Ramco Systems Ltd Q3 FY23 Earnings Conference Call Insights

Key highlights from Ramco Systems Ltd (RAMCOSYS) Q3 FY23 Earnings Concall

Management Update:

• [00:03:45] RAMCOSYS said the company recorded its highest ever bookings in eight quarters for 3Q23.

• [00:05:53] RAMCOSYS’ attrition came down by 6 percentage on a TTM basis, with the trend declining.

Q&A Highlights:

• [00:09:26] Vivek Turaga from Bestpals Research asked about the sustainability of booking given the macro environment. P.R.Venketrama Raja MD replied that bookings are growing and pipeline are getting converted in a healthy rate. RAMCO expects the momentum to continue.

• [00:15:20] Sujana enquired about the total unexecuted order book in 3Q23 and pipeline orders. P.R.Venketrama Raja MD replied that it was 191 million and pipeline orders is 600 million.

• [00:26:28] Rohit Balakrishnan of ithought PMS enquired by when the company thinks it would become profitable from a P&L point of view. R Ravi Kula CFO replied that the company is working on strengthening activity and it should start showing the results. Also the immediate target is to be cash neutral than becoming profitable from a P&L point of view.

• [00:29:24] Rohit Balakrishnan of ithought PMS asked about the progress of going live in a lot of the western world. P.R.Venketrama Raja MD answered that in 3Q23 the company had seven more countries certified in the Workday and that progress is continuing.

• [00:31:39] Rohit Balakrishnan of ithought PMS enquired about the problems in the Asian markets and the situation now. P.R.Venketrama Raja MD replied that major business is from Asia Pacific and out of 27.56 million, around 15 million is coming from there. Also there is good pipeline and deals moving in Asia and all geographies excluding Greater China and Hong Kong.

• [00:33:22] Dhruvesh Sanghvi with Prospero Tree queried about the overall cost rising of different heads considering RAMCO’s plans materializes in the next 24 months. P.R.Venketrama Raja MD clarified that the company is expecting cost rise only mostly in the sales and market facing role. However, not much raise is expected as RAMCO has invested in automation.

• [00:35:50] Dhruvesh Sanghvi with Prospero Tree asked about the write-offs that are non-cash but coming in expense for nine months FY23. P.R.Venketrama Raja MD said that it’s $6 million.

• [00:37:29] Dhruvesh Sanghvi with Prospero Tree enquired about the search progress for a new CEO. P.R.Venketrama Raja MD answered that the team is executing well and things are stabilizing. Therefore, the company is not looking at a CEO currently.

• [00:38:37] Rahil Shah asked about revenue and margin outlook for 4Q23 and FY24. P.R.Venketrama Raja MD replied that 4Q23 and FY24 is looking promising from a order booking perspective and good traction can be seen. So revenue and margin for 4Q23 can be seen in the similar lines of 3Q23.

• [00:56:39] Rohit Balakrishnan of ithought PMS asked about the mix of business 2-3 years from now. P.R.Venketrama Raja MD answered that aviation and HRP were doubled at the beginning of the year and it’s firing on all cylinders. Post that, ERP will be done which will see an uptick sooner.