AURIONPRONSEQ2 FY 2022-23November 1, 2022

Aurionpro Solutions Limited

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Key numbers — 19 extracted

rs,

sonable. Forward looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance or achievements of the compan

155 crore

w very strong growth in the key metrics on a year-on-year basis. Revenue for the quarter stood at 155 crores is a 26% year-on-year growth and 6% on a Q-o-Q basis. This is solidly in line with the company's

26%

owth in the key metrics on a year-on-year basis. Revenue for the quarter stood at 155 crores is a 26% year-on-year growth and 6% on a Q-o-Q basis. This is solidly in line with the company's estimat

year-on-year basis. Revenue for the quarter stood at 155 crores is a 26% year-on-year growth and 6% on a Q-o-Q basis. This is solidly in line with the company's estimates for FY23. EBITDA for Q2 FY

35 crore

basis. This is solidly in line with the company's estimates for FY23. EBITDA for Q2 FY23 stood at 35 crores as compared to 27 crores in Q2 of FY22, which is a growth of more than 30% on a year-on-year bas

27 crore

line with the company's estimates for FY23. EBITDA for Q2 FY23 stood at 35 crores as compared to 27 crores in Q2 of FY22, which is a growth of more than 30% on a year-on-year basis, and again a 6% sequen

30%

Q2 FY23 stood at 35 crores as compared to 27 crores in Q2 of FY22, which is a growth of more than 30% on a year-on-year basis, and again a 6% sequential Q-o-Q basis. EBITDA margins for Q2 stood at

22%

-on-year basis, and again a 6% sequential Q-o-Q basis. EBITDA margins for Q2 stood at a healthy 22%, which is comparable to the level we've been at in Q2 FY22 as well. Profit After Tax, Q2 FY23 sto

25 crore

h is comparable to the level we've been at in Q2 FY22 as well. Profit After Tax, Q2 FY23 stood at 25 crores, which is a growth of 32% on a year-on-year basis, and on a Q-o-Q basis that the growth of more

32%

ve been at in Q2 FY22 as well. Profit After Tax, Q2 FY23 stood at 25 crores, which is a growth of 32% on a year-on-year basis, and on a Q-o-Q basis that the growth of more than 4%. The margin for pro

ich is a growth of 32% on a year-on-year basis, and on a Q-o-Q basis that the growth of more than 4%. The margin for profit after tax stood at 16%, which is higher by 100 basis points if you compare

16%

s, and on a Q-o-Q basis that the growth of more than 4%. The margin for profit after tax stood at 16%, which is higher by 100 basis points if you compare year-on-year. On a half yearly basis, the com

Guidance — 20 items

Ashish Rai

opening

“Going forward, we plan to continue such engagement regularly for every quarter as we go through.”

Ashish Rai

opening

“Another key part of our growth strategy over the last few years was to de-focus from businesses which either did not fit the target segments or the target economic profile.”

Ashish Rai

opening

“So going forward, we will continue to focus on strengthening the economic moat that we have in these businesses through the IP edge, and keep executing with discipline so that we capitalize fully on the really large, long term growth opportunities that we see in front of us.”

Ashish Rai

opening

“We've seen some inordinate delays in arrival of materials due to global supply chain disruptions in some large product and execution, which ultimately delayed the project milestones and billing.”

Ashish Rai

opening

“And we are fully on track to complete acquiring 100% ownership of SC Soft in Singapore in the next few months.”

Ashish Rai

opening

“We expect to finish the year with a significantly stronger balance sheet to the combined effect of one strong second half that we can see a full resumption of the normal business cycle across all the segments and completion of these strategic investments that we talked about.”

Ashish Rai

opening

“We continue to see very strong demand across the key segments and as a business we remain focused on continuing the growth trajectory through the year and into the next year.”

Management

“And we continue to see very strong demand, we've been growing capacity in the business and I'm sure it will be a strong driver of growth for us going forward.”

Umesh Matkar

“And also if you could quantify on the opportunity that you see on the segments that you have mentioned, that would be great, to what is the pipeline going forward for the segments?”

Management

“If I quantify the target addressable market, it would be a very large number.”

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Risks & concerns — 2 flagged

So do we see increasing in maybe US and that might so how would we just a geographical level we might be seeing slowdown somewhere or something.

— Darshil Zaveri

So on talent, up a few points, One, we face less challenge around talent as compared to some of the or a large part of the IT industry which are the most services focused players, we on a productivity basis because we drive a much higher productivity given the IP that we've built out, for us the talent challenge is actually not as serious overall, but of course we are growing at +30% for some time, so we do need to keep growing the talent base.

— Management

Q&A — 7 exchanges

I have just two questions. First, if you could provide the breakup of order book segment wise as on date. And also in data center, we are seeing huge investments like the UP government inaugurating its first hyper scale data center. So what sort of opportunity do you see in data center, as well as in other segments like kiosk Murex, smart city and smart mobility? Thank you.

Management

Thanks Umesh, great question. Thanks for joining the call. So let me start with the data center question first. So as those who've been tracking the business would have known we got into this business over the last couple of years and over time, we've brought together a very strong set of capabilities. One of the most respected teams in the country, as well as some serious IP that we are building out in this space. So we've been going out and logging a number of very notable wins in this space. You are totally right, this is a space which is seeing explosive demand, there is a lot of investmen

Sir, my first question was, SC Soft we were one of the three vendors selected in California mobility marketplace. So two parts in this question, one was how is the response that you're getting from the local transport authority there, and the second part was here applying for both processing and validator suppliers, but we were selected only in validator segments and not in transaction processing segments. So what was the reason for the same?

Management

Okay, so that’s a very good question. So, when we were getting into the RFPs, we chose to participate on the validator side of the business because of the relationships that we had and the POCs that we had done to support it right, we did not participate on the other side of the business due to strategic reasons on the bit. So we see very good progress in terms of rollout on that contract. So it was obviously a very competitive win for us and now that we are in California, and I may be off by this in a little bit, but give or take 300 transit operators, and we are already on the rollout of the

So my question is about our long term vision which maybe in the next three years, where do we envision ourselves because we've been growing at a good rate and we have made some decent acquisitions also. So what kind of growth lever do we look for in the next upcoming three years or a long term plan that would be helpful?

Management

Okay, good afternoon Darshil and thanks for the question. So what we have done so far right, and I covered some of it in my opening remarks, we are building out a global IP led products and platforms provider. We chose a few segments to operate in, each of these, we believe our segments with one very large demand runways. Second, we believe fragmented or uncontested leadership in some of those spaces. So, I don't see it as a demand which will go away in let's say three years or five years or 10 years this is very long term very, very long demand run rate. So we chose those segments, this is ba

Sir, I have one bookkeeping question in your opening remark you mentioned our receivable has gone up due to increase in revenue or some delayed in the business. So can you throw some more light on this, what will be our normalized revenue by this year or which segment has led to increase in receivables?

Management

Yes, so it doesn't really impact the revenue per se, because project execution by and large, it affects it slightly but not hugely, the project execution by and large goes on. What I meant there was, we are in the middle of executing some very large projects and in the quarter we faced. So these projects include material that we need to secure from some OEMs, these are very large reputed global OEMs. And we faced or they faced temporary supply chain disruptions in the quarter which delayed the arrival of that material, and hence delayed some of those projects. We are working through those and

Sir I've very recently started to look at your company, so I have may have few basic questions, so apologies. Sir, just wanted to understand what is it that comprises in the revenue for sale of software services, and sale of equipment and product license, if you could just help me understand the difference?

Management

So, those two categories the sale of products, the sale of software services is essentially any services that go into enabling our products to the end client. So this will include implementation services, this will include ongoing enhancement and customization services. And this will include the AMCs that go with the software that we sell. So any services required in enablement of the software and the overall offering that we sell so that is it any services. The product and licenses is essentially the one off sort of payments that the client makes to acquire the rights to use this, so which is

So my first question is regarding the link of a talent pool, because now as we are moving to next phase of course we have a lot of challenges on talent pool, with a strong technological background, so how we are going to sustain that capability and build a strong growth for ourselves. Is there any strategy at high top management level, to build a trajectory so that we can be assured of meeting the growth in our future, can you please explain sir.

Management

Great question thanks Ganesh. So on talent, up a few points, One, we face less challenge around talent as compared to some of the or a large part of the IT industry which are the most services focused players, we on a productivity basis because we drive a much higher productivity given the IP that we've built out, for us the talent challenge is actually not as serious overall, but of course we are growing at +30% for some time, so we do need to keep growing the talent base. We feel we have become one of the more attractive places for the right kind of talent to come in and join. Why is this, t

Okay, thanks. So, thank you everyone for joining the earnings call. We recognize we've hosted this after some time, going forward, the intent is for us to build out on this and host a call every quarter. The goal that we have as a management team is to build out as transparent a mode of communication with our shareholders as we can and as we go out into the future, which we feel very, very optimistic about. We will continue to share a lot more information with the participants and with the investor community, both through the formal releases and announcements that we make as well as more of th

Management

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Speaking time

Management

Moderator

Swechha

Umesh Matkar

Darshil Zaveri

Umang Shah

Hiten Boricha

Ashish Rai

Ganesh Shetty

Aashvi Shah

Opening remarks

Aashvi Shah

Thank you, Michelle. Before the call, we would like to point out that certain statements made in today’s call maybe forward looking in nature. And the disclaimer to this effect has been included in the earnings presentation shared with you earlier. The investor call may contain forward looking statements based on the currently held beliefs and assumptions of the management of the company, which are expressed in good faith and the opinion reasonable. Forward looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance or achievements of the company or industry results to differ materially from the results, financial condition, performance or achievements expressed or implied by such forward looking statement. The risks and uncertainties relating to these statements include, but are not limited to risks and risks for expansion plans, benefits from fluctuations in our earnings, our ability to mana

Ashish Rai

Thanks, Aashvi. Good afternoon everyone. Welcome to the earnings call for Q2-FY23. This is my first interaction with you since my appointment in the last quarter. The company has so far of course been communicating actively with the investor community through releases and announcements, but we've not held an interaction like this for a long time. Going forward, we plan to continue such engagement regularly for every quarter as we go through. Before we get into the financials, let me spend a few minutes to update you on the developments within the firm. Over the last three years that we've not posted a call like this before. Three years back, we started our current journey to revisit our strategic direction, and focus on building out a global IP led products and platforms provider, sharply focused on a few chosen segments. These segments are banking, smart mobility, payments and smart cities. This strategy leveraged heavily on our established track record and capabilities in working wit

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