Operating Instructions]

On Safe Harbor, I would like to remind you that anything which we say in reference to our outlook for the future is a forward-looking statements. This must be viewed in conjunction with the risk company faces.

With this I request Arun to give a briefing. Arun?

Arun Jain — Chairman & Managing Director

Good evening to everybody who has joined this conference call. Today we are celebrating the annual results of Intellect for ’22-’23. This is a culmination of last nine years of our effort when we demerged Intellect Design Arena from Polaris Software. During just nine years we built-up this institution of high quality product development, deep reach in market development, and cutting-edge technology development, which got translated to put the company on the global map for BankTech Wave 5.

We have mentioned in the release, two words which may be new to the investor. One is called eMACH.ai and second is BankTech Wave 5. I would like to explain the two, these are very — [Technical Issues].

Praveen Malik — Vice President, Investor Relations

I think we have probably lost Arun.

Operator

Sir, we are bringing him back.

Praveen Malik — Vice President, Investor Relations

We have a small glitch. We are starting again. Small technical difficulty. Yes, Arun. You can go ahead.

Arun Jain — Chairman & Managing Director

You can hear it. Remove that —

Banesh Prabhu — Chief Executive Officer, Intellect AI

Yeah, yeah, we can hear it.

Praveen Malik — Vice President, Investor Relations

Still frozen.

Arun Jain — Chairman & Managing Director

Screen is still frozen. Okay. Is it visible now?

Praveen Malik — Vice President, Investor Relations

Screen is still frozen.

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Visible but frozen.

Praveen Malik — Vice President, Investor Relations

Yeah.

Banesh Prabhu — Chief Executive Officer, Intellect AI

Screen is frozen sir.

Praveen Malik — Vice President, Investor Relations

Yeah, no problem. Go ahead.

Arun Jain — Chairman & Managing Director

Okay. So I start from the beginning, Parveen?

Praveen Malik — Vice President, Investor Relations

No, it’s fine.

Arun Jain — Chairman & Managing Director

When did you lose us?

Praveen Malik — Vice President, Investor Relations

Arun you were talking about eMACH.ai–

Arun Jain — Chairman & Managing Director

Two new things. Yeah, so let me start from a positioning of the company at the right place about nine years of our efforts have brought in what we are today. So BankTech Wave 5 started sometime in 1965, which was mainframe-based technologies, banks start choosing for their registers. Sometime in 1985, the mini computer came in, and the second wave started on using that computerization in the banking, but in the back end for calculations and somewhat front-end applications, trans applications started happening.

BankTech Wave 3 happened sometime in the mini — when the distributed computing started happening sometime in the 90s. We have many product companies emerge, whether Temenos or FLEXCUBE or the players in a similar domain, Temenos emerged in ’90s to ’95 era. This was a distributed computing company started happening. Some time in 90 — 2000, 2001 an Internet technology disrupted the industry and there next-generation of customer experience, started to take some shape in BankTech Wave 5.

Now in BankTech Wave — in parallel BankTech Wave 4 and BankTech Wave 5 is about when cloud disruption and AI disruption happened. So it means whenever the technology disruption happens, there is a significant wave that companies have to realign themselves to the new horizon. And that investment has to be done at least three to four years in advance. And we could able to pick-up the right signal, early enough that cloud and AI is going to disrupt the technology industry which you are — all of you are seeing in last six months more dominantly versus when we picked-up in 2017 and invested a team of cloud technology in New York, and then AI technology in India and New York, we invested the money over there.

With these investments we made on Fabric platform, and second is the MACH Composable Platform, Turmeric, which was a technology platform which we invested into it.

Banesh Prabhu — Chief Executive Officer, Intellect AI

Loose him again.

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Yeah. We seem to have lost him again.

Praveen Malik — Vice President, Investor Relations

Yeah, yeah, working. Another couple of seconds.

Arun Jain — Chairman & Managing Director

Hello yeah. I’m back.

Praveen Malik — Vice President, Investor Relations

Good.

Arun Jain — Chairman & Managing Director

Yeah, so about that eMACH.ai is creating waves in the marketplace. We are bringing all the products which we have built over the period of time, in retail banking, in corporate banking in wealth arena and the micro-services. So there are 285 micro-services, which can be assembled to design the product related to particular market, let’s say where HSBC Bank has to design an offering in a specific country or specific SME segment, they would like to offer certain feature and functionality which they used to use services company to build those products. Today, we are able to disrupt that pattern saying you can do it using Composable Platform from Turmeric where there’ll be almost zero code and it will be Composable Platform.

So we define A to F of email.ai which revolves around architecture, [Phonetic] it revolves around microservices, it revolves around compability, it is all around data. It revolves around embedded AI. And it is flexible and extensible for the bank. And that’s what giving us good momentum with the customers globally. So this is about our story which has changed and disrupt our foundational principle for our distribution. Now this technology can enable our partners to build a technology or this technology can help the financial institutions to use by their own IT teams by using our eMACH.ai platform.

So the problem which you are discussing as an investor that when are we signing partners, I think this is the right tech, we are preparing for — where it is much easier for partner to get signed-up for eMACH.ai and that’s what during the call Manish may update you about what progress we have made in the partnership side.

So today purpose of the call is to take you through this results, last year same time in the month of May we said that we will be reinvesting. 5% of our cash margins to build up a next generation technology. And we will ensure that cash has maintained at the same pace as what we had. We were able to deliver the same cash as last year in-spite of investing for eMACH.ai, the next generation platform.

Second thing we looked at this margin should be — it was 24.5% last year. We were looking 5% so our annual margin this time is 20% which is also what are in-line with what we discussed with you. Third thing is we always look at it that Intellect can only be measured by last 12 months revenue not quarterly revenue. Our business model doesn’t permit for us to get evaluated on quarter-on-quarter margin. I want to insist again that please stop and looking at comparing Intellect with the service companies. There’s a completely different models.

There’s no comparison from service industry versus product company or technology companies. Intellect is a technology company. So please look at it last 12 months. Last 12 months we consistently, in last four quarters, we maintained our growth rate more than 20%. Even in-quarter 1, quarter 2, quarter 3, quarter 4, the last 12 months growth rate was 20%.

So that is what we designed our business for. And this business which is accelerating our CAGR of last five years is 16%. Our CAGR of last three year is 18%, and CAGR of last two years is over 20%. So it’s accelerating CAGR in last five years of our journey.

At this point of time, I checked up the investor has four questions.

Praveen Malik — Vice President, Investor Relations

Just bear with us.

Arun Jain — Chairman & Managing Director

Hello, can you hear me now, Parveen?

Praveen Malik — Vice President, Investor Relations

Yes, Arun.

Arun Jain — Chairman & Managing Director

Can you hear me.

Praveen Malik — Vice President, Investor Relations

Yeah, yes, definitely. Arun, it’s fine now. Yes, Arun it’s fine.

Banesh Prabhu — Chief Executive Officer, Intellect AI

We can hear you, Arun.

Arun Jain — Chairman & Managing Director

Okay, so the first is how to grow. Portfolio model is the one critical model, where we have chosen for LOBs to grow simultaneously. Now each LOB is having their own portfolio for the growth of the business. Second is, we have presence in 57 different countries. So our business is not dependent on particular geography, and we are the large — we are the most diversified company, which are operating in the largest client in Asia, largest client in the Middle East largest client in Europe, largest client in Europe, and America’s.

Looking at it, what new challenges are, our challenges are distribution now. So Intellect 3.0 is about distribution, which will give us a headroom to grow. The second question is headroom for margin growth. Our licensing margin revenue comes from three sources, Direct Line success, platform revenue and AMC, all three are growing healthily in the business,

Assurance of growth, assurance of growth come from our client quality, our technology differentiation, and are we solving the right problem? When Banesh, Rajesh and Maneesh will take you through, they will try to assure you that there is a huge growth potential they are seeing.

Related to risk, the fourth question. Yes, geopolitical risks we have seen over the last seven years, starting from Brexit to Trump and to Ukraine war to now US and America crash of the banks. Those are part and parcel of our business portfolio. It does impact two to three quarters when the industry start assimilating the impact of such kind of a risk.

Second is deals cycle closure, cycle time. That is not predictable in a large deal like what business we are in, so which cannot be quarter-on-quarter. And third is, which is coming in now, where the banks are becoming more committed for the payments will be milestone-driven. So the other three risks which is there, which we identified. We will discuss it if you have some more questions regarding it.

At this point of time, I want to hand over to Banesh to share with us what is exciting story of AI with a combination of wealth and insurance playing out in a market over. Over to Banesh. After that Rajesh will tell you the story of how the core banking systems, which is why the banks are looking for transformation of core banking systems now, why BankTech Wave 5 is so critical for core bank system, which was to some extent slowing down and how the Thought Machine and Temenos is competing. Manish’s story you know more of — you just told the GTB story, but GTB story has migrated to significantly in consumerization of corporate banking. It’s amazing stories how differentiation is coming in that global market space. So Manish will share you that story. And then I summarize later.

Over to you, Banesh.

Banesh Prabhu — Chief Executive Officer, Intellect AI

Yeah, Can I — Praveen can I request you to share the slide?

Arun Jain — Chairman & Managing Director

Banesh you can do it yourself maybe.

Banesh Prabhu — Chief Executive Officer, Intellect AI

No, it’s not letting me. That’s why I’m — you want to start Manish. Then I can cover the one later on?

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Let Rajesh come.

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

Okay. So let me — I hope you can hear me? So let me take it from here. And let me just start by sharing my screen. So I hope you can see my screen. So let me start. So first of all, good morning, good afternoon, and good evening. And thank you for joining this conference call. And it’s good to be talking to you again.

So let me start and talk about today’s presentation in really in four sections. So in section one, I’ll talk about the market opportunity, some key trends and talk about our competitors. While Arun has already talked about the financials of year 2023, FY2023, I’ll try to put a little bit of color by giving you a qualitative feel of year 2023.

The third section we will talk a little bit about growth strategy, which is very similar to what I’ve said in the past. But I’ll just recap that again. And we’ll talk about a little bit more about marketing. I think this year, we are focusing more on marketing, from distribution and marketing. So I’ll talk a little bit about that.

So I think when we look at the market size, from a TAM perspective, FY23, the retail banking space is about $23 billion, which is growing at a CAGR about 8%. So that takes from $23 billion to $29 billion. But what’s interesting about this market is while it’s growing at an 8% CAGR, the shift in the SaaS, SaaS piece of this market is really growing by 34%, while the in-premise business is only growing by 8%.

So the SaaS business, which is about 14% of the total market spend right now in FY29 is estimated to go to 30%. And that’s where our business model at eMACH.ai is the space that we are playing in. Also from a non-traditional players, these are players like specialists banks, digital banks and other Fintech players, we are seeing that that component of the business is also growing. So that’s a little bit about the market.

From a from an Intellect perspective, you should look at the Intellect service addressable market, it’s about $11 billion, growing at about 8% to 10% CAGR. And therefore from a retail banking space, we believe there is a huge headroom for us to grow our business in the coming years.

Talk a little bit about some of the trends that we are seeing in the market. So I think the first trend that we are seeing really is about digital transformation, especially relating to the bank’s customers, and specifically on customer onboarding. We are also seeing that customers are expecting banks to participate in embedded finance user journeys, as the customer goes through that journey. For example, just to make this a little bit clearer, let’s say a bank’s customer is on amazon.in, buying a product, buying a let’s say a white goods product. Suddenly he doesn’t want to pay in full. He wants to take a loan. He or she expects the bank to be a part of that journey and be able to offer that load during their journey.

So that’s where embedded finance and we are seeing that trend growing. So that’s the first trend. The second trend, I think I already talked about it. It’s an accelerated shift to SaaS and cloud. We are seeing that trend growing in all markets across the world. The third trend is really about how banks can use data insights and embedded AIs in the customer journeys to create hyper personalized customer experience, which is lifestyle-oriented and contextual.

The fourth strategy is really about how banks can work with partners and Fintechs to create an ecosystem, and through this ecosystem, everyone plays. I think a couple of years back there was always this debate about banks and Fintechs. I think banks have now understood how to play in this game and also we are seeing the trend of how banks can become marketplaces. In certain advanced markets we are seeing ESG as a very key driver, especially on the environmental space. And in the central banking space that we play, we are seeing digital currencies. We are seeing many central banks either doing POCs or launching digital currencies.

So these are the six key trends that when we talk to the bank CEOs, retail bank heads, CIOs, Chief Digital Officers, these are the six key trends that the banks talk about. And it is important because our business model is built around those — around these six key trends. I think from a technology perspective, I think the kind of investments that we have done in the last couple of years, whether it’s relating to cloud SaaS, API, micro-services, DevSecOps, insights, data, AI and distributed DB, and I think 2025 to 2030, we expect these technologies to further evolve.

So from an intellect perspective, the good part is that we have already started — we already started our journey a couple of years back and we have made significant progress in some of these trends. So talk a little bit about year 2023. I think we were well-covered from an analyst perspective for the sixth consecutive year, IBS rated us as the number-one in retail banking. They also rated as a global leader in product breadth, as well as retail lending.

From a Forrester perspective we were rated as a leader in the Forrester Wave Digital Banking Processing Platform for retail banking. We are in Gartner’s 7 time leader in Gartner’s Magic Quadrant and Chartis also rated our digital lending solution as best-of-breed. So I think we’ve got a lot of quality, analyst coverage during the year. I think — we believe that — we also did in the month of February, I think Arun talked about it. We had our first BankTech Wave 5 event in Mumbai and during that time, we were be happy to launch iKredit360, a specialist credit platform built for India in India and I’ll show a couple of pictures around that, and talk a little bit about the value proposition that we have built for iKredit360 in India.

We believe that this platform, which is specialist credit platform can really help democratize credit in this country. So let me talk — I think the key proposition of iKredit360 that we have, in a nutshell, it’s a complete 360 asset platform. What that means is that any credit product, whether you want to launch an SME financing, you want to launch credit cards, you want to launch agricultural loan, gold load, every credit product can be configured on this platform. It is built on as eMACH.ai architecture, which means that it’s micro-services, API, cloud headless and event-driven architecture, the model that we have is really on pay-as-you-grow.

So you pay us a small upfront fee and you pay-as-you-grow based on the number of transactions and what’s very critical is that it is in-built India already that — what it gives us that all the key partners, Fintech, government agencies are already integrated with this platform, which significantly reduces time-to-market for banks as well as makes this platform regulatory ready. During that event, we launched two products, SME Lending, SME Finance and Lending platform in India. And the second platform that we launched was about digital cards. So on SME Financing, the platform actually takes care of 16 types of SME financing that you can do. And it’s a model which is completely India ready.

And on the cards fees, it’s a complete front-to-back model, which also has the potential to launch a green card. Following India’s event the second event that we did was in UK where we really launched our UK Open finance platform. Let me show you a little bit about what we did in London. Sorry. Okay, so maybe let me — so this was followed by our second event in London. And in that event, we actually — which was done in collaboration with Celant and AWS banking. For London, we actually launched the open finance platform, which is UK and Europe ready. Based on our eMACH.ai architecture, it was very well-received.

We had about more than 60 banks, customers and prospects looking at our platform and we are continuing to progress on this from a euro perspective. I wanted to now talk a little bit about two used cases. So I think this is the first use case is really about our Central Bank use case, where we launched the commercial portal for these banks. And just talk a little bit about what this portal does for this commercial bank. So this is serving about 240 commercial banks, which has about more than 15,000 users and this the first time we build a platform which is multi-lingual. We have actually started with English and Hindi, but it has the capability of going into regional services.

The platform offers 120-plus banking services and 175 PTO services. And for the first time any central bank has actually gone on an enterprise cloud. So this platform is on VMware Tanzu Cloud. It is the first time where we have gone through a very severe security clearances, and we had to go through a professor at IIT Kanpur because security is a very big concern from being a commercial portal and the first time we have through our iTurmeric platform we have insured a 100% coexistence.

What it means is that we have the old platform, Equiware 1 [Phonetic], one and the new platform Equiware 2 [Phonetic]. And we have the ability for a user, for a certain bank to be on Equiware 1 and certain banks on Equiware, and within a bank also some users can be on Equiware 1 and some users can be on Equiware 2. So this is a great tool from migration and reduces any risk from a migration perspective.

The second use-case that I wanted to talk about is the SME marketplace that we have launched. This is for one of the largest private banks in India. And this is a bank which over the last one year has gained — has improved its market-share from 19% to 24%. The platform is really about a cloud-native solution which is implemented on a private Google Cloud where the customer, the SME can self-onboard. So prior to pandemic the process in this bank used to be that an SME would go to an RM sit across the RM and give all the data and that process of approving that could take anywhere between 7 to 10 days. Now what the bank has done is that SME can on-board himself or herself, by using a micro site, with very little data entry, with very few fields of data entry and through multiple API calls that we make with many important Fintechs and partners, we are able to get that information and make almost Real-time decision.

So this we do through a 129 APIs, 11 PBC. We built 67 interfaces for just for approving these RMs. Today the bank is processing about 70,000 applications that disburses more than 7,000 crores of fund from this platform. This is, we believe this is a hot space in India and this platform can really democratization the SME financing from a technology perspective in India.

Moving on, I think I’ll talk a little bit about our strategy. Our strategy continues to-be-built our product and platform, a focus continued, focus on Europe, a principal solution provider strategy and destiny deals are focused on talent. I think this is an important slide. I’ll spend a couple of minutes on this slide. I think when we look at our business, we are looking at our business as four products, three platforms and one technology. The four products that we talk about is, IDC and when we talk about IDC, this is core banking, lending, credit cards, AML, treasury, et cetera. It’s the most, from a breadth perspective, it is the widest product suite that is available in the market and the deepest from the types of user stories that we have.

The second product, which is — which we sell is digital lending. The third product is really about our central banking proposition, a market leading central banking product proposition, which we call as Quantum. And the fourth is on Capital Q [Phonetic], which is our treasury and ALM product. As we had originally had products, we are not moving in that journey from — to a platform and the three platforms that we have is eMACH.ai. This is our open finance platform. iKredit360, it’s a curated credit platform, a digital experiences platform. This is a front-end layer and iTurmeric which is our technology.

I want to spend a couple of minutes talking about the key value propositions of some of these — some of the products and the platform. So from a product perspective, I think if you look at IDC the key USP on IDC it’s a composable and extensible business component. It is built on an eMACH.ai architecture. And as I said, from a breadth and depth of the solution, it is the widest and includes end-to-end loan lifecycle, credit cards and treasury, and from a product perspective in our strategic markets, we have country ready model bank\s platforms for targeted countries.

What it helps us is that it enables a shorter implementation time. From a lending perspective, what we’re seeing in the market space, is a great need for a one origination platform. One origination platform is really a single platform, which can take origination for retail, commercial as well as corporate. The digital lending suite that we have has a comprehensive lifecycle management and has multiple channel leads, such as Microsoft Customer Office, RM Office et-cetera.

From a Quantum perspective, which is our central banking solution, we look at our key USPs on digital transformation how we get enable central banks to implement policies faster to keep pace with everchanging interconnected global landscape. It seamlessly connects four pillars of the nation, the government, the Central Bank, FIs and public. It helps the central banks to provide real-time visibility of operations and it really — while this is a full product, it actually has two different pillars in this platform.

From a Capital Q perspective this is a product which is seamlessly — which seamlessly integrates the front-office, middle office and back office with in-built ALM and RFR, and it has a real — it can give the bank a real time visibility of cash flow and risk and portfolio risk analytics. From a platform perspective. I think eMACH.ai this is — as I said, this is our open finance enabled platform. It is a ready integrated ecosystem. It is regulatory compliant in the markets that we are working. It is available on PaaS and it’s on eMACH.ai architecture. From a iKredit360 perspective, this is a complete 360 assets platform where banks can curate innovative credit experiences over the cloud. It has the eMACH.ai building block and it has multi-tenant credit-as-a-service platform. And this comes pre-integrated with best-in class Fintech partners to offer differentiated solutions.

From a digital experience platform, it’s about composable contextual and collaborate. From a composable perspective, the banks can design their own UI. It has domain services across acquisition, banking services, engagement services beyond banking services and foundation services contextualized via using embedded AI and ML for building propensity models and collaborate — it works in an ecosystem with integration with many Fintechs and partners.

So that’s really about our product platform and technology story. Let me just — I think I just wanted to talk a little bit about. Europe. I think we have reinvigorated our team in Europe with a senior person’s induction. We have built — continue to buildup pre-sales and delivery capability. We have three referenceable clients which have gone live, Catrell [Phonetic] auto and resources in the process of going live. We now have fully hosted solutions in AWS, Germany and UK. We have build a good pipeline in UK, Europe and Canada and we are, as I said earlier, we are now hosting multiple events in UK and Europe,

So I think that was really about our this think. I think a little bit about principal solution provider So what we’re looking at is really looking at five accounts in this year to see how we can build a principal solution strategy around lending with these banks. And we continue to remain focused on the destiny deals. Destiny deals are very important for us and we will continue to remain focused on that.

I think on the last piece, which is really all about talent. I think we are in the talent business and therefore, we are focusing on — we continue to remain focused on talent. And from a talent perspective, we are really looking at talent development, cost and efficiency and people engagement and learning. So these are the three pillars that we are working on from a talent perspective. So that’s really what. I had. I think from a marketing perspective I can just quickly talk about saying we are very happy for the first time we have decided to participate in Money 2020. We are participating in the Money 2020 which will be held in June in Amsterdam and where we will be showcasing our signatures, how banks can build their own solution, signature solution on our Open Finance platform.

We’re looking at that, we are looking at a digital marketing course. The way IGTB Oxford and we are looking at increasing our marketing participation in our marketing events in our key markets and along our key products. So that’s really what I had. And I think with that let me hand it over to Banesh.

Arun Jain — Chairman & Managing Director

So Rajesh, before handing over, what is your competitive landscape, Rajesh.

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

So I think very interesting question. And I think from a competitive landscape, what we’re seeing is that if you really look at markets in Europe, and you look at Tier 1 banks or even if you look at large banks in the regional space, we are really facing three — two competitors and us. So the competitors that we face is really Temenos, Thought Machine and Intellect. So in many deals, we are in last three, with these banks and these are very large deals. And these could be Tier-1 bank deals. This could be regional tier bank deals, et-cetera.

So and I think we are uniquely uniquely positioned when we compare ourselves between Temenos, which we think is a little bit of a old legacy platform. It has a very monolithic architecture and Thought Machine, which is really built on the latest technology, but doesn’t have the depth and the breadth which is required from a financial services perspective. So I think with the eMACH.ai architecture as well as the depth and breadth that we already had in our solution, we are uniquely positioned to be able to look at this market space.

And I think Arun talked about this. A couple of years back, we were — the market was looking at following the core or building around our core and not touching the core. What we’re now seeing from a market trend perspective is that most of the banks are looking at core transformation because they are not able to get the benefit by using only surround system. And I think with the new architecture that we have, the cloud technologies, [Indecipherable] the eMACH.ai architecture, yes, has become lower and therefore we are seeing a good market opportunity in large core banking transformation. That’s the trend we are seeing.

And we are, as I said, see Temenos and Thought Machine, but we believe that we are well-positioned, because of our latest architecture as well as the depth of breadth that we have from a financial perspective.

Arun Jain — Chairman & Managing Director

Thank you. Over to Banesh.

Banesh Prabhu — Chief Executive Officer, Intellect AI

Yeah. I think some issue with my screen not being able to share on Zoom. So they’re going to present it for me, yeah. I will tell you when you need to switch the slides here. Let’s start full screen. Okay. So hi. Good evening. This is Banesh. I’m going to sort of talk to you about Intellect AI business and some of our learnings the Intellect AI business has had in ’23-’24 and how Intellect AI has positioned itself very well for the evolution that we are seeing in technology.

I mean, we are moving very rapidly at a fast maturing pace from a digital age to Information age evolution and how Intellect AI actually is positioned. I think the approach that we’ve had from the beginning, using data and AI as the first approach along with our eMACH architecture for creating AI and data models.

I’m going to actually have a few slides, but I’m going to actually talk to you for each of the themes. To start with, I think our business trajectory during the year ’22-’23 was very positive. We experienced growth and expansion across our costumers, and also in many of our geographies for our wealth business. Our continuous innovation in products and platforms using embedded AI has now started providing us with some unique edge to quickly fulfill our varied customer demands and there is a lot of demand coming out on the embedded AI solutions for specific areas in their business.

So I’m going to touch on three businesses, one is the insurance business, which is primarily focused on the US, but is slowly expanding into the UK and Europe. Our wealth business which is in several geographies right now and is expanding quite quickly. And I’m also going to talk to you about the very exciting area that we are seeing for our ESG business that we have started with a few clients and also the potential of what we had launched as Magic Invoice in India, eventually occupying the accounts payable opportunity, which is also very large. All of them use our same embedded AI platforms that I will touch on eventually as the technology and how we’ve invested in this technology, through various waves, using data and AI first, as an approach.

So next slide. So I’m going to have a couple of slides on the US Insurance business, which I’m going to start with first. Firstly, North America, as we all know has been pretty challenged economically for financial institutions. However our insurance business actually is progressing. Most of the insurance businesses are progressing very well in the economy. And with the present risk scenario we actually see great opportunity for the insurance business, specifically the insurance business-related to next generation underwriting efficiency. They do want to underwrite risk more efficiently in this very high risk environment.

So if you see the slide, we are one of the few providers who focus on a combination of data using risk analyst as a product. For injection we use our Magic Submission. I’m going to touch on that a little bit later, and a very successful completely MACH architected intelligent underwriting platform Exponent. We also have partners and partners — so we’re not — we don’t build policy admin systems, but we have partners in policy admin. So wherever the client wants to specifically focus on a particular type of business we would give them a partner, our partner systems for policy admin.

So If we can move to the next slide, Magic Submission and Exponent end to end underwriting with enriched data coming from our risk analyst product is actually creating a comprehensive underwriting ecosystem that our clients are actually now very interested in implementing slowly for different businesses. So we’ve built data models through AI to enable various business lines such as property, general liability, workers’ comp business auto. And right now, we’re working with many clients on putting together specialty lines and excess and surplus lines leveraging Intellect’s iTurmeric no code low-code platform.

So our deep customer-centric focus actually provides us both cross product, and cross-business ecosystem. So what this really means is that we are in a position to get into a client, maybe with Magic Submission. In the earlier slide you saw the ingestion capability and then extended to specific lines of business, there are many lines of business, some insurance companies do few lines of business, some others do many lines of business. And they actually enter into a specific area either a business, either a specific function of just Magic Submission ingestion. Then we use data as a separate product. And sometimes we add to it the ability to even take it end-to-end to underwriting.

I think that combination has worked extremely well, and has given us a strong focus on landing and expanding with our clients. Our plan this year would be to exceed one million submissions through Magic Submission. And the pricing is based per submission, and this is done every year. We are about 80% faster in processing time and 20% higher data quality.

If you could just move to the next slide. We are 80% faster in processing time and 20% higher data quality. But our enhanced capabilities on monthly channel ingestion, we can take data from multi-channels, we can take different kinds of data. We can enrich the data and then what we do is we embed AI to provide, things like submission prioritization. So I will touch on this first point on decision-making time. Many of our systems are actually helping the client prioritize submissions much faster and choose through our AI embedded platform faster submissions for underwriting compared to the old BPO model, which had a lot of processing delays and human limitations.

So our target is actually to go after the BPO industry for Magic Submission. And actually, we — therefore if you saw the competition slide we had Conver [Phonetic] and Ground Speed, which are the two competitors. This combination of putting together intelligence of AI embedded is something that many of them do not have, which is why we are getting a lot of traction. The market TAM is expected to be about a 100 million submissions every year. And our position in this vital area in underwriting shows enormous growth to be able to process with all of these operational capabilities for our customers going ahead.

We continue to obtain an edge over competition such as Guidewire and Duck Creek. Now Guidewire and Duck Creek are the big policy admin providers who also do underwriting. But I think the capability of our underwriting ecosystem makes us a lot stronger than Duck Creek and Guidewire and actually doesn’t — most people are slowly moving away from those platforms or many of them have been doing underwriting outside of those platforms and we actually are the best solution to be able to use our MACH architecture along with the embedded intelligence, to be able to help them manage the end-to-end process and with partners, we have partners for example to do rating of risk. We have partners to do policy admin capabilities. I think that ecosystem provider is attracting a lot of attention from some of our clients.

To this effect our GTM focus now includes three aspects. One it’s expanding the TAM to all those businesses I mentioned property, casualty and so on. That is number one. Second, a custom offering leveraging Intellect’s proprietary low-code platform iTurmeric in specialty insurance. This is where we write, special insurance for a particular need. And we have not normally done that in the past and this is something now we built the capability along with our underwriting platform and iTurmeric fulfilling that requirement. So that’s expanding our TAM in a new area.

And thirdly, we moved away from carriers to support MGAs, wholesalers and reinsurers. And we believe that the TAM approximately a $5 billion per year on just the technology side for US and UK is where we believe is the opportunity. I think our specific target within that is somewhere in the $3 billion range. Now we have 13 customers onboarded, a very healthy pipeline. And quite a few in contracting at this stage with our newly-created upstream, we deal with that exception processing that we have for some amount of our AI capability brings exceptions. We’ve created an end-to-end capability to deal with that operations capability.

And what that operations capability learning does is that it helps us further in our deep learning and machine-learning algorithms further improved performance. So those are few other things I wanted to touch on the wealth business. I’m going to now talk to the insurance business. Now I’m going to talk to you about the wealth business, if you could go to the next slide, please.

Okay, so wealth, interesting space. I think I’ll start with saying that global market trends are showing that we’ve almost tripled the assets under management and many of you, our investors and the growth in assets under management in the past decade has been enormous. There is a continuous increase in liquid assets and number of high-net worth all over the world in many, many places. Wealth management firms and banks are struggling to provide new age AI-driven technology experiences and renew products to adapt to these new business models. So you will see over here, we are focusing on a variety of segments, right, down from the ultra-high net worth and private bank on one-hand and to the mass wealth, on the other hand.

And there is a need to actually enhance the capability to provide scale for the relationship managers and the investment managers to be able to service more customers and to know more about the customers, and more about their risk appetite to be able to provide them the right products. And there is an enormous amount of wealth transfer taking place to new people. So the ability to bring in new customers and at the same time, retain existing customers is very critical.

If you can go to the next slide, I think one thing I wanted to touch on here is that we’ve started sort of pioneering a differentiated experience for wealth managers and banks. And a superior service for both clients using a platform which we call Wealth Force.ai [Phonetic]. We believe technology role is to complement the RM and not compete with it. It is a very emotive business. And we digitize with embedded intelligence, all those business tasks in the daily life of the financial advisor, so that they can provide the personal touch in the digital age and help them have embedded AI-powered analysis to supplement their skills.

So I’m going to touch little bit on Wealth Force.ai,, if you can go to the next slide. So Wealth Force.ai that we are now in the process of implementing in quite a few markets we believe that it has got three key models. Firstly, it’s got an eMACH.ai, which we’ve already touched on architecture. We use our Fabric Data Platform and this new offering is the most comprehensive no touch, low touch financial advisor or RM solution. And it’s built on these three pillars, hyper automation to absolutely reduce the operation’s friction that are customer — that a relationship manager and a customer face in their transactions.

Second is hyper personalization. We believe that there is enormous need to be able to match the right risk products to the right customers at the right time. And normally the relationship manager doesn’t just have all that capability and how do we supplement his skills with the capability to do that, and therefore, result in a modern customer experience. Wherever we have implemented this, it’s actually helped the wealth business grow their relationship manager performance significantly. And we hope that we could scale this up in several other geographies going forth.

So what are some examples of that. If you go to the next slide, please. Contextual recommendations. The differentiator with this product is its hyper personalized embedded AI for contextual portfolio recommendations. It actually helps clients increase their wallet shares. It helps the business, not just with the wallet share increase, but it also helps individual investment value systems to be tailored to suit the customer requirements. So very often the customer needs a tailored solution to suit, what he wants, and the ability to understand the customer and to tailor the right solution to him is really the focus of providing. These are some examples of how the AI is embedded in this particular — in this particular area.

Next slide talks about, nudges. How do we create smart nudges. These are personnel triggers customized whether a person wants to be socially responsible investment or he wants the NextGen analytics for his portfolio, and for their business performance. It is a deeper analysis of the portfolio that we do. And therefore, we provide the right nudges to the customer at the right time.

The next slide. And then we provide this end-to-end portfolio performance evaluation that we can help the RM have available on his desktop at any point, when he is dealing with the customer, and we have collaboration tools between the financial advisor and the customer, so that we can actually retain and deepen our customer relationships to provide them the engagement and collaboration at the right time. And I think the whole focus is about making the RM successful.

We have about 20 customers between wealth and capital markets, and active pipeline discussions in various geographies right now in-progress and we already work with three of the top five banks, mutual fund wealth distribution in India. And almost all of the local custodians in India, use our custody platforms. In addition, we sort of manage 20% of India’s mutual fund volumes on our existing platform that we have implemented with the mutual fund associations. So I think our combination of MACH, and our embedded AI for wealth is coming together very strongly focused on the financial advisor, and the relationship manager.

If you go to the next slide, I wanted to touch very quickly on the fact that Wealth Force.ai can be implemented independently or together with our core wealth platform called Wealth Qube. This Wealth Qube really covers the full suite of six offices and 23 desks covering 150 tools to help complete wealth management for a company. Now some organizations only want to implement their financial advisor, while others would like to actually to do the end-to-end implementation. Some of them want to start with wealth and then move into a progressive transformation of their old platforms, because they don’t want to do everything together.

So I think our capability to be able to focus on that for wealth is vitally important. And I think, we hope that we will be able to launch very soon the Wealth Force.ai in most of the key wealth hubs around the world that we are actually analyzing at this point and finding out who we will compete within these markets. We believe Wealth Force in the present three pillars, I talked about, hyper automation, hyper personalization and a superior customer experience, is not actually in its exact share. Having a lot of very clear competition there are different Fintechs doing different pieces of this, but the complete architecture along with MACH can be very well-positioned for ourselves going forth.

So that’s what I had on wealth. I’m going to touch on ESG. If you just go to the next page. So as you know, lot of folks when we talk about ESG, think immediately about environment and climate. But this slide sort of show you environment, social and governance and the various subcomponents. The platform is already live with one of the world’s largest sovereign wealth funds and we actually in the process of implementing and upgrading it to cover all these various blocks and a lot of other data around it. But presently it runs on AWS Cloud and it already has a coverage of 6,500 companies globally.

A few 100 India listed companies are already present and we want to expand that to cover the whole index in India very soon. We know that there are regulatory mandates both from SEBI and of course with all the other global countries, whether it’s UK or regions such as Europe and the US. So iESG uses the power of machine learning to deliver contextually relevant information around each of these blocks of environment, social and governance. It is unlocking intelligence that is required for enabling much better risk analysis than just looking at financial risk. I think people — organizations want to look at environment, social and governance in some markets governance becomes very critical as we’ve seen.

The combination of looking at risk in a holistic way to look at all elements beyond financial risk is what this suite really offers for us. And this is what we are in a position today to provide.

Just go to the next slide. So iESG is built on the foundations of explainable AI for ultimate transparency and auditability. Now if you see the slide and you’ll see there are four rating agencies which are the different blocks for each of this. So if you look at whether Apple and you’ll see four rating agencies rating ESG overall or even elements of E, S and G at different levels. The same rating agencies and all these are very large global rating agencies, we are talking about, okay.

Now this has been a concern that, you can’t just accept the best forum. But you should be able to get have explained ability of where the data came from. So our explainable AI takes you down to drill from where the data sources come from. So this whole contextually relevant environment, social and governance related data of clients to unlock intelligence is done in such a way that will give you a much better view to risk analysis than you would have before.

So this is an explainable AI. Lots ESG ratings are today providing scores, but all of them lack the granularity required to make this into an effective business, great decision. Now whether you use ESC for risk, or you use ESG for impact. It actually helps asset managers and funds to make competitively different investment decisions and allows banks to incorporate sustainability risks and impact into their pricing and lending offers and it greatly simplifies the financial service related reporting activities that are required by most regulators around the world. And those regulations are evolving as we know.

If you just go to the next page. So IESG vision that we have, this is Intellect’s ESG Edge product is to create a world driven by transparent and sustainable ethical financing within the context of an ever shifting regulatory and customer preference landscape. We aim at cracking the problem of non-exposed, data lineage, limited and contradictory industry scores and manually intensive investigative processes. So the differentiation in our product comes with customizable ESG data.

So we actually help you take that data and score it. Now when I say you I would mean asset managers, banks that want to deal with different companies. We would actually give them the ability to create a scoring framework that is tailored according to them on all the data risks that we provide them along with where the data comes. And this actually creates an explainable AI situation to help clients drive accurate insights. And this is done in near real time. So iESG is a very powerful enough to run company sustainable sustainability reports, on custom metrics against thousands of companies at one time, both for the portfolio as well as at the industry level.

It is clearly eMACH it’s an eMACH architecture, is hosted on AWS Cloud. It uses fabric data platform that Arun mentioned. It’s got 40 plus ESG topic categories with real-time comprehensive sustainability insights for you and we can show you some of these reports on a separate discussion. We plan to have about 150 data points represented in the next few months. And needless to mention today. iESG will cover investment portfolio that is over $1.3 trillion as assets under management.

So very comprehensive, addressing present issues in data and data explainability and is already being used for many companies around the world and we think we would be in a position to provide people the ability to access this ESG data and then to help them score it and manage the trail of scoring it through a record of how they scored it and why they scored at that point of time. And to get insights into when they need to change this score. So that’s a bit of picture on ESG. It is something that’s very important right now and evolving quite rapidly. And we’ve actually been able to leverage our data and our AI platforms to help service it, which is why the world’s largest sovereign wealth fund chose us compared to competition, which was pretty much all the major players that do ESG scoring today.

I’m going to touch on one more new business area. If you go to the next slide, very quickly. So I want to touch on another cutting-edge AI solution, which leverages both eMACH architecture and our Dock 2 API Intelligent Document Processing automation platform. It was implemented for Magic Invoice, which is now in the accounts payable automation space. I think Magic invoice intelligently automates the end-to-end account payable process. Some key differentiators of Magic Invoice include smarter handling of format variations, multi modes of invoices because as you know in come in multi modes.

We ingest that data from those invoices we integrate across internal and external ecosystems and accounting providers. We provide quality improvement documents in case documents need to be further improved on, we improve the quality of some of those documents, resulting in higher accuracy and validation. And thereafter, verification of all purchasing data. This multi hierarchy approval process also means that the right people can approve the right things and end-to-end this approval process, the processing process, again, we are targeting, lot of the BPO industry that does this. I think it significantly upgraded with updated with this capability.

We have seven clients and we hope to sign many more which are in the pipeline. If you go to the next page. So some of these competitive advantages advantages is a competition of bringing together our — again our fabric data platform, again rolled-out on a cloud on AWS, and is rapidly element eliminating operational processes in the invoice management flow.

And if you go to the next slide. And the value proposition if we didn’t look at it, the Magic Invoice enterprise can expect to eliminate data entry of invoices, reduce cost of processing, significant reduction in fraud overall operational efficiency ultimately freeing up a lot of time for the CFO and the finance function to leverage the data is a source of financial insights, so that they can improve the cash flow for the company, attractive vendor discounts where appropriate and faster payment cycles and better visibility across the overall function.

We expect in the next few months to also add sophisticated capabilities of matching the invoices with POs and, real-time comprehensive insights to further strengthen the product capability, and its value proposition. So these are 4 businesses we spoke about at a high-level. There was insurance. There was the wealth. Business, there was the ESG side of the business, connected in a way to wealth as well as to banks that want to use it. And the final one that I touched on is the accounts payable invoice processing business.

Now if you go to the next slide, I’m going to touch a few minutes on the technology of how we implemented this AI. Next slide. So our shift from products to a data and AI as a platform with intelligent document and data processing capability houses a variety of data models for specific AI outcomes across right now, wealth and insurance, but many other businesses in INTELLECT are winning to tap on these capabilities. These capabilities allow users to gain that extra intelligence and capability. We all know how people do it in ChatGPT across areas today, and I’m sure many of you are using it.

But this is very specifically related to a specific business outcome, and therefore, our products and intelligence come together along with the right workflow to fulfill whether it was underwriting or the relationship manager that I spoke about. So specific tasks and over time is going to be utilized by many products because this platform is evolving quite rapidly. It has fabric data services as well as the intelligent document processing platforms. The four systems that you see on the top, I talked to you about 3 of them.

If you go to the next slide and do this in stages, okay, one at a time. I’ll tell you when to click. So the first stage, if you see this is a progressive sophistication of our product and platform ecosystem. We will create a differentiated customer service ability to entities to build and configure their own capabilities. I think between 2015 and 2018, we saw the first wave of what Intellect invested in an AI and data platform, both for sentiment analysis and data aggregation.

If you click forward, in wave two, between 2018 and 2020, we started using this platform for one of the largest wealth providers in the UK and for all our insurance businesses in the US on the data side with our product risk analyst, which has now been upgraded many times that takes input from multiple data sources and then actually helps you underwrite more efficiently, which I touched on.

The third wave, which has come now between ’21 and ’23, I already touched on Magic Submission, Magic Invoice, ESG and risk analysts. I didn’t touch so much on [Indecipherable]. This will be a variant that will help under ESG focus only on governance and improve the quality of people’s governance. I think in the last call, we had a brief demo on what is the potential of [Indecipherable] and how it can give you governance information.

If you click forward. So the vision is to have an ecosystem of data and AI that is open and innovative to help customers and Fintechs, develop and deploy their own AI models on our fabric platform eventually. That will take a combination of data and intelligence and actually help you implement this at scale for your business for different areas that we will already enable you across the various areas of financial services. So this is a very interesting evolution that’s beginning to take place on the AI side. And our platform’s ability to deal with data and intelligence is coming together very strongly on this fabric platform.

And Intellect AI is using it very strongly for insurance and wealth, but there are several other businesses that will be using it in different ways. You saw Rajesh talk about data and ESG in his slides. And I’m sure Manish has a lot of similar areas that he’s already working with us on in the trade, supply chain payments areas. And I think the Intellect AI, I think, will be positioned very well and has a very strong pipeline going forward. Thanks.

I can hand over to Manish, Arun. If there’s any other–

Arun Jain — Chairman & Managing Director

Yeah, and thank you, Banesh. I think this is the entire fabric platform, what Rajesh has covered, composable platform, eMACH.ai, where the retail banks can compose their own solution. Banesh unit Intellect AI covers entire fabric as a core platform. On the top of it, we are bringing in AI with embedded points. A lot of questions are there on ChatGPT and other things, but this is the final nature of embedding the API into processes. It’s not generative AI. This is varied AI, which is different from it.

And this is — what are we disrupting. We are disrupting the BPO industry today, BPO or KPO industry to make it a next level of robotic automation, which was being promised five years back so we bring to reality with no touch, low touch decision making. With this, the third business unit, which is Manish will take you to the new avatar of GPT, which has evolved in the last seven years of his journey, very distinctive position for the market across the world.

Over to Manish.

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Thanks, Arun. My screen’s visible?

Arun Jain — Chairman & Managing Director

Yeah, all perfect. Voice perfect, screen perfect.

Manish Maakan — Chief Executive Officer, Global Transaction Banking

Thank you very much. Now so thanks for, I think, a very powerful presentation. Banesh. It’s very strongly aligned to the AI future, is definitely inspiring all of us. I’m going to try in the next 20 minutes odd give a shape of where we are and how we are driving profitable growth with market leadership as a core agenda and how we help our customers, our associates, our partners, win with IGTV. That’s the core mantra for today’s session.

I’ll give a quick highlights on what are the banking trends and what technology spends are there because this becomes an input for where we invest and where we grow. And then we look at are our products aligned to it, our customers winning with it and how do you support with a partner ecosystem and what are the analysts continuing to say about us, which we have shared multiple times before. To begin with, if you look at this data from McKinsey, the commercial payments is continuing to grow, and they grew 11% globally.

And if you look at across the $1 trillion mark and 53% of them were commercial payments. So that’s the space we are supporting. And this space is growing, and from a transaction volume has grown 19%. So there’s high growth and the value and velocity and volume, all three variables are continuing to grow as we become more and more digital. What are the industry analysts looking at from trends to support this growth, this kind of volume. What they’re forecasting is what you need is the customer engagement, which is hyper-personalized and has got leveraging AI to offer treasury capabilities.

The payments have to be real time and with ISO 222 formats being swift in rolling them out, how are you going to adapt to that. So there is a common patterns and what sense will you make up that data to monetize it. The third way which we have consistently looked at is the digital transformation, where is the API first and cloud native technologies, which we all have been talking about and delivering to. It is getting to a next level where ecosystems have to be open so that you can embed and be part of a larger network. You get consumed and you consume something so that everyone gets the network effect.

For that, you need embedded banking capabilities and the product innovations are for real time treasuries, commercial loan originations and how do you make trade really 3.0 digital and support the supply chain growth. This is what Salient [Phonetic] says are the core needs, which they are seeing corporates demand of the corporate banks.

Then we look at what is the technology spend happening around the growing volumes and the new capabilities which are required. So it’s about — it’s growing at a 6.5% CAGR, is growing from $7.1 billion to $10.3 billion and $10.3 billion is a corporate banking application only spend. This is the area where we play. This is not the full corporate banking spend. That number is much larger. And out of that, two-third of that is in the transaction banking space. So we, as Intellect IGTB are focused on an addressable market, which is about $7 billion. This just gives you a perspective. I’ll connect back to this towards the end of the slide.

So the transaction volumes are growing, capabilities are becoming real time and closure, and the spends for that is growing. So how are we leveraging that in our product leadership journey? We defined our mission is consumerization of commercial banking. What does it mean in a very simple layman’s language. We, as individual retail customers, we get instant gratification of what we want and we are getting hyper-personalized. Why would a commercial bank be any different where we as individual corporate managers need to consume a technology any differently, why would we expect anything to be a T plus1 kind of a thing.

So all of that is what we are trying to do leveraging our technology, bring down the tool commercial banking, which is a hyperpersonalization, real-time connected journeys, action triggered insights, immediate gratification, friction-free experience at scale, and a desire and trust-based decision making. So we’ve looked at all these six tenets and we are continuing to leverage our technology to deliver use cases to the customer journeys where this can be delivered. Today, we very proudly feel that this — we are only a single global ecosystem for consumerization, which can offer the entire corporate banking exchange, a full digital transaction bank for midsized banks, liquidity, investment, deposit, virtual accounts, cash management, payments, trade, supply chain, all organically built on a single data architecture.

I’ve got a lot of my peers, some very respectful, some very big, larger than me, but they have all gone through acquisitions. And we have seen lack of consistency in architecture, what it does, and that’s what we are seeing some of them fall out. So remaining organic self-funded like Arun called out, this is what we have been driving. And the scale of — I will give you examples while on the screen, it shows what we have managed to do. I will show that in individual products, how we have scaled that up.

All of this has been built on an eMACH.ai architecture, which is the best comment I got of is, Manish from one of my largest customers based out of UK, their group CIO saying, Manish this architecture is wonderful, every architect promises me, every sales company promises me, but what I’m proud to is you have landed it in my environment and we are live on this. That’s the difference between an aspiration, a sales pitch and having in production-grade ready architecture serving close to $1 trillion of deposit base. So that’s the scale it serves with 50-plus countries.

This is our best-selling platform in corporate treasury with now 56 countries and 54 customers. And out of this 24 are amongst the top 100 banks of the size and scale of more than $100 billion asset size. A digital transaction banking for all growth markets and emerging markets, we are in 7 markets, we are practically the de facto standard with more than 70% market share in those markets and continuing to grow deeper with each one of them.

Our virtual accounts is what is the way of helping banks to manage their deposits right now better. We’ve seen how flight of deposits has happened in U.S. And how solutions that can be offered, where you can offer reconciliation real time. So virtual accounts is a very important tool as we go forward in our journey. Payments has been there consistently. And there are many players over there, and we are also amongst them. One of the common things all of us will say, we have these many rails and we are across these many countries.

But not anyone else right now says is that we’ve got cloud-based contact sensitive corporate payments, which means I understand the context of your transaction and they help you take a recommended decision for you what is the best route and what’s the cheapest transaction for you to be able to execute. So that’s a differentiation because of AI we have been able to bring in.

CBX has our largest footprint now with 78 customers. We started this journey taking the assets off city, which all of us know and having built that for more than 100 countries, that journey continues, and we’ve been able to replicate across now 78 customers with 55 country footprint. And it comes with 100-plus user journeys prebuilt with 450 plus open banking APIs creating the integration.

Our youngest platform, which is fortunately born in an age which was micro services and AI, which leverages iColumbus.ai for trade and supply chain. And we’ve now got about 24 customers supporting 11 countries, and we built it around how to leverage AI to simplify trade. Trade is a lot of paper-based process, which happens and how like what Banesh prior to me, showed on Magic Invoice, how we leverage that on Magic LCs and Magic Invoices, and we make all of this work, which is so much paper-based, defect-prone and needs a lot of man power, how we automate and make it trustworthy. So that’s a significant differentiator leveraging AI.

We brought in trade and supply chain, and hope to continue to share more wins around this platform, like we’ve been sharing across all other previous platforms. So with these five products, what’s been our customer leadership journey. I think this is the biggest proud moment for me personally and for all of us at Intellect, our current corporate banking leadership journey. Now more than 60% of the world’s top banks, across every market, if you will see, 4 banks out of 10 in North America, 7 out of 10 in Europe, 9 out of 10 in Middle East, 7 out of 10 in India, 5 out of 10 in Asia and APAC.

These are the scale of customers who are leveraging our technology who are trusting Intellect and who are growing along with us and we’re growing along with them. I don’t think there’s another vendor on corporate banking, who can demonstrate this depth on this width of customer base across the board. I think it’s our moment now. It’s about going deep in them and going into deep in each of these markets and continuing to scale what we managed to do.

So we’ve now crossed — last quarter, we crossed the 100 mark of number of customers for us, which is where continue to focus on cross-selling more products to them to grow our journey. I think all of us cherish looking at this picture and hopefully, all of you will become bigger promoters for Intellect. This is the kind of customer base which we have across the world today. So when you have that customer base, what becomes very important is, do the customers trust you? Are they promoters? So this is a core metric, which I take very personally, and consistently focus on if you deliver first time right to the customer, if you put customer at the center, if you are solving his problems, business will come to you.

Business will come in terms of same customer, business will come in him recommending to others. And as they move, they’ll just call us. Liquidity-as-a-Platform, 70% of our sales are buyers who are not buying it first time. They have bought at least twice before. So that’s the kind of network effect it creates because of the NPS focus on and how we drive this input. This has been led by customer experience very passionately driving it. Interesting to see McKinsey put that down in a statistical form what it does, and we’ve experienced it.

We focus on the customer experience, the growth is 2 times. It’s all about knowing the customers personally and having that one-on-one relationship at all levels, focus on medium to long term versus trying to make a short-term buck from them and consistently measure and improve the customer experience. This is where the magic happens.

This is an example of my top 10 customers, how over the last 10 years, they have continued to grow and consistently are delivering revenues to us. It’s about $450 million in the last 10 years from these 10 accounts only we managed to grow. And it’s continuing focus on go deeper. Each of these customers are marketplace and not an individual customer. And we have been just focused on GTB. And we managed to take some bits of consumer into it. We’ve now taking AI into it. So taking all Intellect assets deeper into these customers, those are our golden nuggets.

This is a slide I’ve shown multiple times. Last time I showed we were at 2.7 products per customer, and we’ve reached 2.9 products per customer. So the continuous focus on cross-selling to the customer and going deeper is showing up. Our target for FY26 is to get 150 customers, which can help and get to four products which can simply by that mathematics, grow to twice our revenue and grow our market share from 2.9% to 6%. Now 6% of market share, if I can extrapolate that to a $7 billion, all I need to do is keep showing my value better, better customer experience. You can all multiply the numbers what it can possibly do.

To support all of this, we’ve built a very strong Power Sage brand, along with iGTB Oxford. Next week, we have our eighth session happening in Oxford London, and this is where the world’s best come in and network and contribute to each other on what’s happening in transaction banking and how we are driving. Again, if you will see every such measure has an NPS score of what it means and why we drive. And this is, again, an example of the banks who come here, who come and design solutions with us. We build joint desire of where the transaction banking is coming, and we trust each other or where we’re going.

I’ll keep this for 10 more seconds so that we can all absorb and see the company we keep. And this is our pride and this is our — something we really live for to serve and grow along with each of these customers. And all of this is supported by our 8012 [Phonetic] Fintech design center. We bring them here — after we drive desire we bring them here. We do POCs, and we help them innovate and deliver what they want to do it.

Now going forward, a very significant focus on last 18 months has been to build two very strong strategic partnership. I’ve shared Microsoft before. The second one we’re now working along with is Accenture. So one strong cloud partner and an AI partner and one strong digital partner. Along with them, the three of us, we are looking at creating magic in the marketplace. This is where something different will happen in the next 3 years. So keep an eye on this, and we’ll keep sharing more with this.

This is the vision we’ve built along with Microsoft to build a network for commercial banking, and this is what we intend to build and scale up to be able to support across the world in these many markets.

Finally, on the analysts. Everyone have reduced the number of presentations, but you can look at each one of them. Every customer writes us number 1 by far in everything. One platform, iColumbus, which is trade finance is the only one which is not number 1. It is number 2. So we live by that value, be number 1 or number 2 or get out of the business, and we’re continuing to lever up and do to that with all the teams committed to take trade and supply chain also to a number 1 platform over the next 3 years, and we’ll keep sharing that journey.

And this is the leadership management team, which you have all seen consistent since inception. All of these individuals, you see they have all been prior customers of Intellect. And that’s why I say it’s been built by customers for customers. Thank you very much.

Arun Jain — Chairman & Managing Director

Thank you, Manish. You finished in 20 minutes’ time. So nice to have it. So now let’s leave for the question-and-answer session, Praveen?

Questions and Answers:

Praveen Malik — Vice President, Investor Relations

Okay. Thank you, Arun. [Operator Instructions] We first have Rucheeta Kadge from iWealth. Please ask your question. Please unmute her.

Arun Jain — Chairman & Managing Director

Rucheeta, you can unmute yourself and ask the question please. Rucheeta? Second number. Put 2 people on the row.

Praveen Malik — Vice President, Investor Relations

Next, we have Mr. Mohit Jain from Anand Rathi Securities. Mohit, please ask your question. Please unmute him.

Mohit Jain — Anand Rathi Securities — Analyst

Yes. So three questions, sir. One is on the license revenue. Now this obviously has been very volatile and extremely strong quarter versus what we thought. But how do we look at license revenues going forward? Do you still see that shift to SaaS happening impacting growth? Or do you think most of it is done and now they will be maintained in proportion? That is one.

And second related question is on SaaS/Platform growth. This number of Y-o-Y appeared a little slower compared to the excitement that is there in the market. So what is happening there? And a related thing is what is the update on GeM. Is it still driving bulk of it? And is it up for renewal next year? And what do we plan to do there?

Arun Jain — Chairman & Managing Director

Okay. So as you — we mentioned in the past that licenses and SaaS are the two options we have to be given to the customer based on their preference. Some people prefer license model and some people prefer SaaS model. So there is a balance of the two options, which is there. Some companies have decided to only offer SaaS. But as Intellect, we are aligned to the customer centricity, and that’s why we are offering both solutions. So predicting a particular year, how much SaaS, how much license, it’s not our agenda. Our agenda is that how much licensing revenue can we grow year-on-year. On the last five year basis our licensing revenue growth is close to 34%. That’s what we want to drive it.

Mohit Jain — Anand Rathi Securities — Analyst

But sir, do you see license revenue also growing year after year? Like initially, we thought over the last few quarters that now shift is happening towards SaaS. So license growth should slow down and SaaS should accelerate. And you also spoke about some slower growth for few years because of the shift. So is that phase broadly behind in terms of customer preferences? Or do you still think that may play out?

Arun Jain — Chairman & Managing Director

We cannot predict anything on this Mohit. You just look at all of them together, three elements together.

Mohit Jain — Anand Rathi Securities — Analyst

Okay.

Arun Jain — Chairman & Managing Director

For investment perspective, all the three elements gives you the licensing revenues, which is a high margin profit.

Mohit Jain — Anand Rathi Securities — Analyst

Right. And sir, second was on the SaaS platform growth Y-o-Y, and then contribution of GeM?

Arun Jain — Chairman & Managing Director

Yeah, so SaaS growth on Y-on-Y, I think GeM is there, but it’s not main contributor/ A lot of contribution coming from AI platform, which Banesh highlighted, Rajesh has highlighted on the customers in Europe. Those are all SaaS platform customers. The revenue buildup in SaaS is back loaded. When we sign the deal by the time we come to the SaaS revenue stream, it is a 12 month to 18 months, sometimes 24 months delay cycle between when we sign the deal and actual SaaS revenue start getting booked. But that’s about SaaS.

GeM is coming for the renewal. So it will be — we are fighting the RFP battle for the renewal of the GeM.

Mohit Jain — Anand Rathi Securities — Analyst

Okay. And sir, last, actually on the finance side. So our cash generation for this year was very low. So what happened here? And how do we see it going forward in FY24?

Arun Jain — Chairman & Managing Director

We mentioned that all our internal transformation happen because of our internal cash generation. I think we reinvested back. So in the month of April last year, we mentioned that we’ll be using our internal cash to drive the change rather than taking a funding from outside. So all this eMACH.ai has happened with that cash. So it’s a great success for us to have them maintain this without diluting a single penny we could able to transform the organization.

Obviously, next year, the cash will be higher in RK [Phonetic] because major investment of eMACH.ai is behind us. So cash generation will be better.

Mohit Jain — Anand Rathi Securities — Analyst

Sir, on the receivable side, like it was also stuck in working capital, some of it apart from the capitalization. So is there any improvement seen there?

Arun Jain — Chairman & Managing Director

It’s not quarter-on-quarter or year-on-year. Sometimes the project completion happens. That contracted now due has grown to INR300 crores. That’s a big number in receivable cycle. Where these back-ended projects I mentioned in the beginning that it’s milestone-based payments. Because of milestone-based payments it becomes due only when a particular milestone is completed. So that is — we have a lock in. This is the kind of a business model we are in.

Mohit Jain — Anand Rathi Securities — Analyst

Okay. And sir, capitalization for the quarter was, how much?

Arun Jain — Chairman & Managing Director

Similar 34, 35.

Mohit Jain — Anand Rathi Securities — Analyst

Okay, perfect sir. Thank you very much. And congratulations on getting back to 20%.

Arun Jain — Chairman & Managing Director

Not getting but you said 20%. It’s a 20%–

Mohit Jain — Anand Rathi Securities — Analyst

Yes. And I understand.

Arun Jain — Chairman & Managing Director

Please, we are not going to get back to anything. We are — trajectory is same expectations are different from you.

Mohit Jain — Anand Rathi Securities — Analyst

No, no. Correct, sir. It was a very strong quarter, indeed.

Arun Jain — Chairman & Managing Director

It was. Okay.

Praveen Malik — Vice President, Investor Relations

Thank you, Next, we have Mr. Anil Sarin from Centrum. Anilji? Hello, Mr. Anil Sarin?

Anil Sarin — Centrum — Analyst

Yes. Sorry, I was on mute. I didn’t realize it. So Arun and team, fantastic and you’ve just sort of lived up to our expectations and you’ve gone beyond. So congratulations on doing what you are doing. Everybody is talking about AI, and you are now — I think a lot of interest will come. You tell us about what you are doing in AI. So congratulations on your foresight and your positioning. I mean people are just doing chat and you are doing — you are finding solutions through AI. So a lot of foresight involved in that.

Sorry. So I’ll just come to the question without wasting everybody’s time that your — one was growth has already been addressed. But if you can just elaborate on the SaaS side, we get the combined thing, SaaS as well as GeM. And the earlier participant has already asked that. But I just wanted to — I wanted your view on where you see the SaaS, given all the banking turmoil that is happening in US, Europe, et cetera. I mean two things. One is how do you see SaaS growing as a percentage of your revenue? That is part one.

And second, with all this negativity that is surrounding, I mean, the recession is fine, but banks, in particular, are getting hit. So how do you get impacted by that?

Arun Jain — Chairman & Managing Director

Okay. So you are asking two questions, basically banking, and — so when banks are getting impacted, they want to reduce their operational costs. There are two agenda banks have. Some people have a very old technology architecture. It’s like managing air conditioning in old building, which is 100 year old. So it costs you more. So you need to change the architecture of the building to commit to the newer building, where all that cost efficiencies can be built in. That’s what Rajesh is doing or eMACH.ai. Manish is doing. He played that [Indecipherable] architecture.

Second part is where SaaS plays a role in our journey. We play a role in specific services to be given, but Banesh has highlighted Magic Submission. Magic Submission is our underwriting policy. So now we are able to provide the unit pricing per policy for end-to-end processing of the policy from the email when the policy comes to the policy get to the table of underwriter. We add all the value addition, validation, data entry, everything, and there’s a unit price of it.

So the great opportunity for us to grow SaaS revenue is the way GeM revenue grew first two years it was slow. Third year, fourth year start growing. Similarly, Magic Submission is one area where we are expecting this revenue. Today, the US has close to 200 million policy submission every year. And we are able to price our submissions between $10 million to $20 million submission and having a $5 million policy, close to $50 million to $100 million SaaS business around it.

Similarly, there is Magic Invoice business, which is accounts payable business, where the similar kind of equation is there that per invoice processing, where multiple companies have come, Rawsome [Phonetic], and many companies have come in that space. So this is the second space in SaaS, which you’re looking at.

Third space in SaaS, we are looking at ESG. ESG to be offered as a service with a complete ESG wheel available to it, which is a third SaaS service. Fourth SaaS service is hosting a core banking, hosting iKredit360 in the fourth — the fourth and fifth service in SaaS business. So these are the five services which are there, Then we are looking at bank [Phonetic] to be hosted, virtual accounts management, embedded finance to be hosted. So these are the multiple platforms, which is being highlighted in this presentation.

So there are close to 8 platforms where we have a clear go-to-market strategy, but the traction will not be quarter-on-quarter. Traction will be over the three year period. So we have a plan which is a 3-year plan and two quarter visualization or planning. So we are working on a 3-year horizon with 2 quarter focus on ensuring that we are able to meet the numbers as well as the visualization of 3 years. So that’s a long answer to your short question on what is the SaaS strategy which we have.

And US. Banking industry is in turmoil, but these turmoils do happen. This is, as I mentioned, Brexit happened, three quarters delay happened, Ukraine happened. We have two deals lost similarly in the US. This crisis happened. We lost two deals again over here. Now the things which will happen as a part of our journey. But after 2, 3 quarters, it comes back to the same thing because technology needs cannot go away, either from bank nor from insurance company.

Anil Sarin — Centrum — Analyst

Okay, I just had one follow-up question, that in the earlier calls, I think Rajesh had mentioned that in core banking, you were in the last three in a couple of tenders, which tend to be over more than a year-long process. So if you can provide an update as to where we are those tenures are those processes still on? And if yes, where are we in that?

Arun Jain — Chairman & Managing Director

Rajesh?

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

Yes. So I think we continue to be in the same process. So I think, as I had mentioned earlier, there are a large couple of deals that we are in the final stages. And please, in the next couple of quarters, we should be able to announce the results of these tenders. So I think to answer your specific question, we continue to be in the process. And actually, we’ve added a couple more in these — from that perspective, and we should have the results in the next couple of quarters.

Anil Sarin — Centrum — Analyst

And we are still in the top 3? Or is it being further pruned down to maybe top 2 or something like that?

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

In couple of deals, I think we are still in top 3. In one deal, we are now in top 2. So I think deal by deal, this varies, but we continue to be there. As I said, we continue to face those 3 — Europe and the large field continues to become a Temenos, Thought Machine and Intellect fight.

Anil Sarin — Centrum — Analyst

Okay, thank you and wish you all the best in this — in these bids. Thank you.

Praveen Malik — Vice President, Investor Relations

Thanks Anilji. Next, we have Sugandhi Sud from InCred. Please unmute her. Sugandhi? Sugandhi, you are there?

Sugandhi Sud — InCred Asset Management — Analyst

Hi, yes, hi. Congratulations on the good results and thanks for taking my questions. So I just wanted to just continue from the point where the last speaker left. I noticed that in your conversion for last quarter, you have — among your Destiny deals, you have 1, 3 deals greater than INR50 crore bucket. And I’m just doing simple math, I understand, is it down to the tenure of these deals? Could you give some flavor of the tenure or the nature, whether it’s SaaS or legacy or license, traditional license? And whether this will flow through in coming quarters? And what kind of time frame we’re looking at?

Arun Jain — Chairman & Managing Director

Sugandhi, I think you are doing too much of a math analytical mind on looking at it, what — when it will happen. I think I mentioned that all of it is license-linked, is more important than they are INR50 crore deals. In this quarter, these Destiny deals, which have signed up, I think, two are license, one is more on SaaS revenue. But it will not — you will not able to forecast that particular model so much, Sugandhi. I think more important is to just listen to the presentation, which three leaders have presented and look at what is the potential of these presentations for next 3 year perspective, whether they can grow 20% year-on-year under those presentations. So that will give you the much better way to forecast.

Sugandhi Sud — InCred Asset Management — Analyst

Sure. Of course. That’s very insightful. And also just on the — if I noted it correctly, you said that your intensity of spending on platforms will lower hereon. Most of the platform spend has taken last year. And I’m just referring to the cash conversion that was highlighted earlier in the call. So is that correct? Because there is a CapEx intensity had gone up last year. So is it expected to go down from here?

Arun Jain — Chairman & Managing Director

That’s right. So this quarter, our profit has come back to 23%. EBITDA margin come to 23% from 18% last quarter. So that improvement is happening there. On cash side, improvement will happen this quarter, we have more cash to be spent for payout of the bonus for the year quarter. But for the whole year, we should have a healthy cash generation.

Sugandhi Sud — InCred Asset Management — Analyst

Got it. So any margin range that you would point us towards considering that you are kind of stabilizing and your growth outlook is also healthy?

Arun Jain — Chairman & Managing Director

We mentioned our business is designed on the principles of 20% growth, 25% to 30% margin levels. Few quarters, a few months, we will be reinvesting back. That we base on how the market behaves, what the technology change is happening. But our design is always around 25% plus for the margin, but few quarters, we’ll have a lesser margin when the investments will be higher or some license is not signed or some investments we are doing with the clients. So that shift will be there. So that’s how we have designed the business.

Sugandhi Sud — InCred Asset Management — Analyst

Sure, sir. Very encouraging. One final question. Sir, is my understanding correct with SaaS becoming a bigger mix, and we’ve seen that happening on the last 2 years, the revenue to cash conversion, and I’m talking about the working capital here and not the investment that we do in our R&D. Is that something that should improve because the recognition, the gap between the timing of recognition of revenues and payments would be more aligned in a SaaS environment compared to a license environment?

Is that something that we can expect going forward, a higher cash conversion as SaaS becomes part of the plan?

Arun Jain — Chairman & Managing Director

As of now, SaaS model is not fully mature. So I would not say anything, as of now. We are — some deals we have upfront payment, some deals we have back-ended payment on a milestone basis. So the cash flow and working capital, I think that’s not a serious concern. Company has a healthy cash. So that’s not such a critical issue for us right now.

My purpose is how much we can win and how much could be repeatable SaaS. SaaS is a healthy situation, in a mature model gives you a 70% plus margin. That’s kind of health of the SaaS business, but that takes almost 4 to 5 years of the work which happens after we are getting it, first few client, like Banesh was saying the 13 client Magic Submission, there are 7 clients in Magic Invoice. These clients take some 4 to 5 years to get stabilized.

Sugandhi Sud — InCred Asset Management — Analyst

Thank you, sir. That’s very helpful.

Praveen Malik — Vice President, Investor Relations

Okay, thanks Sugandhi. Next, we have Mr. Majid Khan from CapitalX. Mr. Majid Khan from CapitalX. Please unmute him. Mr. Majid Khan? Right. Good evening everybody. Thank you for giving the opportunity. This is the first time I’m joining the conference call. And first of all, I would like to commend your [indecipherable] for giving this opportunity and very good set of numbers. So I would like to ask my simple question with regards to the results of quarter 4. Sir, my question would should be, where you can see in the 3 years Intellect? And my second question will be, I would like to congratulate all the team that — I have seen all the IT companies in the sector, but Intellect is the only product company which I’m proud investor of it. And since 3 years, I’ve been continuously invested in the company and I have seen a drawdown of 50%, but still I have a trust on our company because we are a unique company in the whole India, which has a product. And we are the leader in all the sectors, in all our business platforms. And that’s the very thing which definitely soon the market will realize. And I hope and I believe. Thank you very much, sir.

Arun Jain — Chairman & Managing Director

Yes, thank you for your trusting the company, I think. And there is a huge scope is there. We wanted to show that how the revenue growth will happen. Each of the spaces that we are working on we are competing on the companies which have to invest $100 million to create a platform called, let’s say, Magic Invoice equivalent platform. Our cost of leveraging fabric to meet the same expectation is one-tenth of it. It is between $5 million to $10 million. We are able to generate a quality of the technology, which a corresponding company like Thought Machine invested $550 million of core banking, which is still not complete.

For us to do that job, it takes much, much lower money from our perspective. And that’s a very unique company. That’s a unique strategy. That’s the kind of the people we have, the kind of the committed team we have, is amazingly satisfying for all of us as a shareholder. And all of us as an associate of the company.

Majid Khan — CapitalX — Analyst

Thank you very much, sir. Thank you.

Praveen Malik — Vice President, Investor Relations

Thank you, Majid. Next, we have Mr. Rahul Jain from Dolat Capital. Rahul? Rahul are you there?

Rahul Jain — Dolat Capital — Analyst

Yeah, can you hear me?

Arun Jain — Chairman & Managing Director

Yeah, yeah. Please go ahead.

Rahul Jain — Dolat Capital — Analyst

Yes. So first of all, congratulation on strong numbers. And I just want to — need some more input on some of the comments that were made during the call. I mean, of course, you said that what is your view on the US banking issue that we are facing right now. But you also need to consider the fact that we analysts do attend so many IT services call and they keep talking about a delay in ramp-up, delaying in decision making.

So since you have also done that kind of a business, any thoughts you want to share that in such situation, do you see that people prefer more transformation because they see that as a solution? Or you think it’s just a matter of time that we may see better decision-making on the other side of the business also? First clarity on that would be helpful. And then I have one more question.

Arun Jain — Chairman & Managing Director

Yeah. First of all, our business is very well diversified. US exposure to us is much lower than Canada. We have more businesses in Canada than US. US banking business is very small in single digits, while insurance business is growing in US and kind of single digit. But single-digit is only exposure, which we have in US So US is not impacting us significantly for the slowdown.

But to answer a general question since you attend other services conferences, obviously, such the failure of three banks in a row will have an impact on the psychology of the technology investments, which will go in the board rooms. So every board room will be worried about it. But do they have an option to adopt a BankTech Wave 5? They don’t have an option. It’s a question of some delay, one or two quarter delay, where they have to choose some platform or some technology for transformation. And there, we are providing kind of a technology, which is do-it-yourself technology, eMACH.ai, where we are pitting in our value proposition more sharply for those banks who are well-capitalized banks are there.

So those banks are still looking, because these banks who have been — the problem which has happened, they are getting merged in a larger bank. The portfolios are getting merged. So to me, it’s a two quarter, three quarter agenda where slowdown will happen. Services will get impacted because banks are looking for the option where buy and build can be together.

Rahul Jain — Dolat Capital — Analyst

Right. Thank you. And one more question regarding the comment about that, what Rajesh said that incrementally, banks are looking for core transformation project. So are you seeing a sizable increase in the deal that you are pursuing? That is point one, Secondly, you said that there was a competition, which is now limited to two relevant player. And we know that Temenos is struggling with a lot of leadership changes and Thought Machine is there, but their return on investment may not be as attractive. So the competitiveness on price could be far better. So how you see a change in the landscape from a competitive perspective as well as from a deal size perspective?

Arun Jain — Chairman & Managing Director

Rajesh?

Rajesh Saxena — Chief Executive Officer, Retail & Central Banking

So I think to answer your question, I think — and these are some early trends, is that we are definitely seeing large banks coming in for core banking transformation. And that’s definitely something that we have seen in the last 18 to 24 months is the market opportunity around large banks, large regional banks coming for a composable eMACH type of an architecture. That trend is definitely accelerated.

I think to your second question, yes, we see Temenos, we see Thought Machine in most of these opportunities are, let’s say, that we start with a long list, and then we come to these three players. We are seeing that space and we believe — and I believe that we are uniquely positioned because of the kind of investments that we have done in the last couple of quarters on our architecture front and with a pedigree of the depth and the breadth that we have. We are uniquely positioned to capture this space. So that is my belief, and that’s what our team is striving for.

Rahul Jain — Dolat Capital — Analyst

Right. And just one final question to Arunji. I think we have a lot of variety of offering in the Banesh portfolio, which are very exciting opportunity. Any number you want to give then when they can become of some reckoning size, let’s say, $100 million or any other benchmark you want to set for it and timeline that you think it can achieve it?

And secondly, you said about the business, which is all set to deliver 20% growth and 25%, 30% kind of a margin. With the kind of a pipeline you have, the kind of start to have for this year, you think — and the kind of investment, of course, you envisage for this year, do you think we are going in that zone in fiscal ’24?

Arun Jain — Chairman & Managing Director

Yes. So we don’t want to give guidance Rahul. We are understanding because market is volatile. So guidance is not there. We keep repeating. We designed the business in the last 3 years we are able to show more than 20% business. Our design model is 20%. So we stayed with that. The opportunity for Banesh business to grow the 3 or 4 areas, which is their Sherlock, ESG Edge, we still are the early stages of looking at it. The potential can be between $50 million to $100 million in the next 5 years, but they will be coming at a margin of $13 million, 60% margin or 70% margin business. So it will be highly value accretive on the bottom line perspective. But we need to give some time.

Rahul Jain — Dolat Capital — Analyst

Interesting. Thank you for that color, and best of luck for the year ahead.

Arun Jain — Chairman & Managing Director

Thank you, Rahul.

Praveen Malik — Vice President, Investor Relations

Thanks Rahul. Next we have Mr. Chirag from Ashika Group. Chirag? Chirag, from Ashika Group?

Chirag — Ashika Group — Analyst

Am I audible?

Arun Jain — Chairman & Managing Director

Yeah, you are audible.

Chirag — Ashika Group — Analyst

Congratulations on great execution in challenging time, sir. And I track your company since last couple of quarters. So I have 2 broader questions, particularly in [indecipherable] and platform business, very few companies have got success at global front also? And in India, very few companies are there, which have done a good job. So your company is one of them. So other than BFSI from a diversification point of view, if I want to know what are the areas where our application will find place later on? Because this last three regional bank crisis, you’re also thinking some way that if we have some diversification then definitely in future, let’s say, this time we save ourselves, but let’s say, some other unforeseen development happen later part of the year or in future, so any thoughts on that where we see for diversification?

And also to sustain such kind of margin, what are the levers are there that 5 years or 10 down the line, we’ll have a similar margin profile? That’s two broad question I have.

Arun Jain — Chairman & Managing Director

Yes. So Chirag, first of all, 5 years down the line, margins should be in the range of 40%. Because if you’re looking at it from the perspective of FLEXCUBE numbers, EMC continuously grow. So margin improves as the product company growth. So first of all, that’s a 5 to 10 year type of horizon when you’re looking at it. And you’re looking for the investment of 5 to 10 years, you have appetite for that. The margin is at 40% levels, whether it’s the Temenos or any company.

The beauty of what we have done is we embed the growth curve of those margins and our IT team and technology teams are very differentiated, which is ensuring the growth happens. Margin is not a big deal in a product business because once the customer signs it up, it remains with the customer for the next 15, 20 years. The margin maintenance is a much simpler job. Growth is a key important part.

Your question is whether we want to diversify out of financial industry? I don’t think so. I think market scope today when you look at it, but Manish puts it $10 billion market size, which Rajesh would say, $20 billion market size, Banesh would say — so we have a $50 billion market size. And we are still $300 million kind of ballpark picture. Till the time we are $1 billion, we are not looking for anything to be worried about going left right and center.

Chirag — Ashika Group — Analyst

Okay. Sir, one follow-up question. In terms of geographic diversification, is there any plan to increase or start penetration in India because one of our peer in listed space getting good business from Indian bank and financial group. Your thoughts on the same?

Arun Jain — Chairman & Managing Director

Yes, yes. Yes, deeply entrenched in India. Lot of deals are in India now.

Chirag — Ashika Group — Analyst

Thank you. All the very best.

Arun Jain — Chairman & Managing Director

Thank you.

Praveen Malik — Vice President, Investor Relations

Thank you Chirag. Next, we have Mr. Ravi Mehta from Deep Financial. Ravi? Ravi you are there?

Ravi Mehta — Deep Financial — Analyst

Yeah.

Praveen Malik — Vice President, Investor Relations

Ravi?

Ravi Mehta — Deep Financial — Analyst

Can you hear?

Praveen Malik — Vice President, Investor Relations

Can you be a little louder?

Ravi Mehta — Deep Financial — Analyst

One second.

Praveen Malik — Vice President, Investor Relations

Hello, Ravi? Ravi, are you able to hear me? Ravi is not able to connect, it looks like.

Ravi Mehta — Deep Financial — Analyst

Is it better now?

Praveen Malik — Vice President, Investor Relations

Yeah, yeah, now it’s fine. Please go ahead.

Ravi Mehta — Deep Financial — Analyst

Sorry for that. So just I heard in the opening remarks regarding some branding strategy for the iGCB vertical, something similar to what we did with iGBT on the Oxford School banking kind of course. So I wanted to know what kind of activity are we planning and how it can catapult the product and the visibility?

Arun Jain — Chairman & Managing Director

It’s the overall marketing strategy. I think all of it will not be shared in an investor call. It’s one part of the strategy, where iGBT Oxford will give it. So the indication is given there’s a big marketing focus on getting into the stage. And I think it’s not a right platform to share the strategy.

Ravi Mehta — Deep Financial — Analyst

Sure, sure. And probably any — so the kind of traction you’ve seen in iGTB, probably with this branding activity, I think it really picked up well. So we can expect something similar kind of a thing happening here also?

Arun Jain — Chairman & Managing Director

Obviously, all of 3 brands now, are solid into 3 LOB [Phonetic] and all the 3 brands into intellectAI, GCB and GTB are now having a very, very structured branding methodology around eMACH.ai as a common brand, which is driving the global access.

Ravi Mehta — Deep Financial — Analyst

Okay. And since that, we are harping on this eMACH.ai platform. So do we have any joint go-to-market strategy with the cloud partners?

Arun Jain — Chairman & Managing Director

Yes, yes. We have. That’s what Manish has highlighted if you noticed, Microsoft and AWS. Both are — we are very close working with it. So some products are working on AWS, some products are working on Microsoft. So both of them, we have a very strong relationship. I met the President of AWS when he was in India. It’s a deep relationship with both of them.

Ravi Mehta — Deep Financial — Analyst

Okay. Okay. And just one more question. And one small bookkeeping question, if I can ask the DSO days mentioned in the presentation, includes the unbilled revenue?

Arun Jain — Chairman & Managing Director

Yes. Yes.

Ravi Mehta — Deep Financial — Analyst

Okay. Some how I don’t know. So maybe I will take it offline, because the days are not tallying with what we work it out. So that’s why. Sure, sir.

Arun Jain — Chairman & Managing Director

[Indecipherable] Is that contracted now due may not be there part of it.

Ravi Mehta — Deep Financial — Analyst

Okay, thank you and good luck.

Arun Jain — Chairman & Managing Director

We don’t include contracted but not due. Thanks.

Praveen Malik — Vice President, Investor Relations

Thanks Ravi.

Ravi Mehta — Deep Financial — Analyst

Thank you.

Praveen Malik — Vice President, Investor Relations

Thank you. Next we have Mr. Harshit from AUM Advisors. Harshit? Maybe last 2 questions Arun.

Arun Jain — Chairman & Managing Director

That’s right.

Praveen Malik — Vice President, Investor Relations

Yeah. Harshit? Harshit, are you there?

Harshil Shethia — AUM Advisors — Analyst

I am audible?

Praveen Malik — Vice President, Investor Relations

Yeah, Harshit. Your line is live.

Harshil Shethia — AUM Advisors — Analyst

When we see on a quarter-on-quarter basis, the order funnel size that you mentioned in the presentation, has been around INR7,000 crores in the last 3 quarters. So is it something like the new deal wins have been very slow for the last 3 quarters?

Arun Jain — Chairman & Managing Director

INR7,000 crore quarter funnel, I think, is a good funnel for us to look at the 10 to 12 deals a quarter, if we win, it’s right funnel. So we prefer more the right funnel than the quantum of the funnel. So our win ratios are higher. And our sales effort and e-sale effort as Rajesh mentioned, it takes 1.5 years to close the deal. We don’t want to increase the funnel size. So it’s not a consumer business where a funnel is directly proportional to the enterprise sale. INR7,000 crores is a good number on which we are working.

Harshil Shethia — AUM Advisors — Analyst

And can you break up the whole funnel in terms of how much would be SaaS in it?

Arun Jain — Chairman & Managing Director

We don’t do it.

Harshil Shethia — AUM Advisors — Analyst

Okay. Thank you.

Arun Jain — Chairman & Managing Director

Thank you.

Praveen Malik — Vice President, Investor Relations

Okay, thanks Harshit. Next we have Mr. Vivek Kumar from Des Powers [Phonetic]. Vivek?

Vivek Kumar — — Analyst

Hello?

Praveen Malik — Vice President, Investor Relations

Yeah, Vivek. Please go ahead.

Vivek Kumar — — Analyst

Thanks Arunji. See, you’ve been highlighting this is regarding the revenue recognition policy. This is — you’re doing percentage of completion method, and you also have been highlighting every concall about the execution capital, how you have disrupted in Q4 ’22, you have — Prabalji and you mentioned how you have put down the work into 4 hour or 2 hour work packet and very few defects in our implementation.

So why I’m asking is there are a few companies which follow the same method, but because of the implementation problems they had to write off certain kind of revenue. That is where the doubt is coming. It’s not about how much is billed or unbilled. But if you can give more color on why you think whatever is recognized the write-off would be really less than we don’t — even with kind of customers we are having and the execution capital that you’ve built will make sure that we will not have a huge write-off? So maybe I’m — I don’t know. I think I’ve made it clear right.

Arun Jain — Chairman & Managing Director

And that’s a very good question you have asked. I think we have implemented 43 digital transformation last year. I think this is our core pride, why we are winning the business, why we have — Manish is so confident on NPS score. This is a core focus, Manish has driven, Rajesh has driven, Banesh has driven that none of the projects of Intellect go bad. My competition when it goes bad, it becomes difficult to do it. We chose on a strategy to implement ourselves, not to give partners till the time eMACH.ai has come in. Because of that strategy, that we cannot allow any failure on the field because this is a business which is execution-focused business. We need to have — we need to design our success for our customers.

And that’s where the core value of Intellect is there. And that’s what we discuss about work packet today. Now we iTurmeric where we are seeing our coding requirement will be less than 5%. With that it will further improve the delivery quality.

Vivek Kumar — — Analyst

No, this is coming because percentage of completion has this risk that implementation is not great, you will have write-off so. I think the second question is on intellectAI, you have mentioned in the last concall that you were looking at 15 deals. And with this banking crisis, I don’t know what is happening in US, so much so any clue on the 15 deals we are still there, how they can — be able to close them? Or what is the outlook on that? I’m not asking the number of deals, but outlook on the intellectAI Insurance business in US? Because you told last year, it will grow at 50%.

Arun Jain — Chairman & Managing Director

Insurance business is growing at that much, Banesh. I think it’s growing.

Banesh Prabhu — Chief Executive Officer, Intellect AI

Yes, I think a pipeline, and as a matter of fact, as I mentioned in my discussion, we have very deep contracting discussions in progress with several. So I can just leave it at that.

Arun Jain — Chairman & Managing Director

Thanks, Arunji. Thank you very much.

Praveen Malik — Vice President, Investor Relations

Arun, there are 3 more questions actually left. Can we take them?

Arun Jain — Chairman & Managing Director

Yes, just on a chat box just combine it otherwise, just take it up here.

Praveen Malik — Vice President, Investor Relations

Okay. Next, we have Jagdishji, Jagdish, you’re there? Jagdish?

Jagdish — — Analyst

Yeah, hello. Are you able to hear me?

Praveen Malik — Vice President, Investor Relations

Yeah, Jagdish.

Jagdish — — Analyst

Yeah, so thanks for good set of numbers. I’m following for the last few years. So this — on the part, right, you just explained about GSA, right? So we are implementing the solution ourselves and we recently partner with Accenture. So what is our future for this GSA collaboration? So I could see Finastra is collaborating with a few service providers in India. So they are increasing. So other companies are also collaborating. So not now, maybe in the future, how we are a collaborative strategy with the GSA, it is the first question?

Arun Jain — Chairman & Managing Director

Yes. This is Jagdish about eMACH.ai.

Jagdish — — Analyst

I mean in general sense.

Arun Jain — Chairman & Managing Director

Yeah. Because of that eMACH.ai, we are creating an open finance platform and because of which we can now offer more partners to come in, GSA partner to come in to have a predictable output. Earlier, we were not giving it to the partners is because we wanted a predictable outcome. Now with the technology we built, we can give it to the companies.

Jagdish — — Analyst

And just regarding the partnership with IBM, any update sir, on that part?

Arun Jain — Chairman & Managing Director

Yes, it’s going on very well strongly. We have multiple deals with IBM also. The way Accenture is there. IBM is also there.

Jagdish — — Analyst

Yeah. That’s it from my side. Thanks a lot for good set of numbers.

Praveen Malik — Vice President, Investor Relations

Thanks Jagdish. Next, we have Mr. Anubhav Makkar from Rakar Investment. Anubhav, are you there. Looks like Anubhav is not there. Then we have just one question. This is Darshil Jhaveri from Crown Capital. Darshil, please ask your question?

Darshil Jhaveri — Crown Capital — Analyst

Hello, sir. Thank you so much for taking my questions. And firstly wanted to congratulate on great set of results. And thank you so much for giving us so much time. So I just wanted to — I had some connectivity issues, I missed some of your statement, sorry for it being repetitive. I just wanted to ask whether our revenue panning out, our sustainability in terms of revenue and margin growth for [indecipherable] basis? Sorry if it’s a repeated question.

Arun Jain — Chairman & Managing Director

Yeah, the entire last words, I wanted to say that we can do a gross margin why should we grow, how the margins have grown and what is the growth assurance we are seeing because of the portfolio and other risks. So I think, I don’t have to repeat what I’ve been discussed in the last two hours. So if you listen to the recording, you’ll find your answers.

Darshil Jhaveri — Crown Capital — Analyst

Okay. Thank you so much, sir. Thank you so much.

Praveen Malik — Vice President, Investor Relations

Thank you, Sir. Arun, that is–. So we are closing the call. Thank you very much for participating. In case any follow-up questions are there please write to us or call us. Thank you very much. Now you can log out.