Unicommerce eSolutions Ltd (NSE: UNIECOM) Q1 2026 Earnings Call dated Aug. 13, 2025
Corporate Participants:
Unidentified Speaker
Kapil Makhija — Managing Director & Chief Executive Officer
Anurag Mittal — Chief Financial Officer
Analysts:
Unidentified Participant
Mridul Goenka — Analyst
Arvind Arora — Analyst
Shreyansh Gattani — Analyst
Presentation:
operator
Sa.
operator
Ladies and gentlemen, good day and welcome to Unicommerce eSolutions Limited Q1FY26 earnings conference call. This conference call may contain forward looking statements about the company which are based on beliefs, opinions and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve risk and uncertainties that are difficult to predict. As a reminder, all participant lines will be 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 this conference call, please signal an operator by pressing Star then zero on your touchdown phone.
Please note that this conference is being recorded. I now hand the conference over to Mr. Kapil Makhija, Managing Director and CEO of Unicom E Solutions Ltd. Thank you. And over to you sir.
Kapil Makhija — Managing Director & Chief Executive Officer
Thank you. Hello and good morning everyone. Thank you for joining us. Before we begin, I am pleased to share an important milestone. Today marks the first anniversary of unicommerce as a publicly listed company. This past year has been a learning journey for our team with disciplined execution driving consistent growth in revenues and profits as we embrace the opportunities and the responsibilities of being a listed entity. We are pleased to welcome everyone to the quarter. One FY26 earnings call of Uni Commerce E Solutions Ltd. Joining me today is Anurag Mittal our our CFO along with strategic growth advisor, our investor relations advisor.
Q1FY26 mark a strong start to the financial year reflecting strong execution across revenue growth, profitability and key strategic initiatives. The quarter demonstrated our ability to scale sustainably while continuing to enhance our product offerings across all our platforms. For the benefit of new participants on the call, let me briefly outline our comprehensive product offerings across three platforms that make us a one stop shop for all e commerce enablement needs. First, Convertway it is an AI enabled marketing automation platform designed to improve conversion rates and sales performance on client websites. Second, Uniware IT is our flagship post purchase supply chain management platform widely trusted by e commerce businesses to manage inventory orders, warehouse and omni channel operations and third, Shipway IT is our logistics technology platform offering two core solutions Courier Aggregation for clients seeking to manage deliveries through multiple logistics providers via a unified interface along with shipping automation for clients using their own courier relationships but requiring advanced tools to optimize daily logistics execution.
Together, these platforms create a comprehensive solution covering the full E commerce life cycle, from driving demand to managing operations to handling delivery and return. Talking about our financial performance, Our Consolidated revenue reached 449.3 million rupees in quarter one FY26, a 63.6% year over year increase. Adjusted EBITDA, which reflects our operating profitability, grew 112% year over year to 94.7 million rupees driven by consistent cost discipline and strong operating leverage. Adjusted EBITDA margins improved from 16.3% in Q1FY25 to 21.1% in Q1FY26. These results reflect the resilience of our business model supported by disciplined cost management and improved operational efficiency.
Let me now highlight some of the strategic milestones we achieved during the quarter. First, our international business spanning six countries outside of India turned operationally profitable in quarter one FY26, marking a key milestone in our global expansion journey. This was driven by a cost effective delivery model leveraging our established onboarding and support teams in India, which has enabled us to maintain a lean cost structure along with a consistent addition of overseas clients contributing to steady revenue growth. Over the past year, we have worked closely with a large retail conglomerate in the Middle east to support several of their retail businesses, and in quarter one FY26 we secured a sizable contract in Southeast Asia, further strengthening our presence in the region.
Second, we also commercially launched our payment reconciliation module unireco, which enables sellers to streamline their receivables from E commerce platforms and identify potential financial leakages. Third, Univer, our flagship platform, achieved an annual transaction run rate of over 1 billion order items during the quarter, at par with the festive season quarter of FY25, indicating consistent growth in volumes managed through our platform. Fourth, Shipway became pat positive during the quarter, now coming to industry performance while sector wide growth remained subdued in quarter one FY26, we remain focused on executing multiple initiatives within our control to drive consistent growth in revenues and profitability independent of broader market conditions.
First, we introduced several product announcements on Uniware, including Blynk Mode for faster processing of high volume workflows, multilingual support for invoices and labels, and feature upgrade for B2B and quick commerce order management. In quarter one FY26, we reached an annualized run rate of 48 million items for quick commerce channels compared to 20 million items in FY25. Second, as highlighted earlier, we commercially launched our payment reconciliation module Unireco whose initial feedback by early adopting clients has been positive. And third, we continue to focus on adding new clients with 88 new clients acquired in Q1 FY26 as we continue to see strong sales momentum.
Select additions this quarter include traditional as well as digital first brands such as Ajanta Shoes, Himalaya Wellness, Rupa, lacosse, Richlook, Super U Beyond Snack and Eat Better Company. Turning to shipwreight, it continued to see a strong adoption from new and existing customers. In line with our profitability focus, we also reviewed and restructured select low margin accounts which resulted in a marginal decline in revenue but contributed to shippay becoming pat positive during the quarter. However, the constant growth in the business had ensured that as of July ship pay has already reached the highest ever annualized run rate of INR 80 to 85 crore compared to approximately INR 70 crore revenue in Quarter 1 FY26.
Product enhancements during the quarter included launch of an AI powered chatbot Loka to help brands get instant resolutions for post purchase issues like shipment tracking, delivery delays without human intervention, along with improving user experience and expanding system integration. Convertway progressed steadily with feature additions aimed at enhancing WhatsApp message deliverability and enabling multi agent functionality in the customer support module. In addition, we continue to embed AI across key operational functions including code development, ticket resolution and client support, helping drive productivity and improve service outcomes. In summary, disciplined execution in Quarter 1 FY26 has enabled us to maintain operational performance while continuing to invest in long term platform strength.
Looking ahead, we see multiple structural tailwinds supporting our growth trajectory. First, India’s underpenetrated E commerce market which presents significant headroom for long term expansion. Second, a large and growing total addressable market of over US$1.15 billion with notable opportunities in areas like courier aggregation through shipwreck. Third, consistent new client acquisitions across all platforms complemented by effective cross selling to existing clients, introduction of new use cases and platform enhancements that unlock additional revenue streams and fourth, continued growth in our international business which is further diversifying our revenue base and expanding our overseas footprint. As we progress through FY26, our priorities remain firmly centered on disciplined execution, deepening our client engagement and continuously enhancing our platform capabilities.
Backed by a strong foundation comprising our integrated offerings across Convertway, Uniware and Chipway and a large and growing client base of over 7,000 businesses, we are well placed to strengthen our leadership in the E Commerce enablement ecosystem and unlock the next phase of sustainable growth. Now I’d like to invite Anurag Mittal, our CFO to share our financial performance. Over to you Anurag.
Anurag Mittal — Chief Financial Officer
Thank you Kapil. Good morning everyone. Quarter one FY26 marked a strong start. To the fiscal year reflecting both top. Line momentum and continued improvement in operating profitability. Our consolidated revenue stood at 449.3 million representing a 63.6% year over year increase. Revenue growth during the quarter was supported not only by the continued scale of Uniware but also addition of Shipways business. Adjusted EBITDA grew by 112% year over year to INR 94.7 million with margins expanding from 16.3% in Quarter 1 FY25 to 21.1% in Quarter 1 FY26, an increase of 482 basis points. The improvement in profitability reflects are continued focus on cost discipline, operating leverage from Univair and operating profitability of shipway. Profit after tax rose to 38.9 million reflecting a growth of 10.8% YoY.
The variance between BAD and adjusted EBITDA growth is attributable to a non cash amortization expense of 33.2 million related to intangible assets recognized from the acquisition of. Shipway Technology Private Limited. Excluding this non cash expense paid for the quarter would have been 63.7 million representing a year over year increase of 81.5%. EPS increased by 10.4% YoY to INR 0.34 in Quarter 1 FY26 compared to INR 0.31 in Quarter 1 FY25. ROE increased by 140 basis points to 20.7% in Quarter 1 FY26 compared to 19.3% in Quarter 1 FY25. ROCE increased by 550 basis points to 23.9% in Quarter 1 FY26 compared To 18.4% in Quarter 1 FY25. Shipware technology delivered consistent revenue performance during the quarter. As Kapil mentioned earlier, a planned review of low margin accounts was undertaken to enhance profitability resulting in a marginal and a temporary impact of revenue.
Encouragingly, Shipways arrangement as of July has already exceeded around 80. 85 crore in July up from approximately 70 crore in quarter one FY26 demonstrating a rebound and strong underlying momentum. The synergies and cross sell opportunities across our platform have materialized well in a short time and we remain optimistic about continued progress to Summarize our performance. This quarter underscores the strength of our operating model and our ability to grow efficiently as we continue to strengthen relationships with existing clients, acquire new account and invest in platform enhancement to unlock incremental revenue opportunities. Our focus remains on financial discipline and delivering sustainable, profitable growth.
Further, we are pleased to announce the successful implementation of Oracle as our financial ERP platform during the quarter. This strategic move significantly strengthens our internal systems, processes and controls, laying a robust foundation for enhanced financial management. Starting Q2 of FY26, all financial reporting will be transitioned to ERP platform, allowing for greater efficiency, consistency and compliance across our reporting framework. We believe this advancement marks a key milestone in our commitment to operational excellence and financial transparency. With that, I would now like to open the floor for Q and A. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on the touch on telephone. If you wish to remove yourself from the question queue you may press STAR and two Participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. Participants who wish to ask questions may press star and one at this time. The first question is from the line of Mrithul Goenka from clsa. Please go ahead.
Mridul Goenka
Yeah hi, thanks for the opportunity. Am I audible?
Kapil Makhija
Yes Sumit, you are audible.
Mridul Goenka
Yeah, hi, yeah, thanks for the opportunity. Sadly three, four questions I had. So firstly I think on the pricing in the standalone union, I think that needs to remain subdued. Now it is below 1 rupee 10% and down 60% worldwide. So can you just briefly comment us. To.
operator
Mr. Mirthul, may we request you use a headset to ask a question? Your line is not clear.
Mridul Goenka
Hello, am I audible now?
operator
Hello, please go ahead.
Mridul Goenka
Yeah, hi, actually first question is on pricing. Can you comment like what are the reasons for pricing to be soft in this quarter?
Kapil Makhija
So as we had mentioned in the last quarter earning calls as well that in FY25 we had made a deliberate investment to actually adoption by offering lower minimum guarantees to select clients. And if you recall that in the initial period the effective rate from these new clients usually tend to be higher as we were charging a higher mg. But now to accelerate adoption with new age brands we had taken a strategic call to lower these mgs to make it more affordable for these new age brands. The second is that in this earnings call we have also mentioned that we have seen a rapid rise of quick commerce volumes getting managed.
So both the share of B2B and quick commerce volumes in our transaction mix has also increased and these transactions, given their bulk nature, generally realize lower transaction rates. But this is too early for us to say as in the relative mix of the B2B and quick commerce transactions will stabilize in due course of time. So we will be able to comment on a steady state rate in subsequent quarters. But as of now I would say that it’s been in the similar ballpark of 1.1 as we had mentioned 1.1 to 1.2 due to some of these initiatives that we’ve taken in FY25 and slight increase.
A larger increase in our quick commerce and B2B volumes are immediate focus areas has resulted in a slight decline that you’ve observed.
Mridul Goenka
Got it. That’s helped prodding further on that line, can you briefly comment out of your overall business, how much is the contribution from Quick Commerce and what is the differential between pricing for Quick Commerce clients versus your regular clients?
Kapil Makhija
See the. Like I said, it’s very early days for us, so we are seeing good adoption of Quick Commerce and B2B amongst our client base. I think it’s hard. It’s early days for us to comment. The steady state contribution of or the share of Quick Commerce overall volume and the rate for Quick Commerce vis a vis B2C is business sensitive. I think it’ll be difficult for me to share that.
Mridul Goenka
Okay. Not. Not an issue. So maybe I think the next question is. I mean I can.
Kapil Makhija
Sorry.
Mridul Goenka
Hello. Am I. Am I audible now? Hello?
Kapil Makhija
Yeah. Yeah. You’re audible now. Yeah.
Mridul Goenka
Yeah. Okay. Okay. Yeah. So actually I wanted to know your top 10 client revenue proportion that has been completely shrinking, I mean for the last several quarters. But it was decent to see some growth on a yoy basis. So can you just comment like are you incrementally gaining more wallet share within your top 10 clients or is it. There’s a huge churn in the top 10 clients. Just wanted to get a sense as to how your top customers are going along with you.
Kapil Makhija
Sure. Sumit. I’m assuming this is for the standalone business as I recall. So as you would recall we had mentioned that as far as uniware is concerned, we have 100% wallet share because a brand uses a single OMF for their operations. So there is no question of wallet share. As far as our standalone uniwear business is concerned, the overall related share of top 10 clients has been consistently declining, which is a result of our focused effort in diversifying our client base. We have seen a steady growth in the number of clients using our platform. And we have seen both traditional brands as well as digital first brand using our platform steadily growing as the E commerce market grows.
So the relative share decline of top 10 clients is a focus is a result of our focused effort in accelerating our client base and diversifying it further.
Mridul Goenka
Got it. But I think, I think on absolute basis Also your top 10 clients revenues have come down by almost 2850% on a Y basis. So what is the reason for the absolute revenue shrinkage?
Kapil Makhija
I think it’s a function of other also growing. Like I stated, our client base has increased. So it’s the related share has come down because our broader base continues to increase and we continue to see a strong acceleration of new clients getting added to our customer base.
Mridul Goenka
Right, I get that point, but my point is your top 10 clients must be growing, right? Given that E commerce is still growing in double digits as an industry. So in terms of your transaction volumes will then they should also see a double digit growth. I’m not sure about the pricing so that’s where I wanted to prod further like how your top 10 clients are positioned and grow on an absolute basis.
Kapil Makhija
So the top 10 clients, given that we manage 100% of their dropship volumes, top 10 clients have grown in line with the market growth. I can confirm on this call that there have been no local churn Amongst the top 10 customers.
Mridul Goenka
Okay, got it. And finally on Shipway I think you mentioned that there was some planned pruning of our non profitable accounts and on a yu y basis I guess your growth was close to 20%. If I’m not wrong.
Kapil Makhija
By our basis we do not have the shipyard number because we started consolidating it from 17 December when the first branch was completed on a quarter. On quarter basis there has been a slight decline because of the reasons that we had mentioned that we have restricted some of the select low margin accounts to ensure that Shipway becomes fat positive. But we have the business continues to grow month on month and has shown consistent growth because of which our July revenue is 80 to 85 crore which is our highest ever for shipwrecke compared to 70 crore revenue in quarter 1 FY26.
Mridul Goenka
Got it, got it. So what is the organic potential for Shipway business going forward?
Kapil Makhija
See, Shipway operates in a large tank of nearly 4,000 crore. So I think there’s significant headroom for growth. I think the journey has just started and Shipway can continue to tap into this large customer base of social media sellers brands selling on their own website. So while there is a large pool of e commerce customers, there is a large market even outside of universe customer base where Shippe can continue target. I think the journey has just started and we feel that this can continue to grow aggressively. In fact as we consistently maintain that all our new products are engines of growth including Shipway, Convertway and Unireco Amongst that Chipway is expected to be the largest ever of growth for us from these new products.
Anurag Mittal
And Sumit, in addition to what Saprik mentioned, I also mentioned in my speech that our growth momentum continued in July as well which really demonstrates what we are seeing in fact with the shipwrecked ARR increasing to highest ever ARR of 8085 crore compared to 70 crore in quarter one FY26 itself. So there is definitely a significant potential for shipwreck in the logistic market and we are quite positive about the future potential of shipweight.
Mridul Goenka
Got it, got it. So would it be fair to assume that the growth in Shipway would be higher than your standalone business given the potential what you mentioned?
Kapil Makhija
Yes. See Univer is a stable platform. It’s been matured built over more than a decade. So the standalone business will continue journey of marketplaces growth shipping. Given the large climate operates in and it’s relatively newer entrant in this space, we feel that the growth potential of Shiptrain is far higher than the standalone.
Mridul Goenka
Got it, got it. That’s all the questions I had. Thanks for the opportunity.
operator
Thank you. The next question is from the line of Arvind Arora from A Square Capital. Please go ahead.
Arvind Arora
Hello. Am I audible?
Kapil Makhija
Yes.
Arvind Arora
Yeah Good morning Kapil and team and congrats on good set of number. So Kapil my first question on profitability level at Uniware product. So despite the revenue is played our paid has grown. So could you please throw some light where we worked worked on to improve the operational efficiency and how it looks like will this sustain or like that would be a deep or something like that.
Kapil Makhija
As I mentioned earlier as well that Univer platform is fairly stable. We built it over a decade now. So we have realigned our investments in the platform to align with the requirements of the platform because of which we see strong operating leverage in the business. We have realigned our investments essentially related to people’s costs because now with the help of AI we are able to do things a lot faster than what we could do a year ago. Because of it we’ve been able to build a lot of people related efficiencies and you would see a material decline in our people cost on the title loan business as and the business inherently has had an operating leverage.
We have demonstrated it over the last few quarters already. But we’ve been able to take it even further by building internal efficiencies thanks to AI for not only product development but even other areas like client support, customer success, etc. Because of which we are seeing a significant improvement in the cost base resulting in improvement of our partner.
Arvind Arora
So Kapil then paid margin. Sorry. Yeah.
Anurag Mittal
So in addition to what Kapil also mentioned, I also wanted to call out that our flagship needs to be a platform is very mature now and stable product requiring minimum, minimum incremental investment now. And as a result we have further improved our profitability through disciplined cost management and our use of AI Anyways and this has enabled us to realign our manpower cost to the level of appropriate investment and definitely Univair continues to drive expanding profitability for us.
Arvind Arora
So is it like this paid margin may improve further from here as well?
Anurag Mittal
Definitely.
Arvind Arora
Okay. And so if I look at Univer, our volume growth is year on year is 19%. Correct. And if I look at customer addition side, so last year our customer was 855 and it increased to 979. So there is a net, net 14% growth in the customer edition. So this growth is coming from customer edition or how it is like how we should look at these operational metrics.
Kapil Makhija
Yeah. So our growth is a function of multiple factors. One is the market growth, our existing clients because we charge for transaction. So as our existing clients grow in line with the market growth, we stand to gain from that. The second lever of growth for us is new client additions. The third lever is new products or like we have just recently commercially launched Uni repo. So we are able to upsell and cross sell our existing customer base on these new products. And fourth is international expansion. We continue to add new logos in in the international markets as well.
So our growth is driven by a combination of these four factors. Hope that answers the question.
Arvind Arora
But then at a customer level our rate or charges will not increase. Is it like that?
Kapil Makhija
Yes. So first of all I wanted one clarify on the transactions growth. A lot of our transactions growth is driven by new customers getting added. And we charge a minimum guarantee from these enterprise customers in which we bundle certain number of transactions in this cost. As the new customers start using the platform, a lot of this transaction growth gets subsumed in the minimum guarantee that these new clients pay us because of which the transaction Growth doesn’t translate into the revenue growth always. And secondly I think Sumit before you had asked a question on the rate rate continues to be in a similar ballpar of 1.1 and so hence our revenue growth is a result of the four factors that I mentioned.
But the transaction growth in absolute cannot translate into revenue growth because bulk of this transaction growth gets consumed in the minimum guarantee that the new clients are paying us.
Arvind Arora
Okay and Kapil, what is overlap as of now or is there any headroom now? Sorry, what is what is overload overlap as of now? Since last quarter we discussed like we we can also get the client from Siphway acquisition and there were there was overlap of 13 if I’m correct. So what is status there and are we whatever client that we are seeing as new acquisition is is it coming through Shipway acquisition or how it is.
Kapil Makhija
Sure, I think I just want to clarify that in the last quarter’s earnings call we mentioned that the overlap had crossed 10%. Our overlap continues to be in a similar ballpark of 10% which we had reported in the last quarter in terms of universe client acquisition. The levers for client acquisition for Univer is a mix of outbound sales engine where the team is reaching out to various prospects, qualifying the leads and giving it to the sales team. Second is inbound. We have digital marketing channels as well as we participate in events, both third party events as well as conduct our own events.
We have conducted various e commerce evangelizing initiatives such as ECOMP which is focused on smaller cities. We’ve conducted it in the cities of Surat, Lucknow, Luniana, Jaipur, etc. And the third is partnerships. We continue to foster partnerships with ecosystem players, service providers which help us provide business opportunities. So these three are our G team levers. The cross sell motion largely works for Shipway where we continue to showcase our new solutions including shipway, convertway and unirepo to our existing customers of nearly 7,000 clients.
Arvind Arora
Okay, so is there any update like are we changing or anything we are doing so that our overlap can increase from here or this is the mix where we can go like 10% overlap? No.
Kapil Makhija
So I think the overlap will continue to grow. As we continue to showcase these new products to our existing customer base, more and more customers will start adopting these solutions. But also you have to keep in mind that both businesses are growing in terms of client base. So the overlap percentage will be a function of the common client base divided by the overall client base. Since both numbers are growing, we can’t really comment on how much this overlap percentage will increase but the absolute quantum of client common set of clients which are using both Univare and Chipware continues to increase.
Arvind Arora
So this 88 new client that we have added during the quarter, is it like an organic growth for universe?
Kapil Makhija
Yeah, this is organic growth through the three GTM channels that I mentioned. This is outbound, inbound and partnerships. We can we have added 88 new plans in quarter one FY26 and last.
Arvind Arora
Question Kapil on any update on acquisition part? And as you are seeing we are focusing on one stop solution from E Commerce. Correct. So where we feel we also need to be there in the particular fleet.
Kapil Makhija
As you rightly mentioned, our vision is to become a one stop shop for E Commerce enablement. And in line with that, we continue to explore opportunities and white spaces that can be relevant for the brands we are serving and they continue to be many white spaces that are present because E commerce is a fast evolving industry. So new white spaces keep getting created and in particular in the pre purchase segment where we’ve just got an entry through a solution called Convertway, we see that it’s fairly wide open. So there are many white spaces that continue to be there and we will continue to explore both organic and inorganic expansion to meet our product launches or or strategic acquisitions to be able to serve the E commerce ecosystem being a one stop shop for E Commerce enablement.
Arvind Arora
Any update on the acquisition part or any negotiation that is going at a final stage or something like that? Kapil?
Kapil Makhija
No. So I think we continue to explore, like I said, continue to explore various white spaces and continue to evaluate whether it makes sense to do it organically or inorganically. I think none of those conversations are mature enough for us to be shared with the wider forum today. But whenever we have something concrete, we’ll be happy to share it with the wider forum.
Arvind Arora
Okay. Okay. Thank you. Thank you everyone and all the best for future. Thank you.
operator
Thank you. Participants who wish to ask questions we press char and 1. Now the next question is from the line of Rajiv from Soham Asset Management. Please go ahead.
Unidentified Participant
Hello. Am I audible?
Anurag Mittal
Yeah, yeah.
Unidentified Participant
Hi sir. So basically I wanted to touch upon the organic growth part and the shipwreck part. So first question on that would be so I want to know whether Shipway has some kind of a seasonality on quarterly basis. Also you just. I want to take into account how do I manage the revenues over quarter on quarter basis considering the annual revenue of roughly around 85. So just wanted some color on it.
Kapil Makhija
Sure. So see as Ecom as both Shipwrecker and Uniware operate in the E Commerce ecosystem, E Commerce has got some inherent seasonality where the festive quarters generally tend to be better. But I just also want to highlight that Shipway is a relatively new entrant in the large market space. So there is a huge headroom for growth for Shipwrecker to grow. So I think we will continue to see a consistent in Shipwreck and we may not see the impact of seasonality as much in Shipwrecke because it’s a fast growing business. In a mature business like Uniware you will see impact of seasonality which is because we are serving a large customer base and we are virtually become an index to E Commerce processing more than a billion transactions annually on our platform.
And hence you will see a more profound impact of seasonality on the more mature business which is unique.
Unidentified Participant
Okay. And so considering no seasonality, if I do my numbers and if I exclude the ship pay revenue from it, can can we say that the organic revenue had de growth during the quarter on year on year basis? I’m talking about.
Kapil Makhija
As I mentioned that the growth of the standalone univer business is in line with the market growth. It has not degrown quarter on quarter or year on year basis. It it continues to post a moderate growth but that’s broadly in line with the market growth. As I mentioned that seasonality will have a lot more profound impact on a mature business like Uniware. But having said that, honestly the market growth is something that we cannot control. What’s in our control is where our focus is. We continue to add new clients. We have added 88 new clients across traditional and digital businesses and we continue to launch new products and significantly upgrade the capabilities of our existing product so that we continue to serve the ecosystem.
Unidentified Participant
Got it sir. And so on the capitalization of employee expenses that was done even in this quarter. So I just would like to know your views as in how much is this going to continue in quarters to come. Like you know the absolute number of employee cost is down. I understand that one of the adjustment in there was transfer of few of the employees to the parent company and I think the second one was this. So just want to understand how the employee calls going forward will pan out considering the adjustments done.
Anurag Mittal
So Rajvi, we have done capitalization of near about 1.5 crore in this quarter 1 FY26 and the purpose of doing. This capitalization is to bring that uni. Shaped product to a terminal stage. We don’t anticipate to do capitalizations in the subsequent quarters. In fact no major capitalizations anticipated in quarter two onward and our endeavor is to make sure that we should able to roll out these technologies within quarter two itself. So our product and technology teams are. Working unanimously to make sure that we should roll out these technologies as quick as possible in quarter quiz.
Unidentified Participant
So the employee expenses will normalize right in the next quarters to come.
Anurag Mittal
In fact, employee expenses are already normalized subject to this 1.5 crore of capitalization we have done. And in fact to be honest, in fact this employee expenses are quite sustainable. Our employee benefit expenses has changed due to two factors. Largely largely the first, we have continued to improve our process efficiency including substantial use of artificial intelligence in daily operations and technology development. This has actually allowed us to operate with a leaner and more agility.
Unidentified Participant
Okay answer on the amortization cost. So we are expecting it to remain as it is or it will come down.
Anurag Mittal
So amortization expense. In fact, while we spoke about this capitalization part in the shipway, we believe that the group is in a process of integrating these internally developed solutions with the technology acquired through the business acquisition of Shipwrecked Technology Private Limited and the integration is expected to enhance shipwrecked existing product capabilities, facilitate deeper market penetration, extend the useful life of Shipwave brand and strengthen customer relations. So upon successful completion of the integration. Which is well scheduled and planned in quarter two itself, the company will evaluate the useful life of combined developed and acquired technologies and accordingly the amortization spend will further reduce subsequent in the quarter two and onwards.
Unidentified Participant
Okay answer the There were revisions made in the valuations of shipment shipway as in the rest 57% which was acquired. So any reason or any color that you can give on that front.
Kapil Makhija
Could you please repeat your question? It wasn’t very clear to us.
Unidentified Participant
Oh yes, I was talking about the revisions and valuation of shift they made so the remaining 57% that was acquired that was acquired at a higher valuation. So just wanted some color on why this revision had to happen.
Anurag Mittal
While we did the transaction transfer the valuation was around 160 crore and the trans to completion the transfer was our cash transaction. But transaction trans 2 we did the valuation of 179 crore so there is an upside of the valuation. Reason being there was the increase in the business size by that time why we completed this trans too hence there was an upside on in the valuation of a company.
operator
Thank you. The next question is from the line of Sahil Doshi. Please go ahead.
Unidentified Participant
Hi good morning team and thank you for the opportunity. I think my first question pertains to the standalone business. You know we’ve done a fabulous job in terms of client additions. The transaction growth have been relatively strong compared to the industry. But the real point is actually the revenues have actually remained in the same range for the last four quarters, one or two crores here and there. But we aren’t really seeing this translating into real profitable revenue growth in that sense. If I had to put it so could you just really quantify because you’ll also constantly be on a treadmill to add new clients.
There’ll be always new set of clients coming in. They’ll always be churned there. So what could you possibly tell us? When do we really start seeing the revenue growth coming in the business?
Kapil Makhija
Thanks sahib. So as you mentioned that the growth of univer standalone business is a result of the overall market growth and like I mentioned that’s something we cannot control. So we continue to add new clients. We feel that there is a. There continues to be a large market out there where as in the earlier discussions in the earnings call we had mentioned that even today we feel that about 80 to 85% of the market of dropship market because it’s fairly nascent, still uses Excel or manual operations to manage their E commerce business. As a result, as the complexity of the E commerce ecosystem increases and the overall scale of the ecosystem increases, we believe that a lot more businesses will look for software where given that we are the largest there in the market, we continue to have a top of the mind recall for opting for solutions.
So I don’t think that we will see any slowdown in terms of new client acquisitions that will continue to grow strong. And as we had demonstrated in our FY24 and FY25 result, the new client acquisition continue to contribute consistently in the growth. Our growth in the last couple of years has been a bit subdued largely because of the overall market growth and it’s hard for us to predict when this market growth is going to come back. Although we do see the initial signs of quarter two in terms of the sales season of Rakshabandhan and Prime day sales.
We have seen a higher growth compared to the summer sale that we saw in Q1, but it’s hard for us to say whether that’s representative for the full quarter. But at least the sales season, at least in quarter two has been a bit encouraging. But I think once the quarter completes he’ll be able to comment further on whether the market growth is coming back which should translate into high growth for eos standards and business as well.
Unidentified Participant
So couple I’ll just rephrase this. I understand on the market outlook, see, we’ve been having consistently 20% plus transaction growth. So when you say market growth, what is the level you would want for that to give you the ability to take pricing growth as well for us to see at least double digit kind of revenue growth. And secondly, if you can possibly, just to help us understand this and get more comfort, could you quantify how much of this transaction growth is today, not or below the minimum guarantee so that we know that there’s no revenue contribution and possibly in the future what the team is trying to build will actually translate into revenue growth?
Kapil Makhija
Yes. So first of all, addressing the point about 19% transaction growth, as I mentioned, a lot of this transaction growth is a result of new client acquisitions and bulk of this transaction growth gets assumed in a minimum guarantee that the new clients are paying us. The strong client acquisition that we’ve got in Q1 and hopefully will continue in subsequent quarters should help us in driving the growth in subsequent quarters. In addition, given that the market has been relatively subdued in the last two years, we have also built new products as well as significantly upgraded the capabilities that our existing products had to ensure that they become future levers of growth in the standalone business.
So we, as I mentioned before as well that we continue to focus on initiatives which are in our control in driving sales acquisition, in building new products and enhancing our product capabilities so that we continue to serve the ecosystem and are able to deliver growth. And if the market is able to show higher growth, as we’ve seen some initial signs of that in quarter 2 sales, we should be able to see higher growth in subsequent quarters.
Unidentified Participant
When you say growth, you mean absolute revenue growth, right?
Kapil Makhija
I’m just trying to understand that absolute revenue growth. And also like while the standalone business, we had anticipated that the growth is probably not going to be high given the market conditions, we’ve ensured that we continue to optimize the cost and focus on delivering high levels of profitability and high levels of operating leverage. Even higher levels of operating leverage this year compared to previous few years. We have leveraged AI to optimize our internal processes, are able to build a lot more than we did in the last couple of years to ensure that we are able to do it with a leaner team and continue to deliver high levels of profitability.
So the way we are structuring the business is that the new products will continue to channel growth for us while the existing mature business which is Uniware will continue to drive or contribute large pools of profitability. Having said that, we continue to focus and drive initiatives which can drive growth in the standalone business as well.
Unidentified Participant
Sure. Just I don’t think these questions were answered. Could you possibly quantify how much of this 25 crore transaction process this quarter was non remunerative or something of that sort? Just to get clarity.
Kapil Makhija
I think that will be business sensitive. That will be business sensitive for us. We do publish our NRR at a annual level so that that becomes an indicator of the growth from the existing customers which broadly has been in line with the market growth as we’ve published it in FY24 and FY25. So I think as, as the numbers mature through the year, I think by the end of the year we should be able to publish another round number.
Unidentified Participant
Okay, sure. And just lastly on Shipway, I just wanted to get a sense on the competitive dynamics. Are we seeing pricing environment getting better or adverse because of consolidation in the market which we are seeing at least on the courier and the E commerce delivery guys? At least.
Kapil Makhija
I think as I mentioned we are a little small player in the large market so we are not seeing that dynamic play out for us yet. And I think there are enough and more logistics partners for which the need for aggregation will continue to be strong because of the diversity of the Indian landscape and the complexity of the E commerce ecosystem, particularly when a brand is trying to sell on their website or on social media. So we haven’t seen any sort of decline in the demand for it and the market continues to be large enough which shows that there is significant headroom for growth for Shipwrecker in from the pricing environment.
Yeah. So I think given one of the key synergies that Shipwreck got after acquisition by unicommerce was because of our strong commercial arrangements with the courier partners at a group level because of which Shipway has been able to leverage the benefits of that and pass on the benefits. And one of the key levers of ship pay becoming fat, positive and breakeven was a result of the direct cost benefits that Shipbu was able to derive due to grip level synergies. So so far we’ve not seen any impact on our pricing because we’ve already got enough benefit thanks to the grip level synergy.
Unidentified Participant
Thank you. That’s it from my end and best wishes to the team. Thank you.
Kapil Makhija
Thanks Ayesh.
operator
Thank you. The next question is from the line of Shreyansh Gathani from SG Securities. Please go ahead.
Shreyansh Gattani
Hi Good morning. I just wanted to follow up on one of the questions from the past participants. So if I look at the top. 10 customers, revenue, right? So like last, last year comes to around 58 crores versus now it’s 42 crores. So when you say that you know they’re growing in line with the market and you know there’s no loss or anything as such. Like I’m trying to understand if the minimum guarantee was offered to them or you know, what am I missing here? Like it’s down by 28% or so. So like how do we look at it? If you can help me understand this. Revenue contribution from the top 10 customers.
Kapil Makhija
Yes, I think it will be difficult for us to comment on the specific business profile of the top 10 customers. But what I can tell you is that 100% of the dropship business continues to be managed on us and there has been no logo churn amongst the top 10 customers. So the performance of the top 10 customers in absolute is the reflection of of their own business growth. And all of the entire business still continues to be managed on unicommune.
Shreyansh Gattani
Okay, second question is on the international business, so you mentioned the Middle east, there’s a large contract. So is the, is the contract like different in nature from like a domestic business or like it’s like it’s a fixed revenue contract or how does that work? Like the model is the same or different there.
Kapil Makhija
So I want to clarify. The large contract is from Southeast Asia. While we do continue to work in Middle east with a large retail conglomerate where we are onboarding various of the retail businesses onto our platform. This large contract in Southeast Asia is similar to how we do it in the domestic market as well where it is linked to the, the expansion of the business as we do it in the domestic market. And the product deployment is also similar. So it’s a common stack that we are like, we have always maintained that we build our technology like a platform.
As a common platform gets deployed across various clients and it gets configured depending on the use cases of a particular client. In the same way for the Slack contract we are configuring the platform to be able to suit their use case.
Shreyansh Gattani
Got it, got it. So at this point what, what contribution would be coming from the international business?
Kapil Makhija
Yeah, so the international business is roughly 4 to 5% of the overall revenues.
Shreyansh Gattani
Okay, okay. And what kind of growth do we expect, you know, from the international business in terms of like just trying to understand like pricing differential versus domestic and you know, revenue growth coming in from there if that’s going to be in line with the client growth or like is it priced higher?
Kapil Makhija
See, we continue to see a steady traction in our focus geographies in Middle east and Southeast Asia and our in a calibrated and cost capital efficient manner. In terms of our again pricing in international markets versus domestic markets, that’s business sensitive but I think international business is still in these markets. India carefully chosen these markets in Middle east and Southeast Asia because we feel that these markets are in terms of E commerce evolution are a few years behind Indian E Commerce and hence the product and the platform that we develop is readily usable in these markets.
So I think the dropship model in terms of the scale and complexity is yet to see the peak that Indian E commerce has seen and hence the volumes being managed of these businesses in these markets are relatively lower compared to India, both the scale and the complexity. But we again end up the pricing continues to be slightly higher in these markets compared to India but it’s early days, it’s still only 4 to 5% of our overall revenues. And as the E commerce ecosystem in these markets evolves, I think the pricing as well as the use cases in these markets will stabilize and mature over in due course of time.
Shreyansh Gattani
Got it, got it. So last question was on, you know, in the last, I think last quarter, the quarter before that you mentioned that you know you’re starting to have like certain price escalation clauses in the contract. So like when do those start, you know, kicking in like and when did we start doing that? If you could give some color on that.
Kapil Makhija
Yeah. So as you would recall that we had mentioned that the price escalation has been introduced on the new contracts since last year. The benefit of that will start accruing in the later part of this year as more and more contracts complete the year through FY26. We are also carefully observing the impact of these the prices place in the new contract and we hope to extend this to our existing contracts as well. And the benefit, if we are able to do this for existing contracts in this year, the benefit of that should accrue in the following year.
Shreyansh Gattani
Got it? Got it. That’s helpful. Thank you. That’s all from my end.
operator
Thank you. I now hand the conference over to Mr. Kapil Makhija for closing remarks.
Kapil Makhija
Thank you everyone for joining the call today. We hope you have been able to address your queries. Should you have any further queries or clarifications, please feel free to reach out to us, our strategy growth advisors, our investor relations advisor thank you and have a good day.
operator
Thank you. On behalf of unicommerce Esolutions limited, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.