Ksolves India Limited (NSE: KSOLVES) Q3 2025 Earnings Call dated Jan. 21, 2025
Corporate Participants:
Vinay Pandit — Investor Relations
Ratan Kumar Srivastava — Chairman and Managing Director
Umang Soni — Chief Financial Officer
Manish Gurnani — Chief Technology Officer
Analysts:
Unidentified Participant
Presentation:
Vinay Pandit — Investor Relations
Ladies and gentlemen, I welcome you all to the Q3 and 9 months FY ’25 Post Earnings Conference Call of Ksolves India Limited. Today on the call from the management team we have with us Mr. Ratan Srivastava, Chairman and Managing Director; Mr. Manish Gurnani, Chief Technology Officer; and Mr. Umang Soni, Chief Financial Officer.
As a disclaimer, I would like to inform all of you that this call may contain forward looking statements which may involve risk and uncertainties. [Operator Instructions]
I would now request the management to quickly run us through the investor presentation for the quarter that went by giving us the business and performance highlight for the quarter and nine months ended December 2024, their growth plans and vision for the coming year. Post which we will open the floor for Q&A.
Over to the management team.
Ratan Kumar Srivastava — Chairman and Managing Director
Thank you, Vinith ji. Thank you. Good afternoon everyone. Today we are here to present our investor presentation for quarter three 2025. I will hand over this call to Umang who is our CFO. He will go through PPT, he and Manish, and then I will come back again for the question-answer round. Over to you Manish — Umang.
Umang Soni — Chief Financial Officer
Thank you and good day everyone and a very warm welcome. We appreciate you all taking the time to join us for quarter three and nine months FY ’25 earnings call. So let me now take you to through our quarterly updates. So Ksolves continues to excel as a global IT solutions provider with 12 years of expertise. Our team of talented 539 professionals serves 150 plus clients across 30 plus countries. We continue to maintain a strong international focus with 77% of our revenue coming from the overseas markets. North America remains our largest overseas market followed by Europe, Australia and rest of the world. And domestic business contributes 23% of our total revenue. And as a testament to our clients trust, over 80% of our revenue comes from repeat customers. And during first nine months of FY ’25 our top five clients contributed 39% of our total revenue while top 10 clients accounted for 52%.
Next. Okay, so we also maintained strong synergies with the leading tech partners including Adobe Braun Solution Partner, Redhead Business Partner, AWS Partner, Odoo Gold Partner and Salesforce Summit Partner. This partnership strengthen our capabilities and credibility. Also this quarter marks a significant achievement as we have surpassed INR100 crores in revenue during first nine months of FY ’25 matching our full revenue full year revenue of FY ’24. And along with that we have also maintained a remarkable 30% plus year on year revenue growth over 15 consecutive quarters since listing which demonstrates our robust growth trajectory and a strong foundation.
And now so our key financial updates during the quarter to align our key management with long term goals of the company, we have granted 60,000 stock options representing 0.5% of our current outstanding share capital as a part of our 2.5% ESOP pull and additionally the board has approved one is to two stock split subject to shareholders approval to enhance the liquidity of the share.
Now quickly let me run you through our financial performance in the next slide. We have achieved impressive year-on-year growth during the quarter Revenue we have achieved 33% year on year growth. PAT we delivered a 15% year on year increase. EBITDA we have registered 17% year on year growth ESOP adjusted EBITDA. Because this was the first quarter we have recognized ESOP expenses, so if we account for that then our EBITDA has showed a 20% year on year growth and EPS we recorded a 15% year on year growth.
So now our consolidated quarter three revenue is stood at INR37.70 crores reflecting a 8.3% sequential growth and PAT increased to INR10.32 crores during the quarter which demonstrated a sequential growth of 12%. Our EBITDA margins were 37.3% with adjusted margins at 38.3% which are ESOP adjusted and EPS for the quarter stood at INR8.70 per share, highlighting our strong business model.
Okay now so let’s take a look at this graph. This indicates our quarterly performance. I would say the exceptional growth over the past three years that we have shown. So we have achieved consistent quarter on quarter growth in both revenue and profitability during this period. And notably since our listing there has been no decline in quarter on quarter revenue growth so which again underscores our unwavering commitment to sustained growth and long term value creation.
Diverse Offerings from technology perspective, our portfolio continues to deliver value across range of cutting edge technologies. AIML now contributes over 12% of our total revenue while Salesforce, Big Data and Odoo each lead the way generating more than 20% of our revenue. Additionally, open source technologies represents around 18%. And major thing which celebrated two major wins this quarter, a key deal with a cyber security company providing solutions to Fortune 1000 company and a significant Salesforce engagement with a prominent UAE based conglomerate. So these key wins helps in increasing our valuable client profile and increase in the Ksolves — increase trust in the Ksolves as a brand.
So our diverse offerings in technology helps us or enable us to serve multiple niche and complex technologies which help us to cater a broad spectrum of sectors ensuring a diverse industry mix. So the telecom sector remains our largest segment, closely followed by technology and service industries. Additionally we serve key sectors such as retail,marketing and advertising, manufacturing, edutech, bfsi, real estate and healthcare. So this diverse portfolio highlights our capability to deliver solutions across emerging and established industries worldwide.
Also we strive to acquire new customers and strengthen relationship with our existing ones by delivering exceptional services and introducing innovative solutions including advancements in evolving areas like generative AI. Also our esteemed clientele includes 11 clients with revenues exceeding USD1 billion and five clients with revenues between USD200 million to USD1 billion so they contribute respectively 25% and 7% to our total revenue. Also again this profile and these numbers again demonstrates the strength and quality of our client base. Also we have consistently emphasized on our commitment to delivering value to the shareholders through strong dividend payouts and corporate actions that enhance the liquidity and shareholder value such as bonuses, stock splits and other initiatives.
Now quick business snapshot. So we have participated in prestigious events such as Global AI summit in Dubai and a workshop in USA. This aim to position Ksolves as a global brand and enhance the visibility of our capabilities in complex and high end technologies. Also in the recent quarter we were privileged to receive the Deloitte India Technology FAST Award 2024. We have also established a strategic partnership with leading player in the broadcast and media technology domain. And our commitment to future growth is reflected in our investment made in our key senior leadership roles which includes Director of Program and Operations, Marketing Head and Head of Business Transformation and Consulting. These positions will strengthen our leadership team and strategically position us to capitalize on emerging opportunities and drive our long term success. So all in all these key updates encapsulate the highlights of the quarter, our financial results and our commitment to operational excellence, strategic growth initiatives and sustainable value creation over the long term.
So now I will hand the call over to Mr. Manish who will provide us further insights into our technological capabilities. Thank you everyone for your continued support and interest in Ksolves.
Manish Gurnani — Chief Technology Officer
All right, thank you. Thank you, Umang. And again welcome everyone. So Umang took us through the financial performance. I’ll talk about growth technology and what is the future that we are looking for Ksolves. Okay so our key strategic element, these are the key pillars based on which we have our vision focused. So number one is digital transformation. Second is powering intelligence through AI. Now AI is being used everywhere and we are very strongly focused on building solutions and services — products and services, leveraging AI as well as GenAI. Then we are also started forming strategy alliances. So we have partnered with couple of, you know, big names in terms of technology and we are building up capabilities on their portfolios. Obviously financial probability, it’s it forms the base for all of our projects and then especially empowering our K team essentially means that we are giving opportunities to our employees to enhance their skills and upgrade themselves — upskill themselves onto the latest and the greatest technologies. These are the growth drivers.
Number one is increased utilization. Our utilization has always been consistent beating industry standards. We have like earlier mentioned, right we have entered into tech partnerships with many, you know, big names. For example we are, you know today I can say that we are working with Red Hat, we are working with you know, Oracle, we have started working with uh, you know, similar uh, big names. Uh, and when I say big names it’s like we have formed partnerships which allows them access to their portfolio of latest products. Then smart investment. We have been building, you know, onshore presence recently we all also opened a new office in Dubai. And then lastly, but not the least the client relationship.
So we have a great success as well as retention rate with all of our clients. We our seeds at scores. The customer scores have always been, you know the, they have always been good. Okay so this is a special slide that we wanted to focus and you know, sort of share with you all what Ksolves has been doing in terms of AI and GenAI. So we have been, it’s been almost now, you know, almost 18 months that we have been very strongly focused on GenAI. Today AI being used. So these, you know, so we have four products across which we have been using AI. Number one, Dashboard Ninja with AI, it’s a Oddoo, it’s an ERP based product in which we have integrated now AI capabilities to generate dashboards automatically which, which has made the use of this product very, very even more simpler. Just to let you know, this has been one of our major, major selling products on the Odoo App Store for almost five years.
We are the number one app dashboard engine has the number one app on the Odoo App Store and now we have added AI capabilities to that app which has helped us get even more clients and even more sort of, you know, features into that product. The second product, dfm, we have a separate slide also for that. But DFM is again a very unique solution which is being developed by KSolves. It’s a big data product which helps in building heavy database data pipelines very simply, very easily using a, you know, a very nice ui. Without DFM it would have taken the customers a lot more time and a lot more complexity. With DFM we have been able to bridge that gap.
Third element, it’s a salesforce based product which allows you to manage your lead, the marketing leads very efficiently and very easily. It also has capabilities now based on AI for lead scoring, for built in analytics. Consistent beating industry standards. We have like earlier mentioned, right we have entered into tech partnerships with many, you know, big names. For example we are, you know today I can say that we are working with Red Hat, we are working with you know, Oracle, we have started working with uh, you know, similar uh, big names. Uh, and when I say big names it’s like we have formed partnerships which allows them access to their portfolio of latest products. Then smart investment. We have been building, you know, onshore presence recently we all also opened a new office in Dubai. And then lastly, but not the least the client relationship.
So we have a great success as well as retention rate with all of our clients. We our seeds at scores. The customer scores have always been, you know the, they have always been good. Okay so this is a special slide that we wanted to focus and you know, sort of share with you all what case hall has been doing in terms of AI and Geni. So we have been, it’s been almost now, you know, almost 18 months that we have been very strongly focused on gen AI. Today AI being used. So these, you know, so we have four products across which we have been using AI. Number one, Dashboard Ninja with AI, it’s a udo, it’s an ERP based product in which we have integrated now AI capabilities to generate dashboards automatically which, which has made the use of this product very, very even more simpler. Just to let you know, this has been one of our major, major selling products on the Odoo App Store for almost five years. We are the number one app dashboard engine has the number one app on the Odoo App Store and now we have added AI capabilities to that app which has helped us get even more clients and even more sort of, you know, features into that product.
The second product, dfm, we have a separate slide also for that. But DFM is again a very unique solution which is being developed by Ksolves. It’s a big data product which helps in building heavy database data pipelines very simply, very easily using a, you know, a very nice ui. Without DFM it would have taken the customers a lot more time and a lot more complexity. With DFM we have been able to bridge that gap. Third element, it’s a salesforce based product which allows you to manage your lead, the marketing leads very efficiently and very easily. It also has capabilities now based on AI for lead scoring, for built in analytics.
For workflow automation. Customers have been showing great interest into this also. And then my Myindi is a JI based platform that case halls have developed internally. This allows any enterprise to leverage and search through their entire knowledge base. Any, the entire enterprise knowledge base can be assimilated into this and it can be then used and searched by and any person at the same time. So this is for the products and the services that we have been doing. But at the same time we have also been using GenAi and AI based solutions for our own efficiencies, our own let’s say programming efficiencies.
So we have been, we have been using you know, sort of gen AI to see how can we make our deliveries our you know, our time to develop our software more efficiently and reduce the overall budget as well as the overall estimate so that we become more competitive compared to our competitors. So the future, the technology roadmap that we are seeing for the coming, coming year at least. So we are, we have our portfolio today includes services as well as product services. We are focused Primarily on to AIML, big data, Salesforce and then there is DevOps and the, you know, the digital transformation. On the product side we have four major lines of products. One is Salesforce products, one is UDO products. Then the new products that we have developed this year, one is Data Flow Manager and the other Mind AI Ninja. These are also covered in details in the next slides at the same time. So we also realize that we need to keep upgrading and adding new technologies to our portfolio.
So these are some of the new technologies that Kols now can say has expertise on. And we have active, you know, developers as well as projects going on these technologies. So this, these are some of you know the products that I mentioned earlier. So the left, left box show the UDO products. Then we have sales for product and the bottom, I like to focus on the bottom to the Data Flow Manager and the Mind AI Ninja. These are the two in house developed products by K Salts. Data Flow Manager is a big data project product which allows you to, which allows any customer who’s using Apache nifi. Now Apache is an open source technology but it does not come with you know, lot of enterprise grade features. So we have built those capabilities in house using Data Flow Manager. The second product, the Mind AI Ninja, it’s a gen based platform. This platform allows any enterprise to sort of assimilate all the knowledge base, all the documents, all the anything that they have on which they want to then you know, build solutions. So using Mind AI Ninja.
Once you, once the organization has ingested their data into mind, AI ninja into this product, into this platform, they then have capability to use a smart assistant, smart chatbot type thing to which can, which can be like a ChatGPT interface for them. And this also has capabilities to integrate with other platforms. So we have provided API layer also on top of this. If there’s some other application, maybe some other, you know, enterprise application that they, that they want to integrate it with, we have capabilities for that also in this.
All right, so you know, some of the case studies, I’ll not go into details but I’ll just, you know, just a brief. Right. So we recently have been working with a very major telecom player. This is in the, you know, Africa region. Africa, Europe region, processing almost 40 billion records every day. 40 billion call data records being processed through a platform. That platform is being managed today by Ksolves. It’s a big data platform, very complex workflows, lot of engineering, lot of design thinking went over there. That platform is being today managed by Case Salts and we have also been able to suggest them new sort of upgrades what, which can make those entire processes more efficient. So it’s a long, long duration project that we have been working with them and this has been, you know, it has been one of the major products for CASE F for big data. We have been doing couple of other projects. So these projects, some of them are on a technology called Apache nifi.
Apache NIFI is the core technology behind which Data Flow Manager has been built. So you can see, however, expertise in technology is helping us build products on top of that technology then we have couple of case studies which we have been doing, you know, for different sectors. So one is into renewable energy, one is into power sector. These case studies can be shared to you if you know, if anybody of you interested. Right. And then obviously like I mentioned, right, machine learning, AI, ML gen, these have been case solves, strong focus since almost two years now. And we have built as you know as, as I just mentioned, right, we have built that gen based platform. We have been working with another major telecom infrastructure player, again a Fortune 500 company for whom we have built a multimodal gen based solution which can take in speech, we can, with which you can sort of, you know, you can show it videos, you can show it images and it can use that also as an input to give you a smart intelligent assistant.
All right, I think that’s it from our side. Over to you Ratan and if there’s any question, we are happy to take that.
Ratan Kumar Srivastava — Chairman and Managing Director
Thank you, Manish. Thank you.
Questions and Answers:
Vinay Pandit
All those who wish to ask a question may use the option of raise hand. In case you are unable to raise hand, just drop a message on the chat window and he’ll invite you to ask a question. We’ll take the first question from Swamil Jain. Swamil, you can go ahead.
Unidentified Participant
Thank you for the opportunity. Congratulations on the great set of numbers. Sir. I want to understand about the Mind AI platform that you’ve built. Does that store the clients or the user’s information in their own, you know, captive manner or is it in probably a server operated by us?
Ratan Kumar Srivastava
Okay, so first of all, whenever we use OpenAI, right? Or we want to develop something our own chat GPT, there are two ways. Either you can use Open AI or you can use your own llama server. And both options are available in this application, mind AI ninja. So let’s talk about the first option. Suppose you are using the open AI, right? So you are integrating open AI API, but you miss. We are using the OpenAI APIs, but we are not storing anything. We are passing information from here to there and there to here. That’s all.
Unidentified Participant
Okay. So the backend models are run on open AI.
Ratan Kumar Srivastava
OpenAI right. Now, big organization, they do not want send their information to Open AI. Okay. They say that they want everything in house. Okay. So in that case we should have capability to develop our own llama model LLM. And then we have that capabilities. And in that case we deploy this llama model to customer premises and all the informations will be with the customer. It is not something that we are storing this. These information means in. In one line, we are not using our own server or we are not storing any information to our server. Everything is…
Unidentified Participant
The latter case, that would look like a more. More like a service offering. You train their, you know, data on models that like how you like it.
Ratan Kumar Srivastava
Yes, yes.
Unidentified Participant
Okay. Okay. And what is the company’s vision with regards to product? What is the current revenue split between services and products? And where do you see that going maybe in the near to medium term?
Ratan Kumar Srivastava
Good question. Thank you. So, however, we have not explained too much about our products. But we have achieved I can say that good success in product. Okay, let’s go one by one. I will — we have four products. Mind, AI Ninja and Element and dfm. And one is. Another one is the Dashboard Ninja. Dashboard Ninja has generated approximately by selling approximately one million in last four years. USD1 million. in the last four years.
Unidentified Participant
In the last four years?
Ratan Kumar Srivastava
Last four years. And it is running number one on the Odoo App Store. If you will want to see that where it. Where you can. So you can write down Udo App Store, Dashboard Ninja on Google. You can easily see our app is there on number one. Okay, first thing. Second thing that what is the benefit of this product? First benefit is that we are able to generate recurring revenue by selling the products. Second thing is that whenever anyone is buying this product most of the time they are using the ERP and they needs people to people means engineers to develop or maintain their ERPs. So it is. I. You can say that this. It is a. A way to step into their home to get all the work into their home. Okay. So by selling this product direct we generate only $500 to $600. But most of the time we. We get work monthly sometime $5,000, $10,000, $20,000 $30,000 monthly. Okay. We have some products where customer is giving $25,000 continuously every month since last three years. Okay.
So this is the benefit of the Dashboard Ninja direct generated revenue. I told you 1 million indirect is something that this quarter I think we have generated approximately INR10 crores by Odoo. And this product is the Odoo application. Right?
Unidentified Participant
INR10 crores by the odoo product business?
Ratan Kumar Srivastava
Odoo division. And all this business how we get through product selling we get leads through marketing and all but major part is by selling the products we are getting direct customers.
Unidentified Participant
Okay. At an aggregate level across the firm. If you could give a breakup between services to products and where do you see that number going in the next probably couple of years?
Ratan Kumar Srivastava
See for the next three years. We have one more product. DFM Data Flow Manager, which Manish has explained. This is a big data product. Okay. And as per my understanding, this is going to be huge success of Ksolves and we are talking to one customer. It is not finally done, but we are in the process and almost it is done. And this deal is something that a small deal. But this product is something which is going to create another level of success. Okay, how? Because big data it is not something that any small company will use, which is cased with the dashboard. Dashboard Ninja. Okay, where small customers are using. But give me one second. Give me one second.
Yeah, Dashboard. But DFM will be used mostly by billion dollar company or at least $100 million company who will have the budget to use Nifi. It is not. It is very costly. So DFM will give us another level of success. We will generate revenue by selling this at the same time by supporting to the customers. And then again when we will enter into their home or business, we will get more development. Also it is almost ready. By next quarter we will have a something good news.
Unidentified Participant
Fantastic. But just again, if you could just divide that revenue…
Ratan Kumar Srivastava
Okay. Next three years my target is that right now it is 98 is to do. Okay. I would like to make it at least 10% or more than 10%.
Unidentified Participant
Okay. And finally on the margins front, I know you mentioned that 35% operating margins you believe are sustainable. Just wanted to have your take on that again. And if you could just break down the foreign margins from 43%, 42% last year to 37% this year. Where is that 6% Delta coming from? If you could just help us understand that.
Ratan Kumar Srivastava
See, some companies invest huge in hiring a senior position in early stage. But we have done in a reverse method means initially we didn’t have any enough seniors. For example, recently we have hired a Director of program and delivery. He’s I his pass out from IIT Kanpur. Okay. Then we have hired one person, he’s from E&Y and he’s uh helping us to prepare the RFPs and all. So these kind of position now we are uh filling. Okay. We in the last to last quarter we have hired VP Engineering for aiml. So these positions are not billable. Direct billable. Okay. But these positions are helping us to increase sales. Okay. So that is the reason.
And second thing that we have invested huge money for events, traveling and all in future we will also do. We will also — we will again invest money for events for traveling. Because at this level, last time, last quarter I said that at this level we need large ticket size customers and it is not possible through LinkedIn email campaign and cold email. Okay. It is only possible when we travel when we meet to the customers. Okay. This Friday I’m traveling with Manish and my delivery head to us again to meet multiple customers. So projects which we are looking right now. Ticket size which we are looking right now. It is possible when we will meet them in person. When we are going in June we are going to attend Gartner where lots of companies are coming. Okay. We will give them. We are going to join this event as a speaker. We have a invitation for a speaker as well as we will have a booth there. So these kind of investment we are doing but in one line. If I’ll say for next three to five years I’m very confident that I’m not going to below 35% margin because I think I have done all the recruitments for the senior positions. I don’t see many more senior position for now. Okay. Whatever money I will spend for now I think it will be for the billable positions either or for the marketing and the travel. This is so OPM or margin will not go below than 35. It is, it is. I mean I’m confident about this.
Unidentified Participant
Got it. And the you know, sort of 5, 6% delta from last year to this year is explained by the increased sales and marketing expenses.
Ratan Kumar Srivastava
Sales, marketing, travel, event and then senior position recruitment which was required. Because if I’m saying that I’m going to work in the AI and all then I should have some senior people. So I. Right now I have a person from the industry who has a 20 year experience. Right? So if I am saying that right now the current strength is 600. And if in five year it will be 1500 for example then I should have someone who can manage the operations, who can. Who can create the structures, hierarchies, role roles and responsibilities for everyone. We should have kra. We should have proper appraisal, appraisals, cycles. Okay. Application format, feedback system, training system, everything. So that person is handling all these things. So. So the 6%, the delta is there. You can see.
Unidentified Participant
Got it. Got it. Just one final question. If I’m not taking up too much time. You have operating margins in the range of 35% to 40%, which is not typical of an IT services company. Usually services company would have much lesser margins. What is in your opinion, your differentiator that helps you enjoy such margins?
Ratan Kumar Srivastava
See, what others are doing, I don’t know. Okay. But your previous question was that why we are going down. Okay. We said that time we were not spending the money. Okay. We have started spending money on marketing and all. And again in that I have given you statement that 35% will be the point where we will stick. Okay. I think for this percentage utilization of the resources is very important. If you will see the last three quarters, we have not added so many resources. But our revenue is continuously increasing. So utilization is I think the key for this OPM or maintaining the margin.
Unidentified Participant
Understood. Okay. Thank you.
Ratan Kumar Srivastava
We have not added so many employees. If you will see the last three quarters or four quarters.
Unidentified Participant
Right, Right. Okay. Thank you so much, sir.
Ratan Kumar Srivastava
Thank you.
Vinay Pandit
From Sharia Puniyani. Sharia, you can go ahead.
Unidentified Participant
You mentioned that you have grown 30% for the past 15 quarters year on year. So it is safe to say that. And. And you also mentioned the big data projects that you will that are upcoming. So it’s safe that you’ll grow at a 35, 40% growth rate for the next two, three years.
Ratan Kumar Srivastava
Somehow your voice is breaking. Can you come again please? Can you repeat the question? Maybe I’m not able to understand.
Unidentified Participant
Hello, am I clear now?
Vinay Pandit
Yeah, yeah sure. Please repeat the question.
Unidentified Participant
So you said that since the. The big data for the DFM projects are also coming up. So is it safe to say that you grow like 35, 40 year on year like for 2, 3 years at least?
Ratan Kumar Srivastava
You are talking about the growth or you are talking about the margin?
Unidentified Participant
The growth.
Ratan Kumar Srivastava
Growth. We will maintain minimum 30% for next three to five years. Okay. And margin we will maintain minimum 35% for next to three, three to five years. That is that I’m confident. Okay. Above than that maybe if this DFM will create something magic. Okay then maybe we can go above than that. But I’m very conservative. I’m taking that. I’m saying that 30% I would be able to maintain.
Unidentified Participant
Okay. And so what are the types of contracts like? Is this a subscription based contract we have with the customers or what is the structure of the contract?
Ratan Kumar Srivastava
For DFM?
Unidentified Participant
In general with your clients.
Ratan Kumar Srivastava
See, for — there are two things which we are doing even three things. One is services. Second is support. And third is product. Okay. For support it is most of the time either TNM or fixed cost. Okay. And age of the projects is between one to three years. Okay. Now, age of the project is between one to three years. Okay. Now supports it is subscription based. Means once — once customers are applying for our support. Okay. They pay us for every year. Okay. And product for dashboard India it is one time they buy it. But for DFM it is again yearly subscription. Every year they will pay and there are so many things. Silver, gold, platinum, enterprise. We have the roadmap. Okay. And you will see something good in future.
Unidentified Participant
Okay sir. Thank you.
Vinay Pandit
Thank you. We’ll take the next person from chat window. Ashwin Palaniappan, you can go ahead please.
Unidentified Participant
First of all I’d like to congratulate for the good set of numbers that you have posted. I was late to the meeting so my questions will be around the last few slides which has been posted. I’d like to start with the first question. You talked about a few case studies. How can we get it?
Ratan Kumar Srivastava
Manish, over to you.
Manish Gurnani
You are looking for what?
Ratan Kumar Srivastava
He’s basically looking at an opportunity where you can get the details of the case studies.
Manish Gurnani
Case studies, right. Okay, fine. Actually case studies are already in the investor presentation that is uploaded on the exchanges. So you can refer to that. You can just click on that and you will get the case studies.
Unidentified Participant
Yeah. Okay, thank you for the confirmation. My next question would be like on the AI product you talked about. All the data is being exchanged via OpenAI servers and in this one, what level of license do we use? Because we all know that OpenAI uses the client data for processing their model. Are we allowing the user data to be training their model or it is a private enterprise edition so that data is not being used for training.
Ratan Kumar Srivastava
Manish, over to you.
Manish Gurnani
Okay, so see, when we talk about OpenAI. Yes. OpenAI also has different ways, right. So one is like you said, right. That you have to share the data. You know, they don’t make you again have a given that they do not store their data. Right. Our product, right. What we have done is. You’re talking about our world, right? I’m assuming, right?
Unidentified Participant
That’s right, that’s right.
Manish Gurnani
With that we have used Azure Services. With Azure Services, what you get is an additional sort of an interface with OpenAI where your data stores within is stored only within your vpc. It’s not going outside of your vpc. That feature is only available. So depending on what type of, how comfortable the customer is. Right. They can use our man, which is integrated Azure. Right. Or if they want, you know, completely on premise. Right. Then we have, you know, what you call as a llama based server also running, which can be hosted on premises.
Unidentified Participant
Okay, okay, I got it. Thank you. And the next question would be on the big data manager. So you said that you’re working with the African telecom giant. And if I would like to understand it better, are we doing an end to end service for them or just a existing one and Ksolves is managing that and is it a short term contract or is it for a long term that is already signed with the giant.
Manish Gurnani
So it’s a long term contract. And what we are doing for them is so see, the system was already up and running right now the problem is that system has been sort of, you know, giving challenges as you know, over time now consistently. Right. That’s when they reached out to us because we are. And they are using NIFI also extensively. Right. And if you search for nifi, right. You will see Ksolves coming, you know, on top, you know, anytime you search for, you know, foreign development company for Niper. Right. That’s how they reached out to us. And then what has happened is, you know, once we started engaging with them, right, we realized that lot of, there are a lot of, you know, there were a lot of issues tools in the existing way the system was being set up. Right. S
O we had, we have worked with them and we have re-architected some of those, you know, those systems. Right. And that has given them a great, I would say efficiency. What some processes which were earlier taking four days to. To complete. Right now they are being done within under an hour. That is the level of vision that we have brought to their, you know, some of their process. Right. There are still many more, you know, recommendation that we are working on them. But it’s a long term project and it, you know, the beauty is that it is one of the biggest, I would say, you know, telecom project that we have been involved into. So that’s giving us a lot of insights into telecom domain.
Unidentified Participant
Yeah, that’s great to hear.
Vinay Pandit
Your line is breaking up, we’re not able to hear you.
Ratan Kumar Srivastava
And this is best example that how we got this product project. We traveled to Morocco. Okay. And then we got this product means we had to invest our money for traveling. Okay. So right now what we are doing, we are con, we are offering customers that. Okay, we are coming, we will discuss. Okay. And customers are happy with this offer. And out of 10, 6 to 5, 5 to 6, we are winning.
Unidentified Participant
Okay, that’s great. My final question to you is like, I’m glad to see that case also launching new products now and going forward, do you foresee that major revenue is going to be part of your products or will it be still services?
Ratan Kumar Srivastava
See in long term, maybe in long term I’m very optimistic about the dfm. Okay. But our major focus is on the services. Right now we are getting lots of queries for the services. We have lot of inquiries from the customers. Right now we are facing problem for the supply means resources. So we are focusing on the services but at the same time, because that is our bread and butter. But in the longer term we are looking, we are expecting that we will get good revenue from the product also especially from the dfm.
Unidentified Participant
Okay, that’s all from my side. Thank you for answering the questions patiently and all the best for the future quarters.
Ratan Kumar Srivastava
Thank you.
Vinay Pandit
We’ll take the next member from the chat. Mr. Ram, you can go ahead please.
Unidentified Participant
Hi, am I audible?
Vinay Pandit
Yes.
Unidentified Participant
Yeah. Okay, sir. I would like to first start by congratulating and thanking the entire Ksolves team for posting such stellar results from the inception from the IPO to now. But sir, as an investor, notice that some insiders, I mean your stake also has slightly reduced in the company, but you still retain complete control and everything. But there are other insiders, I believe who have completely exited their Ksolves stakeholders. So like that is a very personal issue and you know, that is completely their prerogative. But that for other investors who look to buy Ksolves stocks, I think that turns out to be a slight worrying point. So I was thinking about the same. Could you guys look into buybacks instead of dividends or any other corporate action in that sense?
Ratan Kumar Srivastava
In future you may see this. But if you will talk about me, since last two and a half year I have not done any selling, okay? And I don’t think that you will see from my side what others are doing. I’m not responsible for that, okay? But I’m focusing on completely on my work on the company growth. I’m looking for longer term, long term. My goals are long term. It is not something for this quarter or last quarter, okay? So that is, you can see in that consistency. You can see in my work continuously I’m giving growth, okay? Despite. I don’t think — sorry, I don’t think, I don’t. I’m not worried about that. What is the what where stock is going? Definitely I’m meeting with the investors. I’m. I’m provide, I’m giving answers if they are asking any questions. But market is not in my control. In my control. What is in my control? My work, okay? And I think me and my team is continuously doing hard work. We are delivering the result. If you see the sales, if you see the margins, okay, everything is good. We are expanding continuously, okay? So I think I’m doing my duty completely with honesty and with the full integrity, okay? And rest of the things are not in my control.
Unidentified Participant
So completely understand. And again, I don’t mean to sound like intrusive but I completely recognize how well you guys have done. So again, thank you for that as an investor. But the question was, I think last call also someone had asked you about doing some corporate action and you guys immediately you have announced for a split. So again that is something I think hopefully the market will take notice. But could you guys also think about buybacks maybe later in the future?
Ratan Kumar Srivastava
We are thinking. Wait for that. Okay.
Unidentified Participant
Sure, sir.
Ratan Kumar Srivastava
You know that buyback it is not something that we can do frequently. It happens once. Okay, so wait for that time. We will do that. So I’m not giving the commitment that when but in next one year you will see.
Unidentified Participant
Okay, sir. Is there — are you guys taking any. Are you actively soliciting some form of institutional investors?
Ratan Kumar Srivastava
See, I’m not very active to —
Vinay Pandit
I mean, avoid that question. These are forward looking statements.
Unidentified Participant
Okay, sure. Okay, sure. So yeah, one final thing. So for you personally, if you were. If you had to choose between you know, having your current great margins at the cost of low growth, which might not happen, but if that was the choice, if you have to have great margins right now and low growth, but the other option would be you are okay with slightly lower margins but you are going to go for higher growth. For you personally, what would you choose?
Ratan Kumar Srivastava
See, this is. You have given me option zero and one kind of. Okay. But I think better that if I say that sales and growth, okay, 30% and 35%. Okay. And you can see that option one means I have compromised already with the margin. But there should be some limit. It should not be that it should continuously go down. Okay. So that’s why I said that, okay, 35% will be the point. Point where below that I will not compromise. But 35% is good. Okay. And even right now we are maintaining 37%. This quarter we have done 37%. Last quarter we have done 37. 38. 30. 35% is the lowest which I can afford. Okay. And below that I will consider that I have done some mistake in calculation.
Unidentified Participant
Okay, sir. Sure. Okay. Yeah, that is it. Thank you so much. All the best.
Vinay Pandit
Thank you. We’ll take the next question from Manan. Manan, you can go ahead please.
Unidentified Participant
Thank you so much. Am I audible?
Vinay Pandit
Yes.
Unidentified Participant
Yes. Congratulations on the great set of numbers. Sir, I had two questions. First question would be that even as Ratan sir is saying that we’ll be growing at 30% with 35% margins. So I definitely think that we’ll be coming up with more products. We currently have come up with products or we are not coming up with more products. Okay. So all I wanted to ask was that even as for that growth, are we planning any sort of debt that we are going to take or something like that? That is my first question.
Ratan Kumar Srivastava
Okay. I’m not going to take any debt.
Unidentified Participant
Okay. Very simple and very straightforward. Thank you.
Ratan Kumar Srivastava
I don’t need. I don’t need why I will take. See, there should be reason. I don’t. I don’t see any reason that I should take a debt. Okay. So that’s why I said okay. No, I’m not planning if you. If you are as if behind this question you are. You have some other question in your mind. Okay. So I don’t know what will be the answer. But for a straight question. Answer is straight. No.
Unidentified Participant
Okay, right. Understood. Thank you so much.
Ratan Kumar Srivastava
But if there will be some reason. Okay, then maybe. But there should be enough reason. Right now I don’t see any reason.
Unidentified Participant
Correct. So that what I was asking because you said that we’ll be growing at 30% term. Also I just…
Ratan Kumar Srivastava
For 30% growth I don’t need any debt for first thing. Okay. Second thing, I’m not dependent on the product. Product, I have explained because few of you were asking that I’m. What am I expecting anything from the product? Yes, but forget about the product. If I say okay, 30% I’m considering sales with services. Okay. Not I’m — I’m not saying that with product. Now I’m looking some sales and that will help me to maintain the 30%. I do not want create this confusion. Okay. Forget about the product. Okay. What will happen? We will see in the next quarter. Okay. I’m focusing right now in this call, I’m giving whatever number based on the services, what I have in the pipeline. What kind of queries I’m getting from the customers. Okay, so 30% of sales and 35 margin for the services, not the product. Product is something different which before you someone asked. I explained that. Okay. If we are developing, maybe we will have some good news. But I’m not confident at this moment. Okay, we will talk about this question product about product in the next quarter.
Unidentified Participant
Okay, Got it. Thank you. And the second question is, do you — could you name any listed competitor if you have. I am pretty new to this business, which is why I’m asking.
Ratan Kumar Srivastava
See, competitor means the other companies who are similar — similar kind of work, right?
Unidentified Participant
Yes, yes, yes.
Ratan Kumar Srivastava
Okay. So similar kind of work. What we are doing Infosys, Persistent, LTI. These are the companies which doing the same kind of work. I will not say that they are competitors. They are very big fish. But most of the time customers for them we are working. Okay. They say that they are. For them persistent is handling the big, big chunk of the work. Okay. Or Accenture is handling big chunk of the work where we have a small chunk of the work. Considering our small size they cannot give us that big chunk of the work. But they are increasing month by month, year by year, our quantity of the work. Okay?
Unidentified Participant
Right. Right. Understood. Thank. Thank you so much, sir. All the best for the future.
Vinay Pandit
Thank you. We’ll take the next question from the chat from Mr. Pura Upadhyay. Pura, you can go ahead.
Unidentified Participant
Hello. Can you hear me?
Vinay Pandit
Yes.
Unidentified Participant
Yes. So first of all, sir, congratulations. And my first question was, so a large part of our revenue comes from the North America belt as you said. So amid the possible new policies and trade uncertainties do we see any kind of risk in our business and customers?
Manish Gurnani
Honestly speaking, I don’t see any risk. Okay. Continuously we are getting inquiries for more resources. Okay. More work. But there may be some specific reason. First thing that we are working on the niche technology. So finding good resources on those technologies are not easy. So that’s why we are getting inquiries. Second thing is that in US most of the companies are trying to reduce the cost. So either they are moving for automation or gender generative AI. And third, they are asking Indian engineers for their work which are less costly. So I don’t see any problem. Problem will happen. Or maybe I. It may be my opinion, maybe I’m wrong. But maybe if our people will work, we will hire people in us. Okay. In that condition I may have a problem. Okay. But I don’t know. Fortunately or unfortunately, right now our whole team is working from the India. Okay. So cost is manageable. We are continuously getting the work. So I don’t see any problem from the us from the Europe or any other country.
Unidentified Participant
Thank you, sir. I had one more question. So in the past couple of quarters, so we’ve taken parts in various basically exhibitions of basically generative AI. And we basically spent a lot on marketing as you said. So all of those costs and basically all those efforts that we’ve put into all of this. So are we able to acquire new clients after all of that? Like because a lot of our revenue comes from repeat sales. So how important are you looking at acquiring new clients as of now?
Ratan Kumar Srivastava
We are acquiring the new clients new business. That’s why our sales is getting increased. You can see the growth. Okay. Second thing that Manish explained you that telecom customer, we met with that customer in event. Okay. So going into those events are helping us to create contacts and directly we have see face to face interaction is always more effective as compared to this online. Okay. This online interaction. So when we are meeting with them face to face we are able to convert businesses and we have generated me see why I will invest money for the next invest if I’m not getting the ROI. Okay. So I’m getting good ROIs. Okay. And sales team is able to convert leads. Okay. And I think that this is a good way to generate more business. We are meeting directly higher authority or people from the CXO positions in those events who are a part of the decision making team. Okay.
Unidentified Participant
Thank you very much for your answers and I wish you all the best for the future endeavors. Thank you.
Ratan Kumar Srivastava
Thank you.
Vinay Pandit
We’ll take the next question from Karan. Karan, you can go ahead please.
Unidentified Participant
Thanks, Vinay ji. I have couple of questions. So first thing is on the last con call you mentioned about some acquisitions that you will be looking forward to it. So are we still considering acquiring some other companies or like you want to grow the revenue from the new product innovations. Can you share some thoughts on that?
Ratan Kumar Srivastava
I was always against to the acquisition. But as we are a human so thoughts keep changing. Okay. So in last few quarters or last quarters I thought that I considering the current pipelines and the requirements. My tag team is talent acquisition team is facing problem to hire resources. Okay. In every call I say that I don’t have problem on the supply project side. I have problem on the supply side. So I thought that if I can get some good. If I can acquire some good companies, small companies definitely. So that I can adjust them or I can manage them. I can manage them. If the company will be small maybe I would be able to manage. Because I always said that If we acquire then the culture and the if team is the company which we are acquiring. If size is big, then it may go in a reverse direction. So I’m very cautious. First thing that I’m looking for a small company. Second thing that they should have some good projects, resources should be good. But finding these kind of companies are not easy. Okay, so still we are searching but till now we could not get. But once we will get definitely we will go for that.
Unidentified Participant
And sir, would you also consider the valuation of these companies if you plan any kind of acquisitions while considering these small in size and culture?
Ratan Kumar Srivastava
We are evaluating. We have merchant banker. Okay. So we are doing this. But unfortunately small companies are not doing well. Okay. They have lots of problems, lots of problems either on the management side or on the technology side or on the resourcing side. So small companies are not doing well and big companies I’m not going to acquire. So in another way I can say that right now I’m focusing on the organic growth only because inorganic I tried and I’m trying but it is not easy.
Unidentified Participant
Understood, sir.
Ratan Kumar Srivastava
I don’t want to take any bad decision.
Unidentified Participant
Okay, I appreciate that sir. One last question I have is. So since our revenue is coming from multiple countries now, Africa. So we have an African client, North American client also you mentioned. Right. And going forward we will be signing more deals in some Middle east based clients also. So to maintain the margins I feel one risk which is of currency, foreign currency risk. Right. So that can impact our margin not to a greater extent, but to slightly exchange. So do we have any kind of foreign hedging policy so that we can mitigate such kind of risk and maintain our margins going forward?
Ratan Kumar Srivastava
Right now it is. I don’t think that I need to worry about this. But yes, I was talking with my. I was talking with Umang who is a CFO about this hedging and all. Okay. When we should do think about this and why companies do this. Okay, So I am aware about this. But right now I don’t think that it is a problem for us. But in future maybe we will have to think. Okay, but considering the current situation, where we are right now, it is not required.
Unidentified Participant
Yeah, because dollar is going down and US dollar is going up. Right. But what if the things can turn around? Right. So in that case…
Ratan Kumar Srivastava
It will not happen in One day now. Okay.
Unidentified Participant
Okay. Understood.
Ratan Kumar Srivastava
Okay. It will give me time.
Unidentified Participant
Understood, sir. Okay, thanks.
Vinay Pandit
We’ll take the last question for the day from Mr. Rishi Sinha. The new US administration is talking about tariffs if they do it on software services. Are these tariffs passover or are all U.S. projects on fixed cost deals?
Ratan Kumar Srivastava
Sorry, someone knocked the door. Can you repeat the question?
Vinay Pandit
The question from Mr. Rishi Sinha is the new US administration is talking about tariffs if they do it on software services, are these tariffs passover or are all US projects on fixed cost deals?
Ratan Kumar Srivastava
No, are all projects are not fixed cost project. Okay, but honestly speaking, if I give you the honest answer, I could not get time to think about this. But offline I will discuss with this and then I can answer on this.
Vinay Pandit
Okay. Thank you. So since that is the last question for the day, would you like to give any closing comments before we end this one?
Ratan Kumar Srivastava
Yes. So thank you everyone for giving your time — precious time and asking questions. Okay. I have few things means from my side. Five years before approximately I have started. I have started this IPO, okay — launched this IPO, okay. And since then. Since then every day I’m learning because I’m kind of a first generation businessman. So every day I’m learning and I think that day by day I’m getting more mature in terms of the as a businessman. Okay? So no one can say that every decision or everything is perfect. But as of now, I think in last five years I’m running the company very successfully in terms of the growth, in terms of the margins and also people, what kind of people we have right now in the company. We have an excellent culture. We have so many people who are working with 5 years, 7 years, 8 years, 10 years. Almost every week we get notification that this person has completed five years, three years, seven years, eight years. Now this is not a news for us because kind of a news which is coming every week. Okay? So we don’t notice. Okay.
I have not built only a good company in terms of the sales growth or the margin. I have also made a company where people are there means people are happy in Ksolves okay. People wants to give more than what they can give. Okay? So that is the reason our utilization is high. It is not an easy answer to explain them that how utilization is high. But I think it is a people who are working by their heart with full honesty and all. So that’s why I said that I have not built only a company which is giving growth and margin. I have built a family where 600 people. And most of them are working since long time with me. They are very happy with my decisions, whatever I take. Okay? And they want to work with me. So that is something which I wanted to convey with you.
And I’m targeting that from 600 to 1500 in next five years. But yes, culture matters. For every company sales and our nation is important. But also the culture, if it is toxic, then it is not a long term. It is not long — you cannot survive long term. Okay? At some point you will be alone. Okay? So we have excellent culture where people meet, they discuss, they exchange their thoughts. And then we collectively take the decision or however Vito is with me. But they give us their suggestions without any fear. So that is my success which I wanted to discuss with you or tell with you to or to all of you. So that is all, Vinay ji, from my sadness, I’m very happy as that I have built something as a company where people are happy. Okay? They want to work with this company. That’s all from my side, right, sir.
Vinay Pandit
Thank you. Thank you so much. And thank you to all the participants for joining on the call. Thank you to the management team for the valuable time. This brings us to the end of today’s conference call. Thank you. Thank you.
Ratan Kumar Srivastava
Thank you.