Quick Heal Technologies Limited Q4 FY22 Earnings Conference Call Insights

Key highlights from Quick Heal Technologies Limited (QUICKHEAL) Q4 FY22 Earnings Concall

Management Update:

• QUICKHEAL stated that FY22 has been a year of investments for future growth. The company invested more than 50% of its revenues towards R&D and sales and marketing program with an increase of around 30% on a Y-o-Y basis.

Q&A Highlights:

• Rushank Modi asked about attrition and how QUICKHEAL is handling the issue with rise in employee cost. Sanjay Katkar CTO said that the company’s attrition rate of 29% has gone up vs. previous year and is taking all the measures to retain the existing strength and create more engagement among the R&D engineers.

• Rushank Modi enquired about the Seqrite outlook for the next 3-5 years. Sanjay Katkar CTO replied that QUICKHEAL is having most of its new investment focus on the enterprise segment. And Seqrite is having good plan for marketing and sales. So the plan is to increase the revenue pie from Seqrite to at least 50% in next 3-4 years.

• Rushank Modi also asked how QUICKHEAL is planning to increase the share of revenues from outside of India. Kailash Katkar MD replied that for consumer products from outside market, QUICKHELA is focusing on e-commerce platforms like Amazon.

• Sanjay Awatramani of Envision Capital asked if the company is going to diversify to products other than cyber security. Kailash Katkar MD clarified that QUICKHEAL is cyber security experts and there is lot many things to do in cyber security itself. So the company is not going to diversify its business.

• Sanjay Awatramani of Envision Capital asked about the geographies the company is focusing on. Kailash Katkar MD answered that QUCKHEAL would like to take its products and solutions to countries like South Africa, African countries, Southeast Asia, and some of the European countries.

• Sanjay Awatramani of Envision Capital asked about revenues or EBITDA margin guidance for FY23. Sanjay Katkar MD said the company can’t give any guidance but QUICKHEAL is very much confident about its new products and solutions and expects these products to definitely generate good revenue in coming years.

• Dhwanil Desai Turtle Capital asked if the run rate of R&D and S&M cost constituting almost 50% of revenue for FY22 would continue going forward.  Navin Sharma CFO replied that these costs will be higher but at the same time will make sure that EBITDA is in the range of 30-32% on a full year basis.

• Rajeev Pandya enquired about the margin outlook for Enterprise business and retail business for FY23. Navin Sharma CFO answered that in the retail business for FY23, QUICKHEAL would be growing at lower single-digit and enterprise business should be growing at higher double-digit.