Unicommerce eSolutions Ltd (NSE: UNIECOM) Q3 2025 Earnings Call dated Feb. 03, 2025
Corporate Participants:
Kapil Makhija — Managing Director & Chief Executive Officer
Anurag Mittal — Chief Financial Officer
Analysts:
Vidyadhar — Analyst
Sahil Doshi — Analyst
Nilesh Shah — Analyst
Sumeet Jain — Analyst
Payal Shah — Analyst
Aditi Nawal — Analyst
Jalaj Manocha — Analyst
Ananya Nichani — Analyst
Presentation:
Operator
Ladies and gentlemen, good morning, and welcome to the Unicommerce eSolutions Limited Q3 and 9M FY25 Earnings Conference call.
This conference call may contain forward-looking statements about the company which are based on the beliefs, opinions, and expectations of the company as on 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 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 than zero on your touchtone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Kapil Makhija, Managing Director and CEO of Unicommerce eSolutions Limited. Please go ahead, sir.
Kapil Makhija — Managing Director & Chief Executive Officer
Thanks, Ryan. Hello and good morning everyone we are excited to meet all of you again and I welcome everyone to the quarter three and nine months FY25 earnings call of Unicommerce eSolutions Limited. I am delighted to be joined by Anurag Mittal, our CFO and Strategic Growth Advisors, our Investor Relations Advisors.
We are pleased to report a strong performance in quarter three and nine months FY25. Our consolidated revenue for quarter three FY25 and nine months FY25 grew by 26.1% year on year and 16.2% year on year respectively. Our adjusted EBITDA grew by 63.5% year on year in quarter three FY25 and 42.7% year on year in nine months FY25 Our PAT grew by 62.3% year on year in quarter three Fy25 and 39.3% year on year in nine months Fy25 Due to stronger operating leverage in our business, as many of you know, we recently acquired a nearly 43% stake in Chipay Technology Private Limited, a software as a service or a SaaS company dedicated to e commerce enablement. Much like Unicommerce, we are happy to share that this acquisition was successfully completed on December 17, 2024.
We remain committed to acquiring the remaining stake in the company with this acquisition, our product portfolio now spans the entire E-Commerce value chain, reinforcing our vision of becoming a a one-stop shop for e-commerce enablement. Going forward, unicommerce will serve as the umbrella for three product platforms. The first platform is Convertway as a part of Customer Engagement layer where orders are placed. The second platform is Uniware as a part of the Transaction Processing layer where all operational decisions are taken in respect to orders, inventory, warehouse stores and more.
And the third platform is Shipway in the Order Fulfillment layer which includes everything related to logistics from the point of handover of shipment to a third-party logistics service provider or 3 PL, including returns and exchange. Let me briefly introduce each platform for the benefit of of the new attendees on this quarter 3 and 9 months FY25 earnings call Let me begin with Convertway. It is an AI-enabled marketing automation platform designed to boost conversions and sales. It achieves this in three ways. First, by increasing the client’s subscriber base through gamification, second by engaging users with personalized campaigns based on their behavior on the website and third, by enhancing customer support during the purchase journey or post purchase with chatbots. These features help our clients maximize revenue, drive new trials and improve customer retention, making Convertway a powerful growth tool for e commerce businesses. Although the platform is still in its early stage, we are optimistic about its potential
Now turning to Unibair, it has been our flagship platform at unicommerce for over a decade and simplifies the complex back end operation of e commerce businesses. It handles everything after a customer completes the purchase, including inventory management, order processing across multiple channels, warehouse operations and seamless handling of return inventory. It also supports advanced omnichannel use cases like shipping from the nearest store and endless aisle that is Placing an order for products not in stock within the store.
With over 270 integrations spanning sales channels, logistics providers, ERP systems, and point-of-sale software, Uniware delivers unmatched operational flexibility across industries such as fashion, pharma, beauty and footwear across varying scale of operations. Our third platform, Shipway, is a full stack logistics management platform. It offers two distinct products. The first product is Courier Aggregation for clients managing logistics across multiple courier providers via a single platform and the second product is Shipping automation for clients using their own commercial terms with logistics players but requiring advanced technology to run daily operations.
Convertway drives sales growth, Univer streamlines operations and Shipway enhances logistics efficiency. Together, these platforms address the most critical challenges faced by e commerce businesses. Univer, our flagship platform, has been the market leader in its segment with a large operating scale and demonstrates strong operating leverage driving consistent growth in our profitability. Shipway and Convertway, on the other hand, are relatively newer entrants in their respective fields and we see significant potential for growth in their scale going forward with our combined strength and value to customers.
With a combined client base of over seven thousand businesses across Convertway, Uniware and Shipway. We foresee significant cross selling opportunities, particularly since the current overlap of customers between the products is very small at less than 5% now coming to the quarter three business updates this quarter we continued expanding our client base on Uniware and its usage has seen a steady rise, achieving an annualized run rate of over 1 billion order items processed. Reflecting the increasing adoption of our solutions, our ongoing investments in technology and product development remain central to our strategy. These efforts are focused on enhancing adaptability and scalability to address evolving clients needs, ensuring we can better serve both existing and new clients.
In the past quarter we prioritized several key developments in the existing product suite that addresses critical operational challenges including new integrations, omnichannel returns management, and new features for the gifting industry. We also added AI first automated order punching for B2B orders during the last quarter, making it easier for our clients to use our platform.
On the new product front, Convertway continued to strengthen its personalization capabilities, introducing custom flow creation for tailored customer engagement journeys. It also launched an AI powered template generator to streamline campaign creation with optimized communication template. Unireco, which focuses on payment reconciliation, continues to receive promising feedback. We remain on track for a commercial launch by the end of quarter one FY26 and this will further enhance our position as a comprehensive e commerce enablement platform. Shipway partnered with India Post to enhance especially in tier 2 and tier 3 destinations. It also launched same day and next day delivery services in collaboration with courier partners to meet the fast delivery demands of D2C brands and sellers.
As part of our strategic consolidation efforts, Uniship will be merged with Shipface Shipping Automation Solution. This integration will allow us to leverage Shipways expertise and deliver a unified enhanced offering to our customers. We are continuing to invest in this area to develop a more robust and competitive solution. Our continued investments combined with our end to end capabilities across Convertway, Uniware, and Chipway position us to strengthen our leadership in the e commerce enablement space and unlock new growth opportunities.
As a recap from our past calls, let me quickly summarize the key growth drivers for uni commerce moving forward. Firstly, India’s E commerce market remains under penetrated, offering significant long term growth potential. As digital adoption deepens and the market scale, we are well positioned to capitalize on the shift towards SaaS platforms for operational efficiency. Second, the total addressable market or Tam for Unicommerce’s core products is approximately $260 million with an additional $420 million for our complementary offering. With the inclusion of Shipway, the TAM for courier aggregation adds approximately $470 million, bringing our combined TAM to over $1.15 billion. This presents a substantial opportunity for us as the market evolves in scale and complexity.
The third growth driver for us is acquisition of new clients in Quarter 3 FY25. We continue to add marquee brands such as High Design and Hummel to our portfolio. In addition to new brands entering the market and scaling up, traditional and untapped industries are increasingly transitioning to online platforms and as they scale, the demand for SaaS solutions like ours grows. The fourth growth lever for us is our extended product portfolio. With our three platforms across the E commerce value chain, we are uniquely positioned to simplify operations and accelerate growth for E commerce brands and sellers.
We will continue to enhance our offerings further as per the needs of the E commerce ecosystem. In summary, the long term outlook for the Indian e commerce market is promising. Driven by increasing digital adoption and evolving consumer preferences, we remain confident in unicommerce’s growth trajectory. Having consistently achieved market growth over the years, we expect to continue performing at the same level moving forward along with demonstrating strong operating leverage, achieving expanding profitability.
With that, 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. We are pleased to report good performance for quarter three and nine months FY25. Let me take you through the highlights of our consolidated financials. Our revenue for Quarter 3 FY25 grew by 26.1% year on year reaching to 327.4 million compared to 259.6 million in quarter 3 FY24 our adjusted EBITDA increased to 88.8 million in quarter 3 FY25 or 63.5% year on year growth compared to 54.3 million in quarter 3 FY24.
Adjusted EBITDA margin improved by 620 basis points year on year rising to 27.1% in quarter 3 FY25 from 20.9% in quarter 3 FY24 due to the benefit of operating leverage, our PAT grew by 62.3% year on year reaching to 62.9 million in quarter three FY25 compared to 38.8 million in quarter three FY24 PAT margin improved by 428 basis points year on year, rising to 19.2% in quarter three FY25 from 14.9% in quarter three FY24 on the nine month basis, our revenue increased by 16.2% year on year to 895.2 million in nine months FY25 compared to 770.5 million in nine months FY24.
Our adjusted EBITDA grew by 42.7% year on year reaching to 195.1 million in nine months FY25 compared To 136.8 million in nine months FY24 Adjusted EBITDA margin improved by 405 basis points year on year, standing at 21.8% in nine months FY25 compared to 17.7% in nine months FY24 Our PAT increased by 39.3% year on year reaching To 142.8 million in nine months FY25 compared to 102.5 million in nine months FY 24. PAT margin improved by 265 basis points year on year standing at 15.9% in 9 months FY25 compared to 13.3% in 9 months FY24.
In summary, our sustained investment in the existing products, acquisition of ship pay and convert pay, new product development and the operational efficiencies of our scalable model position us well for the future growth and profitability. We are confident in our ability to leverage these investments and create long term value for the company.
With this I would now like to open the floor for Q and A. 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 their 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 Vidyadhar from Sohum Asset Managers. Please go ahead.
Vidyadhar
Thank you. Good morning. My first question is that both on a standalone as well as a console basis you are a beta margin has shown a very welcome significant improvement. But that seems one of the main drivers seems to be the fall in employee costs and you were one of the notes to the results also suggests that the employee cost fall was perhaps because of some prior period last year’s performance bonus deductions. If you could just give us some clarity on what’s really happened.
What was the recurring excluding the prior period items if in what was the employee cost in Q3 and what is the sustainable EBITDA margin standalone and shipway for 15 days appears to be based on 15 days of yesterday, something like a 30 lakh loss. So what’s the outlook for Shipway going forward? When will it turn profitable and how does the consolidated entity look?
And lastly if I could add what is a possible dilution of equity when you acquire 100% in ship, which is again mentioned in one of your notes? Thanks.
Kapil Makhija
I think there are a series of questions. Let me try and address them one by one. I think your first question was in terms of the operating leverage in the business, how sustainable it is, given that in terms of the manpower expenses, because that’s where the most reduction has happened, I think I wanted to clarify, and we’ve said that in the previous earning call as well, that our flagship platform Univer is actually quite stable requiring only minimal investments because we invested a lot on this platform during the years FY21 and FY22. So hence our employee expenses are not increasing in line with our revenue growth.
With our new products also nearing maturity, we are also realigning our manpower expenses to align with appropriate investments resulting in expanding profitability. So whatever data points that you’ve highlighted are in line with our plan to realign our manpower expenses because our core platform Univer, which is our flagship platform, does not require as much investment.
On the second question about Chipway turning profitable compared to FY24 when Shipper demonstrated a PAT of negative 5%, we are at less than 3% negative PAT as of the December month, like the last 15 days that we consolidated. So chip pay as a business continues to demonstrate growth, both chip pay and convert pay and continue to show improving profitability. We continue to see consistent improvement in the loss margins and we would continue to optimize the business by utilizing the synergies on both direct and indirect costs. And our endeavor is to make the business pack positive very soon.
There was a third question also…
Vidyadhar
Dilution of equity on merger of shipway or whatever. You said that stocks share swap or merger of shipway.
Kapil Makhija
So we have completed the first tranche of transaction by paying out cash on December 17, 2024. Now the second transaction will be taken up soon. The value of the completed transaction will be decided as for the fair market value at the time of the follow up tranche and the follow up tranche will be completed through the merger or swap which will be decided soon.
Vidyadhar
Okay, so no, not easily possible to give color on extent of dilution, is it? And also on the my earlier questions there appears to be a 2 crore write back of employee costs related to last year. Is that correct? What was the recurring employee cost in this quarter? I would appreciate if you could give a specific answer to that or at least some ballpark number.
Anurag Mittal
So the one time reversal is as Kapil also mentioned, in fact, we are optimizing our manpower expenses. So the one-time reversal is also in line with our plan to realign the manpower expenses.
Vidyadhar
Okay, so therefore let’s say that either 25% standalone business EBITDA margin sustainable and I take not adjusted but a reported EBITDA margin. That’s the kind of you are, I think 25 point actually standalone, something like a 2720, almost 28% over 28% EBITDA margin in Q3. So what’s a sustainable standalone margin?
Anurag Mittal
Yes, this improvement is a result of the operating leverage in our univair business. And most of our expenses below the gross margin are largely fixed in nature due to this, as our revenue grow, these costs won’t increase at the same price.
Vidyadhar
Okay, so it is sort of sustainable, is it where the employee cost of around 40 odd percent, which is where you are in this quarter? So that’s probably a sustainable at least on a standalone basis.
Anurag Mittal
Yes, that’s correct.
Vidyadhar
Okay, that’s pretty good. Thanks.
Operator
Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and 1. The next question comes from the line of Sahil Doshi from Thinkwise Wealth Managers LLP. Please go ahead.
Sahil Doshi
Hi, good morning. I hope I’m audible.
Operator
Yes, I’ll. Please go ahead.
Sahil Doshi
Yeah, my question pertains to the standalone business. If I see the transactions, you know, revenue per transaction. This is the third quarter, we’ve seen a yoy dip in the revenue per transaction to 1.14. Just wanted to get a sense on what’s really leading to this and where do we see this stabilizing at. And similarly, on the transaction process, the rate of growth has also slowed down to around 15% on a bioi basis. So could you possibly give us a breakup of what just at least qualitatively call out how much of this growth is led by the existing client and how much is through new client addition?
Kapil Makhija
Sure. See, we mentioned in the earlier earnings call as well that our steady state price continues to be in the range of 1.2 to 1.3 rupees per item for Unibev, our flagship platform for quarter three FY25, the price of INR1.14 that he quoted is similar to last year which was 1.15. The quarter three being a festive season quarter, it generally has a lower price per transaction than other quarters because there is an increased order velocity due to festive season as a lot of transaction growth gets absorbed in the minimum guarantee as we described in the earlier earnings call as well. So the steady state continues to be in the range of 1.2 to 1.3 as I mentioned. Sorry, what was the second part of your question, Sahil?
Sahil Doshi
Yeah, sorry, I think my second part of the question was more on the growth rate. If you can possibly call out what’s the growth you’re seeing from the existing client?
Kapil Makhija
Sure. So what we described in the earlier call as well, that post of Diwali sales which this year a part of that Diwali sales also happened in September because this year the Diwali was earlier as opposed to last year where the entire sate sales happened in Q3 and hence you see a slightly muted growth. But overall we are seeing that post the Diwali sales, the first few days of the Diwali sale in general the sales have not yielded a strong growth which was the trend even last year as well. So we continue to see the overall E-commerce volumes to be muted and that’s why our endeavor is to have a one-stop shop for E-commerce businesses across three platforms this Convertway, Univer and Chipway so that increasingly more and more businesses can opt for services that are available under a single umbrella and we continue to drive adoption across the ecosystem.
Sahil Doshi
Sure, sure. Okay. But could you give some qualitative remarks? If you are seeing, you know, flattish growth from your existing clients, or what is the nature of growth? I mean that will be very helpful.
Kapil Makhija
Sure. So the growth from existing clients is measured to what we call as nrr. NRR is net revenue retention. In spite of the overall muted growth in the E-commerce market, we still continue to demonstrate 100% plus NRR. We will not be able to share specifics on the NRR because of business sensitivity reasons, but it continues to be more than 100%. So our existing customers net of churn continue to grow consistently and we continue to add more growth by adding new clients.
Sahil Doshi
Thank you. Thank you. And just one last question related to the capitalization which we do for the new tech development course. See it’s been around 10 odd crores for the nine months now that the shipway entity has been acquired and the line of operations possibly are similar. Could you possibly give us a sense of how much further investments would be required in these products and how should we think about amortization of these kind of costs which have been taken?
Kapil Makhija
One thing I want to clarify that the technology capitalization we have done in nine months FY25 is to the tune of 5.9 crore.
Sahil Doshi
Okay, okay, okay.
Kapil Makhija
Right. And in fact from the. Sorry, what was the second question?
Sahil Doshi
Yeah, meaning total capitalization additional we took 4.4 for the tech development related to shift base rate this quarter. So I would just talk. My question was the total capitalization which you’ve seen over the 10 months, over the nine months what is the with the shipwreck acquisition through how much further investment do we see in this new products and how should we think about amortization and going forward?
Kapil Makhija
So. So in this regard. So Sahil, in this regard the technology development related to the logistic automations now better aligns with the shipway business which we have done in last few quarters. Now the acquisition is completed and transferring the development to Shipway makes strategic sense. This transfer enhances the shipway’s product capabilities and make it stronger platform for the future.
In fact, in this particular product specifically the UNI ship by now the amount is 43.9 million and and is based on the actual cost incurred in developing the technology over the time. And this includes the direct cost related to the development, engineering efforts and other associated investments. And after this transfer shipware will continue to invest in the product for integration and to bring the development to the terminal state. It would be very early for us to confirm you the amount of the further development which we can update in the subsequent quarters.
Anurag Mittal
And also some of the new products like Unireco we continue to build. We are expecting to do a commercial launch by end of quarter one FY26. So we just want to again reinforce that any incremental developments continue to be expensed in our P and L only the new products that we build are getting capitalized so and to that extent whatever new products we are building currently that unit requires of now so only that portion can continue to get capitalized. All other expenses continue to get expense. Even the incremental developments in Chipweight and converter are also getting fully expense in the pnl.
Sahil Doshi
Sure. Could it possibly explain the amortization policy related to this capitalization? Like as and when the development happens, that’s the time when you will write it off or it will be amortized over a longer period.
Kapil Makhija
Yes. The amortization will be done in accordance to the India’s principles and will be done over a period of time that will approximately range to three to four, five years.
Sahil Doshi
Understood. That answers my question. Thank you so much and best wishes.
Operator
Thank you. The next question comes from the line of Nilesh Shah from Envision Capital. Please go ahead.
Nilesh Shah
Just wanted to understand this capitalization…
Operator
I’m sorry, if you could please speak up. Your audio is not audible.
Nilesh Shah
I just wanted to understand. Am I audible now?
Operator
Yes, please go ahead.
Nilesh Shah
Yeah, I just wanted to understand this capitalization of expenses, product development expenses. Is this, we’re doing this for the first time? Is this a change in our accounting policies and what implications it has for the future?
Anurag Mittal
So there is no change in the accounting policy per se. In fact, we have first capitalized Univair long back in 2014 and after that the company didn’t develop any new product. Now from FY25. In fact quarter one, FY25 we started focusing on new product development and we are capitalizing these new products. In fact in last 8, 9, 10 years, what all enhancements, etc. What we have done were charged off in the profit and loss account as Kapil also mentioned recently in the last question.
Nilesh Shah
So going forward also whenever we would do any product development, new product development, we would capitalize those expenses.
Anurag Mittal
Yes, new product development will be capitalized. Any enhancements we do in the existing product will be charged off to the profit and loss.
Nilesh Shah
Okay, fine.
Operator
Thank you. The next question comes from the line of Sumeet Jain from CLSA. Please go ahead.
Sumeet Jain
Yeah, hi. Thanks for the opportunity and congrats on decent set of, you know, pricing, particularly this quarter and the margins. So firstly, Kapil, I just want to understand in your presentation you have highlighted the potential shipment growth opportunity is around 31% CAGR over the next four years. But when you and and you plan to grow at market plus plus rate, that’s what you have grown for the past four years as well. So can we assume that your volume shipments should be north of 31%.
Kapil Makhija
So Sumit, the growth that we demonstrated in our deck is a long-term steady state. I think we firmly believe that the long term potential for E-commerce is intact. We are seeing some growth slowing down since last year so we can’t really predict when the growth will pick up. But we firmly believe that the long term story for E commerce is intact. And as an E commerce continues to demonstrate growth in the range of let’s say 20, 30%, we will continue to deliver a market plus plus growth rate. We have done that historically and we are confident that we will continue to do that.
In the current year we like last year we had mentioned that the overall market as per our estimates grew middle to late single digits. And this year we see that the overall market is growing in early to mid mid single digits. So our overall growth is also a reflection of that. But we will continue to maintain a market plus plus growth rate.
Sumeet Jain
Okay, but I look at, if I look at the retail sector in India, right that’s growing at high single digits to low double digits and probably E-commerce on an overall category basis must be growing higher than that. So is it that your relevant customers are growing at a lower rate? So because we don’t get an industry data out there on a quarterly basis but just to understand like when you talk about low mid single to mid single digit growth for the overall E-commerce market, like what are the sources for that number?
Kapil Makhija
Sure. So first let me comment on the offline growth. I think although we are E commerce enablement software but we have seen some increase in select offline retailers. But we can’t really generalize and say that that’s the sense for the market. And similarly for few E commerce merchants there may be some growth and that’s also there in our customer base as well. See we are processing nearly a billion order items annually now we’re at annual run rate. So in a way they become an index to E commerce operation.
So what we are representing, the market growth is kind of reflective of the overall market. Select businesses may have grown faster and which is the case with many of our customers, but a large portion of our customers still continue to demonstrate muted growth which is what we are seeing in the ecosystem.
Sumeet Jain
Got it. That’s helpful. And then if I look at your top 10 client revenues, I mean, on an absolute basis, on a y o wide basis, it is largely flat. So how should we assume, is it because of change in your top 10 client revenue rankings or is it that your top customers growth is not that strong. How should we look at it?
Kapil Makhija
So like I mentioned, the overall market growth in E Commerce has been slightly muted and our top 10 customers performance is also a reflection of that. We haven’t seen any material change in the top 10 composition but it is a reflection of the overall market growth itself. And that’s why as I mentioned that in spite of that we continue to maintain a 100% plus NRR and continue to add more and more customers to drive a market plus plus growth in our business.
Sumeet Jain
Got it. And what macro factors or maybe micro factors, one should look at couple to assess that when this demand on a cyclical basis should start improving?
Kapil Makhija
I think a few macro factors, one is related to the overall consumption. So as the consumption in the country increases across the board, across a broad spectrum, we should see an overall improvement in E commerce. Structurally we see E commerce is becoming a way of life. There are today no brand, no retail brand is planning their business strategy without E-commerce in mind. So I think that’s a welcome change compared to let’s five, seven years ago when the E-commerce and particularly the dropship market in E commerce was starting to grow. I think it is a combination of one overall consumption improvement.
Second is relative penetration of E commerce within the overall retail ecosystem. It has become a way of life for metros, metro cities. But in tier two, tier three cities we are yet to see a growth happening. And third is the overall infrastructure getting built out, the logistics ecosystem. I think these were the three macro trends that anyone could try to see how the overall e-commerce movement is going on.
Sumeet Jain
Got it. And are you working with the quick commerce players? And is the strong growth in quick commerce helping you or not helping you in any way?
Anurag Mittal
Yeah. So we are already integrated with the leading quick commerce channels. In fact see we are a sales channel agnostic platform. So for us, as more and more channels become commonplace in the E-commerce ecosystem, it actually helps the businesses. It further increases the complexity. Today many brands along with selling on E-commerce channels also have to sell on quick commerce channels to drive their growth. And that’s why increasingly they need a technology platform to manage this multiple channels.
In line with that, that’s why we had mentioned in our earlier earnings call that we are integrated with all leading good commerce channels. And in fact the recent development that we have done for the AI-powered B2B order punching tool that we built also enables the brand to manage their not only quick commerce orders but also general trade and modern trade orders as well. The idea is to become increasingly become a one stop shop for E commerce enablement for our brand. And that’s why we continue to invest in our products to make sure that they can manage all parts of their businesses from a single platform, which is us.
Sumeet Jain
Got it. That’s helpful. And coming to your cost side, can you just throw a light like why the server hosting expenses have gone up quite materially this quarter, both sequentially and on a y o y basis and same for other expenses as well.
Kapil Makhija
Sure. So server hosting expenses, I’ll talk about server hosting expenses, then I hand it over to Anurag to talk about other expenses. So what we have done is that we continue to invest in security in our platform and continue to drive continuous enhancements on our platform. So there is a short-term increase on our server hosting expenses. Not a large one, a minor one. But that is in line with the investments that we are doing to drive like higher technology enhancements. In line with. You see the technology around us is changing so fast.
We are also making investments to make sure that we are in line or in tune with the latest developments that are happening around us and continue to invest in security because that’s also paramount to our customers. So that’s the reason for our increase in the short term in our server hosting expenses. But we are confident that it will come down to a steady state number as it used to be as our revenue continues to grow. Because as we have mentioned before that our server hosting expenses also do not need to grow in line with the revenue growth. So that will come down on the other expenses. I’ll hand it over to Anurag.
Anurag Mittal
So Sumeet, our other expenses largely includes legal and professional sales and marketing and travel and other G and D related expenses. The primary reason for the increase in cost over the last year is due to for the unipair we have a higher sales and marketing expenses as we continue to invest in our business growth and certain costs are related to post-listing compliances as well towards legal and professional. In addition to this we have also consolidated other expenses relating to Shipway and Convertway in Quarter 3 FY25 and one of the addition relates to the freight expenses of shipway.
Sumeet Jain
Got it. So how should we model it? Like Kapil, you mentioned that server hosting will come down to its normalized level in coming quarters. Should we assume that from Q4 itself and same thing for other expenses as well? How long will this be elevated and should we assume the other expenses to remain at these level as a percentage of revenues?
Anurag Mittal
So Sumeet, I think it’ll be difficult for us to talk about specific quarters. It is a server hosting expenses on a steady state basis. We should come back to the normalized level as I mentioned. On the other expenses…
Kapil Makhija
Large part of the cost are fixed Sumit. In fact below the gross margin, you know, and other expenses seems to be in the same ballpark but difficult to comment upon for the subsequent quarters at this point in time.
Sumeet Jain
Right. And lastly, can you also comment what was the inorganic growth in this quarter for you given the Shipway acquisition impact of 13, 14 days.
Kapil Makhija
So Sumeet, we don’t consider this as an inorganic growth. Right. So these are. Our endeavor is to become a one stop shop for E commerce enablement. So all the platforms now are part of our overall offering. So we now offer three platforms which is Convertway, Uniware, and Chipway. We can talk about the specific revenue of Shipway but essentially I just want the participants to understand that we view this as part of the overall unicommerce entity where we are offering three platforms because see the solutions are being sold to similar businesses. These are all E-commerce businesses and Shipwreck and Convertway platforms also offer E-commerce enablement.
So we are increasingly viewing this as a single business offering three products, product lines which are serving to the same ecosystem as Univair was serving.
Sumeet Jain
Got it. That’s very helpful. That’s all I had and all the best. Thank you.
Operator
Thank you. The next question comes from the line of Payal Shah from Billion Securities. Please go ahead.
Payal Shah
Yeah. Good…
Operator
Apologies to interrupt you Payal, but your audio is not clear.
Payal Shah
Is it clear now?
Operator
Yes, please go ahead.
Payal Shah
Yeah. Good morning. Thank you so much for the opportunity. So most of my questions have been answered. Just had one question. Can you throw some light on the competitive landscape of Shipway also now with Shipway to fully contribute starting this quarter and unirecode to further start contributing in the next financial year, how are you anticipating growth for FY26 and 27 and beyond? So just wanted. Can you throw some light on the same and it would be really helpful.
Kapil Makhija
Sure. If the question was about Shipwrecker as a platform. So Shipway as a platform as we mentioned has two products, Courier Aggregation and Shipping Automation. Courier Aggregation in particular, the space is fairly large. As we mentioned, the Tamper Courier aggregation is about $470 million. It’s nearly 4,000 crore. It’s a relatively new entrant in this space and there are various large players already present in the space already. So we see a significant headroom for growth for the Courier Aggregation piece within the Shipway platform.
And given that both Convertway and Shipway are relatively newer entrants in their respective spaces, we see a significant headroom for growth and should continue to drive growth. It will be difficult for us to talk about specific growth numbers for FY26 and 27. But as I mentioned before that we continue to grow Market plus plus. So we will continue to demonstrate strong growth and more importantly expanding profitability because our flagship platform Univair has significant operating leverage. So it’s fairly largest player in its segment and it’s fairly stable. It does not require significant investments now because we’ve invested quite a bit in FY21 and FY22. So that’s why the combination of the three platforms will help us drive continuous growth with expanding profitability.
Payal Shah
Okay, that’s quite helpful. Thank you so much.
Operator
Thank you. The next question comes from the line of Aditi Nawal from RSPN Ventures. Please go ahead.
Aditi Nawal
Yeah. Hi. Good morning. Thanks for taking my question. So I have a few questions. So the first one is you mentioned in your other OPEX there is some component of legal charges that may be relating to the acquisition of Shakpi. So could you just quantify that so that you know that will be like a one-off and maybe the EBITDA margin going forward could see slight improvement.
Kapil Makhija
Sorry, can you repeat the question? It’s not clear actually.
Aditi Nawal
Yes. So my question is in the OPEX line item you mentioned that there are certain legal charges that was that had incurred this quarter and I’m assuming that is related to the acquisition of shipwreck. So could you just quantify how much that is?
Anurag Mittal
Got it. So in fact that one-time legal expenses for the acquisition are not actually material and have not also been disclosed in the financial so would be difficult for us to share the number.
Kapil Makhija
And we also want to clarify the legal and professional increases largely because of the post-IPO compliances and not necessarily because of the acquisition. Not sure from where you made that deduction, but as we mentioned before, the legal and professional increase is largely because of post IPO compliances.
Aditi Nawal
Okay. Because. No, no. So I made the deduction because in the standalone your other expenses have not significantly improved. So it was only in the concern that the OPEX is increased.
Kapil Makhija
Yeah. So the other expenses increase in the, in the overall financials, this as Anurag mentioned is due to the freight charges for the courier aggregation business that we are, that we are providing now.
Aditi Nawal
Got it. Second question would be. So could you give us the numbers for revenue and shithe package nine months and this quarter? Okay, if that’s something that you are keeping a track of.
Anurag Mittal
So we are consolidating Shipway effective 17 December and we consolidated Shipway only for 15 days during quarter three, FY25 and nine months. FY25 from the revenue standpoint we consolidated shipping shippe contributed near about 32.7 million INR. And from a PAT standpoint shipping delivered a loss of 0.9 million for this period.
Aditi Nawal
So 15 days. Sorry, the 0.9 million is for the 15 days, right?
Anurag Mittal
Yes.
Aditi Nawal
So I mean if I’m not wrong, I think in some of your presentation you had mentioned that in the last year ship is pat was around negative 2.24 crores or so. So now for 15 days, we are coming to around 0.9 million. So isn’t that an increasing trajectory of losses?
Kapil Makhija
It’s in the similar ballpark. And see if you continue. This is a like I mentioned that both shipwrecked and convert were relatively newer entrants in the space. So there are some investments that continued in FY25 as well for us to drive growth. But if you look at from a percentage basis the pat margin was 5.2% loss at the end of FY24 and now it’s 2.8% and towards the end of this like in December FY25. So we are seeing an improving trajectory but these are currently in the initial phases and there is, there is going to be some investment so that will continue.
But as I said that we see as now we have three product lines we being offered to the overall E commerce ecosystem. We see material synergies on both direct and indirect cost that we can leverage as a combined entity. Because now we are offering three products to common set of customers which are selling like E-commerce businesses, both brands and sellers. So there are synergies on the selling side plus there are synergies on the direct and indirect cost side. And that’s where we are confident that we should be able to turn the business or turn these product lines back profitable very soon. We won’t be able to share a specific timeline but given the synergies we are confident that that should happen very soon.
Aditi Nawal
Got it. And what will be your SMB?
Operator
Sorry to interrupt you there. If you could please join back the queue.
Aditi Nawal
Sure. Thanks.
Operator
Thank you. The next question comes from the line of Jagbir Singh from Shade Capital. Please go ahead. If you can please proceed with your question.
Since there is no response we will move on to our next question from the line of Jalaj from Svan Investments. Please go ahead.
Jalaj Manocha
Hello. Am I audible?
Operator
Yes sir. Please go ahead.
Jalaj Manocha
Yeah, thanks for the opportunity. I just wanted to understand one thing. With regards to the employee cost, are there some one-time expenses which are sitting with some sort of reversals there? And secondly in case if it is not so then can you give a headcount maybe six months back or a year back so we can have a one-to-one comparison?
Anurag Mittal
Sure. So see like we mentioned earlier in the call that our flagship platform Uniweb does not require any material investments because now there are only few incremental enhancements that are required in line with as E commerce continues to evolve past. For example as Quick Commerce became mainstream, we integrated Quick Commerce as a digital-first brand expand offline. We built an AI-enabled B2B tool for them to any manage their modern trade and generated orders as well. So only these incremental enhancements are required. And that’s where we are realigning our manpower expenses to align with the fact that now the flagship platform does not require any material investment.
In terms of the I’ll come to the headcount point. So that’s why from a while you see a one time reversal of the bonus that we’ve disclosed. This is in line with our plan to realign our manpower expenses because our flagship platform does not require any material investment. If you look at our headcount, it’s largely in the similar ballpark. But we — but like the headcount today is about 350 employees in the quarter three ending FY25 if that helps answer your question.
Jalaj Manocha
Yeah, so thanks for that. So the head count number was same the last quarter. Also would it be safe to assume that?
Anurag Mittal
It’s in similar ballpark?
Jalaj Manocha
Got it. And then one last quick point on this. What sort of reversal? Or could you quantify the number the bonus reversals that you are alluded to?
Anurag Mittal
22 million is the number.
Jalaj Manocha
22 million. Got it, got it. Thanks and best of luck.
Anurag Mittal
Thank you.
Operator
Thank you. The next question comes from the line of Vidyadhar from Sohum Asset Managers. Please go ahead.
Vidyadhar
Thank you. So I presume the delta between console and standalone is shipwreck, is that correct? Most of it revenue and most of the other items.
Kapil Makhija
Yeah, that’s correct.
Vidyadhar
So there I think it works out to 3.3 crore as a delta in the revenue. So does this mean given that it’s for 15 days, the annualized revenue and the run rate prevailing in the last 15 days of December was about 80 crores.
Anurag Mittal
Sorry, I couldn’t. Could you please repeat the question again?
Vidyadhar
So the delta between your standalone console number is 3.3 crores and that’s 3.27 crores to be put in 2 decimals. So if that’s for 15 days and then I, if I were to annualize it, I get roughly 80 crores, slightly below 80 crores rounded off. 80 crores, is that, does that make sense? Is that kind of a number or was December seasonally a high or something?
Anurag Mittal
Yeah, that ranges. Ranges between 70 to 80 crore of annual rent. Yeah.
Vidyadhar
Okay. And. But by the same measure, if I do, the last number comes to around 35 lakhs, the delta between standalone and console and which then annualize works out to 8.4 crores. And you mentioned 9 lakhs.
Anurag Mittal
I think that is, that is not a right way of looking the things. We have recently acquired this company and for 15 days period our loss is 0.9 million. And our endeavor is to make it breakeven…
Vidyadhar
9 lakhs. Not 9 million, I presume.
Anurag Mittal
0.9. 0.9.
Vidyadhar
Yeah.
Anurag Mittal
Yeah. So our endeavor is to make this profitable and make it break even on a immediate basis as soon as possible in the subsequent quarters.
Vidyadhar
And so this delta between the standard and console profit is around minus 35 lakhs. Other than a 9 lakh there are some one-time items, is it?
Anurag Mittal
No. So basically that’s a one time on account of our depreciation we charged for the intangible capitalization we have done during quarter three FY25. So that near about 25 lakh is for that.
Vidyadhar
And that will be a recurring item.
Anurag Mittal
So in my previous question, if you remember, I addressed that the acquisition we have done, the value of investment we will capitalize in our books in a form of different assets based on the expert valuations and those assets will be amortized over a period of time.
Vidyadhar
Like what four or five years or much longer, a longer period. What kind of.
Anurag Mittal
So that will be in accordance to the India’s guidelines will actually range between three to five years or so.
Vidyadhar
Okay, so that’s so one you. The shipment numbers come in going forward and so until they become profitable, they slightly hurt your numbers, profitability, boost your revenue and the amortization is the other hit you get. So basically the quicker you turn around shipware then the profitability number also start looking at it. Is that the right way of looking at things?
Anurag Mittal
That’s fair. See, but the loss in Chipway is not material even today. So in spite of you see when for a quarter three results we continue to demonstrate a strong growth in our profits. So even if, let’s say shipwreck were to become breakeven, it doesn’t materially change because a large part of our profits are coming from a flagship platform which continues to demonstrate a strong operating leverage. And that will continue to happen.
So while our endeavor is to make the make the two platforms convert way and shift way breakeven and eventually pad positive, but a large part of our profitability will be driven from our flagship platform which continues to demonstrate a strong operating leverage.
Vidyadhar
It was there for only…
Operator
Please stand by the queue for further questions. Thank you. The next question comes from the line of Ananya from Thinqwise Wealth Managers LLP. Please go ahead.
Ananya Nichani
Hi, am I audible?
Kapil Makhija
Yeah.
Ananya Nichani
Yeah. I just wanted to ask about Shippe’s cost, specifically the gross margin. Is there any scope for improvement in the future? Because currently, it’s around 20% so once it’s fully consolidated it would significantly hit the consolidated entity gross margins. So just want some light on that.
Anurag Mittal
See as you mentioned there are synergies that we see on both the direct and indirect cost. So we will our endeavor is to continue to improve this. But like I mentioned that given that our flagship platform univer is largely stable, not requiring aggressive investment, so large part of our profits will come from the ingred platform. While ship pay and convert pay being relatively newer, entrants in their respective fields will continue to drive growth for our business and will continue to expand because they both are operating in large opportunities and we are confident that as we continue to grow them, they will continue to drive growth for us.
Having said that, as we see synergies in the direct cost and indirect cost plus with growth, we will continue to see economies of scale and continue to improve that as well. And also at the same time, I just want to highlight that while the gross margin in percentage terms in a business like courier, aggregation, or ship and converter combined seems lower compared to uniform, but if you look at the absolute margin per transaction is significantly higher than what we earn on our flagship platform Univar.
Ananya Nichani
Would you be able to share how much this is the transaction?
Anurag Mittal
So see, as an example today, that average revenue is about 70 to 80 rupees per shipment. So even if at an absolute margin of 20.4% that you mentioned, it comes to about 15 rupees per shipment, this is significantly higher than what we make in a flagship product uniform on a per transaction basis.
Ananya Nichani
Okay, got it. Thank you. And also I want to ask on Q Commerce, how relevant are we and how much is it contributing to our revenue?
Kapil Makhija
Very relevant. For any brand or seller who’s selling on multiple platforms including quick commerce. They need a single platform to be managed to be able to manage all the channels on a single platform. So we are very relevant. We don’t publish channel-wise breakup for our revenue business sensitivity. So that number we won’t be able to share. But wherever the E commerce market goes, earlier the movement happened from outright models to dropship models and today there is advent of quick commerce. E-commerce continues to evolve fast and increases the complexity for brands. And that’s where our role comes in. As the complexity in the ecosystem increases, there will be an increased need of a technology platform like ours.
Ananya Nichani
Okay, got it. Thank you so much.
Operator
Thank you. Ladies and gentlemen, due to time constraint we take the last question from the line of Aditi Nawal from RSPN Ventures. Please go ahead.
Aditi Nawal
Yeah, thanks for taking my question again. I just needed to know what is your SMB client number at the end of this quarter?
Kapil Makhija
Sorry, the question was about SME clients.
Aditi Nawal
SMB, yeah, small and medium business clients.
Kapil Makhija
So the SME clients we’ve invested in the short term to drive sales in our SME business. And while our Overall base is 7,000 plus clients within that SME clients on our flagship platform Univair are 3,000 plus. They have demonstrated a growth compared to previous quarters and we continue as we now have multiple platforms to be able to offer to the SME ecosystem in the form of Courier, Aggregation, ConvertPay. Along with Univer, we want to continue to drive growth in our overall client base.
So today the client base has increased to 7,000 plus businesses and will continue to drive growth in that client count as well.
Aditi Nawal
Got it. Back to question. That’s the client.
Operator
Thank you. As there are no further questions, I now hand the conference over to Mr. Kapil Makhija for his closing comments.
Kapil Makhija
Thank you everyone for joining the call today. We hope we’ve been able to address your queries. Should you have any further queries of clarification, please feel free to reach out to us, our strategic growth advisors, our investor relations advisor. Thank you and have a good day.
Operator
Thank you. On behalf of Unique Commerce eSolutions Ltd, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.