Onward Technologies Ltd. (NSE: ONWARDTEC) Q4 2025 Earnings Call dated May. 16, 2025
Corporate Participants:
Asha Gupta — Investor Relations
Jigar Mehta — Managing Director
Analysts:
Unidentified Participant
Parth Damani — Analyst
Sameer Dosani — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Onward Technologies Limited Q4 FY ’25 Earnings Conference Call. As a reminder, all participant lines will remain in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touchstone telephone.
Please note that this conference is being recorded. I now hand the conference over to Ms Asha Gupta from ENY Investor Relations. Please go-ahead.
Asha Gupta — Investor Relations
Thank you, Reyan. Good day, and welcome to Q4 FY ’25 and Full-Year Earnings call of Technologies Limited. The results and presentations have already been mailed to you and you can also view them on our website, www.onwardgroup.com. So to take us through the results today and to answer your questions, we have with us Mr Jigar Mehta, Managing Director of Onward Technologies Limited.
He will start the call with a business update and financial performance for the quarter and years gone by, which will be then followed by Q&A session. As usual, I would like to remind you that anything mentioned on the call that reflects any outlook for the future or which can be construed as forward-looking statements must be viewed in conjunction with the risks and uncertainties that we face. These risks and uncertainties are included, but not limited to what we have mentioned in the prospectus filed with SEBI and subsequent annual report that you can find on our website.
Thank you. Having said that, I will now hand over the call to Mr Jigar Mehta. Over to you, Jigarh.
Jigar Mehta — Managing Director
Thank you, Asha. And thank you, everybody. Welcome again, and thank you for joining our Q4 and full-year FY ’24 ’25 earnings call. It’s a pleasure to connect with you all again this quarter. I hope you’ve had a chance to review the presentation, the earnings deck and the press release that we released a couple of hours ago post the Board meeting this morning. Let me begin by giving a quick overview about last year and then Q4 and then where we are going.
For us, last year was a bit of a consolidation year. We were — so we started the year expecting substantial revenue growth from both of our large verticals, which is the industrial vertical and the automotive, while the industrial vertical continued to grow and they did fairly well and we were able to win substantial number of large customers, our automotive business along with the whole external environment saw a substantial slowdown with a massive impact from the Tier-1 business, the auto components companies that we work with across North-America and Europe,
A substantial slowdown there, including shutdown of several projects in Q2 and Q3 due to the external environment, which was the war, the supply-chain and of course, then the tariffs which came up in Q4. So we were impacted, of course, by that and there was a majority of the revenue slowdown came in because of the slowdown for us in the automotive. Our healthcare business, which is fairly new vertical HCLS vertical and that continued to make inroads into new clients and I think they have an amazing runway for the next five years.
Coming back to Q4, Q4 was a good quarter for us compared to where we left off in Q2 and Q3. We delivered INR127 crores of revenue INR127.3 to be precise and 10.9% EBITDA for the quarter, which enabled us to deliver consolidated INR498 crores of revenue and 9.1% EBITDA for the full financial year. So again, very close to the INR500 crore mark and I think it would have been great for us to cross that just to make it a bit more attractive. But overall, quite pleased with the run-rate that we could manage in Q4, especially with the uptick in our industrial Business and in the vertical, especially from North-America. So now coming back to the Q4 performance, it — the revenue was — we had a sequential growth of 3.2% and 7.5% on a year-on-year basis. On the EBITDA side, we had 183 plus BPS quarter-on-quarter growth. And we continue to believe, I think we will see positive momentum in the next few quarters as we keep building up the revenue base with majority of our fixed-cost now fairly stable as we go into FY ’25, ’26. Now coming back to our business model, where we are today, I am very excited to share. We announced about nine months ago that we are moving the organization to a vertical-based structure. We have two large verticals, which is IEHM, which is industrial equipment and heavy machinery and second is transportation and mobility, which includes automotive and rail. I think both of — and the third, of course, is our HCLS vertical. All three verticals will have a P&L leader, which runs all the way to the EBITDA. So I’m very pleased to announce that we have, of course, my cousin, Trapesh, who runs healthcare vertical, but now we’ve recently hired a new leader to head our T&M vertical. We will be very happy to introduce all of you to this gentlemen next quarter. And we also brought on a new CIO. That’s the first for us. Both of these senior positions reported to me directly and are based out of offices, both two different offices, one in Karadi, one in. And I think they will add substantial value and depth as we try to go from the current INR498-odd crores to INR1,000 crores in revenue over the next few years. So we continue to look for a new leader for our IEHM vertical, PM leader, which is our largest and fastest-growing vertical today and I think we should find somebody very soon. Currently, the IHM vertical is in very good hands. We have three amazing capable leaders and they’re doing a fantastic job as they keep ramping-up with our existing customers in US and Europe. Now in terms of operating metrics, our top-five, 10 and 25 clients continue to grow, and I think they’re doing well. Our relationship and our engagement is getting better. Similarly, we’re now focusing on our next 25 customers as well. So our top-50 customers will have very focused ASMs and ADMs, which is account managers for each client and multiple delivery managers or one or multiple delivery managers for each large OEM client, right? This allows us to serve them in multiple geographies, multiple LOBs and multiple — multiple product lines that the customer may have, right? So it’s not easy for an engineering business for one person to handle everything. So we do believe our salesperson, account manager will be supported by a large number of very capable execution and delivery and high-quality leaders. So going into projections, so while we have shied away historically to not give projections, But we feel comfortable where we are with a very focused execution model now going into for the next couple of years or at least next three years, we are comfortable that we believe we will — in a conservative side that we should be able to deliver both double-digit top-line growth and double-digit bottom-line growth towards the EBITDA. So that’s what we would like to focus on. And again, to reemphasize and reinforce, we believe majority of that would come from our existing clients and especially the top-50 clients. If you look at last financial year, we invoiced total of 80 odd clients globally, which was on, 31 March 2025. We believe over the next three years, that number will gradually keep coming down and we will keep betting on that top-50 clients, which love us and obviously, we love working with them and all of them will be predominantly headquartered in North-America and Europe. In terms of preference, things have changed, especially with the whole new discussions on tariffs and the whole new discussions on Make in India or support every global company setting up large GCCs in India. So we are very comfortable in running and scaling up our GCC business where we invoicing INR. And of course, we have a very now solid model both in US and Europe. So we do believe all three geographies should keep growing and based on the external risk factors, we can mitigate that by one of the other markets growing for us. So for example, if a US company wants us to expand in US, which happened to us last year and we were not ready because we didn’t have the Visas. And now we’ve already invested in the Visa. So we’ll be in a very solid situation or we are already in a very solid place going into this year. Now the same customer has a slowdown in US and wants us to ramp-up India GCC in India. We have a beautiful execution engine towards that. So I think we are very well-covered in terms of supporting our existing clients on a global basis, especially in North-America and Europe and we will continue to focus on that for the next three years instead of getting distracted with other geographies. In terms of investments, I think this year, our investment strategy is very simple. We had the Board discussion this morning as well. Our total capex budget is approximately INR12 crores, which includes upgrading all our office infrastructure in Pune, in Chennai, and of course, new sales offices in UK, in Michigan and in Munich, in Germany. And on the balance part of the investment in capex would be substantially on the hardware and upgrading our labs and everything else that we’re doing, especially in our design centers into the engineer. With that, our strategy just to close-out and open it up for questions, our strategy remains very, very focused and centered around our existing clients. We believe we work with already some of the best clients in the world. We would definitely get — keep getting reference clients from our existing OEM clients and seen them convert much faster, but we do not have a sales force anymore in the organization. It’s very, very focused on execution and delivery. We remain very focused on all three lines of businesses, which is digital, which includes AI, data analytics, cloud, Ember Electronics and mechanical engineering services. We don’t have a preference. All three grow based on the customer demand cycle. And third, in terms of geography, very, very focused again only on North-America and Europe. So we’re not getting into Asia or India or any other markets on a global level. So with that, we believe we are well-positioned to sustain our growth momentum that we saw in Q4 and this is despite the external macro uncertainties. And we believe that we can continue to add lot more value to our customers and we’re getting very positive feedback from them as we continue to evolve on a quarterly basis. Thank you again for all your support and trust in us. I will now hand over the floor to the operator to start the Q&A session. Thank you.
Questions and Answers:
Operator
Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use your handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question comes from the line of Raja Vardan from AstroLite Investments. Please go-ahead.
Unidentified Participant
Hi, hi. Good evening, Jagar. Congratulations on a good set of results. I just have a couple of questions. We’ve grown by about close to 4% to 5% this year and last year. What kind of revenue guidance or revenue growth are we looking at for the coming year — coming fiscal year and the following year.
Jigar Mehta
So hi,
Unidentified Participant
Hello.
Jigar Mehta
Good evening. So as — can you hear me?
Unidentified Participant
Yeah, yes, I can hear you.
Jigar Mehta
Perfect. So as mentioned earlier, what we based on so many external parameters around us right now, we feel comfortable for the next three years to grow double-digit both in revenue and that’s the guidance I think we. I think things hopefully things get calm around us globally. I think we can get into more specifics. But starting April 1, 2025, we are sticking to double-digit EBITDA, both on-top line and bottom-line.
Unidentified Participant
EBITDA, I can appreciate that, Jagar, but just my question is more towards the top-line, right, because a double-digit can at least you give a little more hint if it’s going to be low — are we expecting lower double-digit, higher double-digit can mean 10% or 20%, right?
Jigar Mehta
Yeah. So I would say 10% to 12%. I think that’s a good conservative number for us to play with right now.
Unidentified Participant
Okay. Okay, sure. Thank you.
Jigar Mehta
Thanks.
Operator
Thank you thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one? The next question comes from the line of Parth Damani from Tirupati Equity. Please go-ahead.
Parth Damani
Yeah. Hello. Yeah. My question is, where do you see yourself in like three years, the realistic target , any realistic target?
Jigar Mehta
Where do we see ourselves in three years? I think if you compound double-digit, let’s say, 10% to 12% revenue growth and you compound the same thing on the bottom-line side. I think that’s where we will be. I think we can do much better and this is just focusing on organic. Yeah, if we get an opportunity to do inorganic, I think that will give us a much bigger boost as well.
Parth Damani
And any deal tailwinds?
Jigar Mehta
But more importantly, we want to go back to our basics where we believe we’ll go down from a client perspective to a few clients, which will help us scale much faster and bigger than where we are and that’s how we add more value to our clients.
Parth Damani
Okay. And any tailwinds you want to worth talking about?
Jigar Mehta
We don’t have deal wins, as I said, we are focusing on existing clients and we win new deals with them every day.
Parth Damani
Okay, okay. And then guidance of INR600 crore of revenue is doable in FY ’26?
Jigar Mehta
Yeah. So we are not — we have removed that guidance now part, as I said, because of all the macro-environment around us. What we are guiding is double-digit revenue, which is 10% to 12% and EBITDA double-digit.
Parth Damani
Okay. And what is the plan for of the cash which we have in the balance sheet, any buyback or acquisition?
Jigar Mehta
That’s what we are evaluating all of that. The Board has declared a dividend today of INR5 a share, which is our 10th consecutive year. We are evaluating buyback, we’re evaluating a lot of other stuff. But where we would like to really use the cash that the company has generated over the last several years is on scaling up the business. So we’re continuously looking for the right opportunities in both the high-end verticals or both high-growth verticals that we have.
Parth Damani
And just about your non-India business, when it will start to grow,
Jigar Mehta
It’s be our entire INR498 crores is non-India business. We are no India business.
Parth Damani
Okay, okay. Okay. Sorry. Thank you. Thank you. Thank you.
Operator
Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. Once again a reminder, ladies and gentlemen, if you wish to ask a question please press star and ladies and gentlemen, if you wish to ask a question please press star and 1 we have follow-up questions from the line of Raja from Astrolite Investments. Please go-ahead.
Unidentified Participant
Hi, Jagar, I just came back into the queue because I’m guessing no one else has any questions. So Chief, in terms of — again, I’m a huge investor. I’ve been an investor for the last year, year and a half. I’ve been on calls with you on the side with a few of my colleagues, et-cetera. Just in terms of revenue guidance,, I know in the past, we have given some sort of guidances which we haven’t lived up to for whatever reasons.
Do you think 10% to 12% I know you — I understand you want to be a bit conservative this time, but as an investor, as someone who wants to be on this journey with you, do you think hoping for 15% is a bit is a bit far-fetched, it’s something that can be done on a lower base like we have, right?
Jigar Mehta
So again, absolutely. I mean, we are talking about from a base of INR100 crores INR20 crore IN 130 crores a quarter, right? So obviously, the scale can be much faster.
Unidentified Participant
Correct.
Jigar Mehta
But we wanted to give a guidance. Considering the client names that we have, considering the amazing management team that we have in-place obviously. So we have everything going for us. But again, I think you’ll appreciate last year, we were very positive and the whole world.
Unidentified Participant
Absolutely. Absolutely. I really appreciate that.
Jigar Mehta
So we’ve — at a management team level, at the Board level, what we came back with is saying, okay, why do we just — we have to give conservative numbers for the next three years so you guys know we are in the right direction. You know that the customer appreciates us and that we are moving forward and we’re generating a lot of cash.
Unidentified Participant
And the responses from these customers, the feedback has been positive because the cliente we have, even if we manage to crack a $5 million, $10 million account with one of these, which in my humble opinion is not shouldn’t be very hard is that the thought process?
Jigar Mehta
That’s the only thought process. That’s the only thing that we work
Unidentified Participant
Tesla’s or etc.
Jigar Mehta
I said we have 50 of them which are amazing. I think 65 are amazing out-of-the 80 which are — when I say amazing with 65 as of March 31st that these customers change based on the M&A and what the markets that they are focused on. But we are focused on — it’s all about scaling up, right? So we have two clients about $5 million now already.
Unidentified Participant
Okay, lovely, lovely. So again, I feel like the reason why there’s not a lot of questions. Again, I feel like stock has gone really under the radar and people are going to be in for a pleasant surprise is my second question. Yeah, definitely good news for us as investors. Jagar, just another follow-up question on your EBITDA. You said you expect a similar amount of growth on your EBITDA as your revenue. But in terms of absolute margins or EBITDA margin, shouldn’t we expect that to go up by a couple of 100 — it means at least 2 percentage points maybe in a year or two? Or
Jigar Mehta
Absolutely. All your assumptions are right. We have to deliver, right? And again, if we are coming out of a year where our amazing budgeting and planning did not live up to the expectations, didn’t live up to my expectations as well because external factors around me changed so quickly, especially in the automotive industry and the supply-chain. But we do believe this year will be much better. I think it looks very positive.April has been phenomenal for us.
Unidentified Participant
And because in general, you’re talking about the automotive industry in general was a laguard in the last year, Jagar?
Jigar Mehta
For everybody, right, I’m assuming. So any company which was in the automotive space, which did not do M&A organically must-have gone negative.
Unidentified Participant
Sure. And
Jigar Mehta
Then acquisitions to boost up revenue.
Unidentified Participant
Correct. And Jugar, in terms of Trump and all the — I know means he has a habit to talk a lot, et-cetera and these are all tactics at the end-of-the day, but we are seeing like the Indian government and Donald Trump speaking absolute not south head kind of versions about what’s happening, one says there’s going to be free-trade, one is retaliating the next day. It’s — what is the view that you’re getting from that sense? Is there some sort of risk that’s posed to the industry yet or you think that’s going to ease — keep easing out as time passes.
Jigar Mehta
So two points there, what we look at it. One point is, obviously, this is why we’re getting conservative view. We would like to be in a much more aggressive place. So we’ve also shied away from a lot of investments that we are planning to make in US and Europe and managing it from India. That’s one. So we want getting a conservative view from that perspective. And second, obviously, we don’t know, right? Every day is a new day, as you rightly said, but one industry, which is particularly impacting in a very big way is automotive, which was last six months.
And if that comes back to us, I think we will see a lot more momentum overall for the whole engineering industry.
Unidentified Participant
Understood.
Operator
Ladies and gentlemen, we have lost the line of the participant. We move on to the next question from the line of Sameer Dosani from ICICI Prudential. Please go-ahead.
Sameer Dosani
Yeah. Thanks for the opportunity., how to think about the margins from here on, like Q4 margins were really good versus the rest of the year that you’ve seen. Did we have some salary hikes or costs that are coming up in next couple of quarters that can enter margins or we can maintain the margins at the current level of Q4?
Jigar Mehta
I mean, hi. Again, Q4 margins were decent. As I said, 10.9% looks good compared to where we are coming off from last year, but I would say it would like to be higher. Coming back to your question, I think we should be good. That’s reason we are able to give visibility. I think we have the right things in-place where we should be able to consistently deliver double-digit EBITDA margin. So obviously, our goal is to make it much higher and we do believe a better utilization and more seamless execution on the international front, we can get there.
Sameer Dosani
Sure.
Jigar Mehta
To answer your third question on the increments, absolutely. So we always have increments as a young company, important part of the — of for employees, hard. So for us, it’s every year from July 1 to July 1st is our increment cycle. April to June is the appraisal cycle and July the increment cycle.
Sameer Dosani
That’s. Sorry, I couldn’t get you.
Jigar Mehta
Last year. I shared that in the earlier earnings call as well that last year also we did when all other engineering companies did not do any increment, we still gave the highest increments To our team members and that also helps us in terms of obviously employee satisfaction and reducing attrition substantially.
Sameer Dosani
Yes. So Q1, we don’t see any visa cost. I think visa cost normally comes in Q4, right?
Jigar Mehta
Q2 for us.
Sameer Dosani
Q2 for us. Okay. Okay.
Jigar Mehta
So yes.
Parth Damani
Okay.
Jigar Mehta
Q1, there is nothing.
Sameer Dosani
And this double-digit growth mean is INR growth, right? So USD growth would be 8% kind of and maybe 2% from an appreciation. That is how we are thinking about it.
Jigar Mehta
Correct. Yes, yes, yes, I’m just trying to answer your question. I didn’t look at it that way. I only think in rupees.. It will be in rupees terms. So yes, I have not considered the dollar side of things. All my amounts are based on rupees today.
Sameer Dosani
And Vikar, like when I look at last two quarters at least the data that I’m seeing. Sequentially, if you think about it, growth has not been there, right? Current quarter, obviously, I’m assuming that out-of-the 3%, I think 2%, 2.5% would have come from INR depreciation, right, because majority of our revenues are higher dollar-denominated. So sequentially, do you think our revenues can keep — can grow from here on like Q1 will be higher than INR124 crore INR125 crores that we have clogged basis the deal wins that we have. Do we think revenue can grow from there from the current sequentially
Jigar Mehta
Give you a quarter or two to surprise all of you guys. Let us deliver, give us a quarter, so you’ll get a feel of it. I shared the same thing last quarter. I think we did a decent job in Q4. We have to bounce-back towards what it is. As I said, last year was something that we thought will easily get there, but the auto — one vertical did not — things changed differently for us. Otherwise, we would have actually been much, much higher than where we are today. This year, we have taken a lot more assumptions, lot more informed information.
Our budgeting is lot more informed than before. We’ve assumed a flat year for us in automotive.
Sameer Dosani
Okay.
Jigar Mehta
So if that momentum picks up, everything will change for us again.
Sameer Dosani
That’s good to hear that we have factored a lot of things in our budgeting. Okay. And like any area like medical devices, so auto, we have already assumed flat this med — med devices, do we expect growth to come in?
Jigar Mehta
Absolutely. So at the healthcare — the CLS space, which is med device, I think will continue to grow. You know, we went from zero to INR18 crore INR19 crores last year, right? So it’s very hard to predict how big it can become, but the growth will be there. What I don’t know is, will they grow 20%, will they grow 50%, they have a potential to grow 100% as well. So let me give you more updates every quarter because it’s at a very, very early-stage. It’s such a loan number.
Sameer Dosani
Correct
Jigar Mehta
Can really change sort of dynamics. But I don’t want to add that from my budgeting perspective, I’ve been very conservative for that this year.
Sameer Dosani
And
Jigar Mehta
As well, our CFO tell you the same thing. We’ve done very conservative budgeting for verticals because of so many external macro parameters.
Sameer Dosani
Good to hear that. And margin, our guidance is double-digit plus, so 10% plus is the margin we are thinking of. So any — like our last year, we were at and before that we were at 11%. So like what any levers or like what do you think that can help us expand margins
Jigar Mehta
In one just only one thing, revenue growth, only revenue growth, because all the fixed costs are already there, right, because we are talking about revenue growth from our existing clients, right? So we already have all the fixed-cost already in-built in our P&L today. So it’s all about adding value, going deeper and farming our existing clients.
Sameer Dosani
Okay, okay. Okay. And we are seeing decline in transportation mobility business in Q4, I think, when I look at your data. So from here on, it will stabilize, do you think?.
Jigar Mehta
So again, I clarified earlier, Sameer. So basically the entire trend was from a Tier-1 business, right, right?
Sameer Dosani
Okay.
Jigar Mehta
And what we have done is when we say budgeting for this year, it’s always done on Q4 run-rate, right, March run-rate for services.
Sameer Dosani
Correct. Correct.
Jigar Mehta
So it’s already budgeted from that perspective and we kept it whatever the numbers in March were. And in some places remain lower than that. If you know we want to exit or move-out from that client.
Sameer Dosani
Okay. And my last question is, so Tier-1 is now a very small part of our business, like how big is it or?
Jigar Mehta
No, no, it’s still very sizable. I think it’s about 40%, 35%, 40%. And as I said, my dream, my vision, my goal is taking this INR180 crore TNM business to INR1,000 crores. And I think it’s possible because we already have the best clients. And we’ve already hired an amazing young leader and now I just want to give him three to six months-to put the whole strategy in-place, the new organization structure, because I think then we can go out and start hiring and building up the global base that we can differentiate as well in the market.
Sameer Dosani
Yeah. Sorry, INR180 crores is a Tier-1 business. Sorry,
Jigar Mehta
T&M, T&M, transportation and mobility business, the whole
Sameer Dosani
Got it.
Jigar Mehta
It’s 13 plus crore.
Sameer Dosani
Got it.
Jigar Mehta
And our goal — we have pretty ambitious goal, we just have to make sure we put the org structure in-place. Now we’ve got the leader in-place. Now he has to put the whole execution model in-place and the strategy in-place and that’s what I think will happen in the next three to six months. Post that, we are very happy to do our analyst meeting and share that with you guys as well because we want to differentiate the market. We want to do those other three automotive companies do. We’ll come up with our own niche strategy, which can help us scale and that’s what we are working on.
Sameer Dosani
Great to hear that. And last question is like current scheme in the market is, you know in times of difficulty, these OEMs and customers of ours who try to consolidate vendors. So how are you thinking about is there some places you’re losing, some places you are winning any thoughts on that and how is it factored in our strategy and in our guidance/numbers for next year? Thanks.
Jigar Mehta
Again, great question, Sameer, as we’ve discussed this before as well. For us as a young company, especially post the pandemic, we’ve gone from literally INR0 crore to INR500 crores of revenue. So for us, it’s a beautiful run. So for we are only celebrating in-house. Now where are we celebrating and why did onboard win is obviously because there was continuously vendor consolidation or vendor evaluation from the large global multinationals in US and Europe. And that’s where onward technologies really wins.
So we’ve always been that our backs have always been against the ball. We’ve always been alert towards that. And I do believe that’s the reason one of the key things that we are trying to focus on our strategy is winning 10 customers. And when we say that and the objective of saying that is not just that we want to scale with existing customers. It’s also a reality chip for us and we cannot win every battle. So we have 80 customers onward us to win in 10.
So there’s vendor consolidation, there are still 80 customers that we already have. We have to only win 10 to get to our first milestone. Right. So we will win in some places, we will lose in some places. So-far, it’s only been positive for us last 4.5 years. And I hope we can keep doing what we are doing and keep building a young mobile, agile, flexible team-based on our values, I think we will be fine.
Sameer Dosani
Okay. Got it. And lastly, our growth would be back-ended, like H2 would be heavier, like H1, we would expect us to have softer growth or you think it will be evenly distributed?
Jigar Mehta
I think we should grow quarter-on-quarter this year. I think, as I said, we’ve done budgeting very differently, taking a lot of assumptions into place. So we’ve done very conservative budgeting is what, again, what I like to believe. We have much bigger ambitions, but a lot of things have to fall in-place, especially the external parameters.
Sameer Dosani
Sure, sure. Sure, sure. I hope our assumptions include like environment to stay-in the same manner, not expecting an improvement on the basis of which we are building them. So that — if that is true, then this will surely help our company. All right. Thank you. Thanks,, and thank you for appreciately answering all the questions. Thanks.
Jigar Mehta
Thanks.
Operator
Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. The next question comes from the line of Sandeep, an investor. Please go-ahead.
Unidentified Participant
Yeah. Hi, Jigar. Congratulations on a good set of numbers. So I see that there is a INR2 crore decrease in the other expenses compared to Q3 of this year and Q4 of last year. Can you throw some light on that? Hello, am I audible?
Jigar Mehta
Yes. Yes, yes. Other expenses, other expenses are predominantly travel and I think Buzzy software outsourcing or subcontracting. I can’t get you the exact numbers, details, Sandeep, if you can reach-out to ENY, they can give you all the breakup. It’s linked directly to the — probably it’s only two components in other expenses, right? That’s software outsourcing, subcontracting that We do for commodity work and second is travel. There’s nothing much which comes into other expenses in a service company. So that’s where the reduction might be.
Unidentified Participant
Okay, okay. And very happy to hear a positive tone and hopefully we see very good numbers in the next few quarters. Thank you all the best.
Jigar Mehta
Thank you.
Operator
Thank you. Thank you. The next question comes from the line of Shriram Rajan, an investor. Please go-ahead.
Unidentified Participant
Yes, sir. Hi, Jugar. Just a clarity. When you say you have 80 clients and you just need to win 10 of them. So the 80 is — are the customers with whom onward has MSA and you need to bid for 10 every quarter. Is that what you meant or it is that you need to win 10 for the year?
Jigar Mehta
Yes, hi. So yeah, I don’t mean any of that. There are 80 customers that we have an active engagement with for probably a year, if some of them have been as high as 10 to 15 years. So in those 80 clients, right, every day is more because every day you’re talking about you’re delivering projects, you’re bidding for new RFPs, customers asking you to invest in new areas, you are betting on new areas.
So what we are seeing is in the 80 customers out of 80, let’s say, 70 of them are 75 are in the two large verticals that we are present in, we will win 10 of them, which will scale much faster, right? So we have two clients now above one client, about 10 million, another client crossed 5 million. We have multiple other clients, which will start crossing $3 million to $5 million. So that’s how the journey will be.
Unidentified Participant
Okay. And
Jigar Mehta
Then the goal is as we keep scaling up, we start hopefully bidding for multi-million dollar deals and which will help us grow even faster or get to our mission even faster.
Unidentified Participant
Okay. And if you look at the quarterly run-rate of about, say, let’s say, INR120 crores, does it come from your top-10 customers itself, 80%, 90% of it?
Jigar Mehta
Correct. Correct. I think we have given the exact breakup
Unidentified Participant
In the breakup. I’m sorry, I’m just taking it on the moment. I haven’t seen the deck. I will go through. The deck, I’ll go through.
Jigar Mehta
Yeah, we share all that data. Everything is out there.
Unidentified Participant
Yes, yes, you do. You doing that
Jigar Mehta
Inflation as well. I remember, Sriram, you had asked me a couple of quarters back about attrition. I think you shared LTM attrition data as well.
Unidentified Participant
Yes,
Jigar Mehta
I think it’s about 13% or something.
Unidentified Participant
I’ll see it, Jagar, I haven’t gone through it. There’s this question I’ve asked a few times in the past, but I think we see the pinch in the market where the archital intelligence and LLMs kind of taking away 20% 25% of routine tasks. So if you look at your digital side of the business and if you call Count cloud inside it and some of the other businesses this can be actually commoditized and pushed to a robo. Do you think there is some chance of some of the business falling off oh
Jigar Mehta
Absolutely. I am a big fan of AI and I think so is my entire team and I think there will all the low-end commodity work will disappear. I think all of us are using it extensively for everything that we do and that creates opportunities for us to upskill and move from low-value work to high-value work because we have the team already, right? That’s the best part about my job in onboard and I shared that in my opening remarks.
When we were INR250 crores, we were 2,500 people. We have INR500 crores now, we have 2,500 people. So we’ve really gone up the value chain in lot of areas. And there’s still skies a limit for onboard and where we can go right in terms of I think for the same 2,500 employees, I think I’m sure we can do double or triple the revenue. That’s not going to happen, but that’s something possible.
Unidentified Participant
Understood.
Jigar Mehta
So to answer your question, absolutely. I think AI will take-away a lot of the low-end commodity work and help move-up — help move the whole organization or the industry to higher-end work.
Unidentified Participant
Yeah, understood. That’s clear,. I think so you’re prepared for it. So that was the point. So terrific. All the best. Thank you.
Jigar Mehta
Thank you.
Operator
Thank you. The next question comes from the line of Harsha, an investor. Please go-ahead.
Unidentified Participant
Yeah. Hi, are you able to hear me?
Operator
Yeah. Shah, please go-ahead.
Unidentified Participant
Yeah. Hi, thanks for taking my question. I just had a couple of questions. First one is on the pipeline, right? So, I mean, have you seen any improvement in your pipeline in the last 10, 15 days? Are you — are you seeing any trend there, which is kind of improving compared to where it was last year that is giving you confidence on your outlook for this year
Jigar Mehta
Harsher, hi. Last 10, 15 days is too short in the engineering industry for us the pipeline or the visit — the budgeting that we have done for this year is based on the pipeline we had six months back. Right. So in Q3 of last year is what the pipeline because we have bid further projects in Q3, we expect to win in Q1 or Q2, then the execution happens and that’s what we add-in our projections. So even if something pops up today or suddenly world changes today, I don’t think our numbers will have a big impact.
On the automotive side of the business, that’s one small portion where we’ve taken flat revenue as an assumption, a very low assumption. There, there could be a potential uptick because when automotive business grows, they want substantially large number of people in US and Europe. And for the first time, Onver Technologies is ready with the Visas and the execution engine and everything else that goes with it. So that uptick comes, I think we will be ready and I think we will see much bigger growth potentially than what we are projecting right now.
Unidentified Participant
Understood. So essentially, you know your growth targets for this year are set on what’s already in the pipeline. It’s not basically assuming any new deals that are likely to come. But how are the deal ramp-down conversations taking place triggered? I mean, you did highlight about some ramp-downs last year, are they behind us now completely? You know, how are the conversations with clients trending now? I mean, do you believe that most of the things that are in pipeline will actually be executed and converted into actual orders and revenue ramp-ups?
Jigar Mehta
Two questions. To answer your first question, how are the conversations with customers, I don’t think it’s much of a conversation. OEMs decided to bring in-source work. When they in-source work, they cut-off the Tier-1s. So onward technologies works, used to work both. We predominantly work with OEMs and then we also — we primarily work with OEMs and secondary Tier-1s. So the OEMs decided last year because of all the factors, they will in-source all the work from Tier-1s.
So suddenly Tier-1 work dried out, which they were outsourcing to companies like onboard and all other automotive engineering companies in India, at least we took a big hit there. I think most companies I know to come back. OEM work, work increased because they continuously invested in innovation and R&D and that work increased for us and for everybody else. So the OEM part of the business is strong, consistent and I think will keep growing.
The Tier-1 business is where the challenge is. Just to answer your question, right. Was there something else that you were leading to?
Unidentified Participant
Yeah. I also had query on the ramp-downs, deal ramp-downs or cancellations, things like that. Are they kind of now normalized and things are looking good now?
Jigar Mehta
We haven’t seen anything this year so-far. This all happened in Q2 and Q3 of last year. We haven’t seen any deal ramp-down or any other conversation from customers. Actually, most companies in US, in particular are in wait-and-watch mode right now, right? They want to see where the government plays out, what happens. So we have not seen any substantial positive conversations or negative conversations. But I think everybody is anxious, everybody is sitting on a lot of cash.
So I think — and everybody has to come out with great products. So I think as soon as there’s stability in the external parameters, I think you will see a huge uptick. We all like to believe there’ll be a huge uptick again that we saw post the pandemic.
Unidentified Participant
Understood. Thanks. I just had one final question on your utility
Jigar Mehta
Are you on my? I think we lost him.
Operator
Harsha, could you please unmute your line since there is no response, we’ll move on to the next question. Ladies and gentlemen, a reminder, if you wish to ask a question, please press star and 1. The next question comes from the line of Parth Damani from Tirupati Equity. Please go-ahead.
Parth Damani
Yes. My question was regarding the new leader, which you have appointed in the transportation segment. So is it — you have hired it from KPIT — from KPIT
Jigar Mehta
Part we have multiple new leaders. We will share a lot more details. It’s all available on LinkedIn but we would like the new team to settle down in their new roles and we’re happy to introduce you to them. It’s not relevant where they came from, it’s more the experience I was looking for.
Parth Damani
Okay. Okay. And any outlook about your margin like can it improve to a little more higher teens because other companies in this operating in this segment like in this field is are little — having a 16%, 17%, 18% margin. So just want to know about your outlook on margin..
Jigar Mehta
As said earlier, we are very comfortable. I think this year, we should be able to deliver and we will deliver double-digit EBITDA margin competitively. How high it can go and execute, try and do a good job and hopefully we can surprise all of you guys or make you guys happy. It’s very hard to say because there’s so many external parameters that we don’t know today.
Parth Damani
Okay, okay. Thank you. Thank you. Thank you.
Jigar Mehta
Thanks.
Operator
Thank. Ladies and gentlemen, if you wish to ask a question, please press star and 1. As there are no further questions, I now hand the conference back to Mehta for his closing comments.
Jigar Mehta
Great. Thank you. Again, thank you for joining us today on a Friday evening. It’s a pleasure to speak to you all-the-time and I look-forward to delivering a better year and keeping in touch with all of you. Thank you and have a great weekend.
Operator
Thank you, sir. On behalf of Onward Technologies Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines