SONATSOFTWNSE24 January 2023

Sonata Software Limited has informed the Exchange about Investor Presentation

Sonata Software Limited

24th January, 2023

National Stock Exchange of India Limited Exchange Plaza, Bandra Kurla Complex, Mumbai Kind Attn: Manager, Listing Department Stock Code – SONATSOFTW

BSE Limited P.J. Towers, Dalal Street, Mumbai Kind Attn: Manager, Listing Department Stock Code - 532221

Dear Sir/Madam,

SUB: INVESTORS’ PRESENTATION

Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we are enclosing Investors’ Presentation for the quarter and nine months ended 31st December, 2022.

The above said presentation is also made available on the Company’s website www.sonatasoftware.com.

Please take the same on record.

Thanking you,

Yours faithfully, For Sonata Software Limited

Mangal Kulkarni Company Secretary, Compliance Officer and Head – Legal

Encl.: As above

1/4, APS Trust Building, Bull Temple Road, N. R. Colony, Bengaluru - 560 019, India Regd. Off: 208, T. V. Industrial Estate, S. K. Ahire Marg, Worli, Mumbai - 400 030, India Tel: +91 80 6778 1999 | Fax: +91 80 2661 0972 | CIN: L72200MH1994PLC082110

Website: www.sonata-software.com email: info@sonata-software.com

Sonata Software

Investor Presentation

Q3 FY’23

PlatformationTM Makes the Difference

www.sonata-software.com

Sonata At A Glance We are a Modernization and a Digital Engineering company powered by our unique PLATFORMATION™ framework.

The Company

35 YEARS IT Solutions Provider

$850+M Revenue 18% CAGR across 10 years

Public Listed (SONATSOFTW) Debt-free; Robust Balance sheet

5700+ Employees Across US, EU, Asia & ANZ Powered by Unified Engineer Program (UEP)

Delivering Outcome based Modernization Services

Cloud

Data & AI IOT

Infrastructure

ERP – SAP, Dynamics, Oracle

Digital engineering, AMS, Mobility and Quality Assurance

Digital Transformation Using PlatformationTM

Customer Experience - UI/UX, Angular/React

Industries

TMT

Healthcare

Manufacturing

Retail / CPG/TTH

BFSI

Emerging

Ecosystem: Partnerships Tech + Domain

Microsoft

SAP

IBM

ServiceNow

Snowflake

Google Cloud

AWS

Stanford AI Labs

SFDC

Domain Partners

Innovation: IP & Accelerators

LightiningBuild

StoreEz

KODO CX

Sustainability Target - Carbon Neutrality by 2030

• 10% Reduce Energy consumption in FY 22-23 • 10% Increase Renewable energy/REC mix in FY 22-23.

Notable Sustainability initiatives

Serving our Global Clients with Right Talent Mix (Global & Local Talent)

Canada

UK (London) & Ireland (Dublin)

Europe Netherlands, Denmark, Germany

Redmond Development Center

North America Atlanta, GA Fremont, CA Bridgewater, NJ Florida

Mexico

Eastern Europe

Middle East & Africa Qatar, Dubai

APAC China Japan Korea Philippines Thailand Vietnam Singapore Malaysia

Indonesia and Phillipines

India Development Centers: Bangalore (3) Hyderabad (2), Chennai Offices: Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Pune, Mumbai

Australia Brisbane, Sydney Melbourne

Development Centers & Sales Offices - 21

Partners - 5

Global Delivery centers recent/InProgress - 6

Sonata Software Limited declared winner of the prestigious ‘Golden Peacock Award for Excellence in Corporate Governance’ for 2021 & 2022

Performance vision for Sonata

SCALE – Key Drivers

Harvest

Microsoft sell-to; Dynamics

Sustain SITL momentum

SSL : Invest –

Invest

» New verticals, 6 geos, Sales and functions, Large Deals and Large Accounts » Build Partnership beyond Microsoft - AWS, Snowflakes, SFDC, ServiceNow

SITL : Build e2e accounts, focus on Cloud & Data in the geo

Inorganic growth

Diversify

Continuously evaluate acquisition opportunities with (scale) accounts

Clients: Focus on portfolio diversification. Build multiple large accounts.

Brand: Global brand in Modernization

Sonata’s approach to Modernization

Sonata’s Modernization Services helps in creating digital businesses with connected ecosystem to realize business agility, scalability, and improved efficiencies with our unique Platformation approach.

Domain-Led Modernization ♦ Technology Modernization

Game Plan

Anchored By GTMs

Enabled By

Executed through

Harvest

Dynamics

Accelerate

AWS, GCP, Snowflakes

Expand

SFDC, Service Now

Cloud Modernization

Scale Access

Data Modernization

Dedicated Alliance leads, Branding, Demand generation

Dynamics Modernization

Automation

Shape & Expand

Front end Consulting

Managed Services

Scale Execution

PLATFORMATION™ Platforms - the secret behind the digital economy’s most successful companies

OPEN

SCALABLE

Invest

Contact Centre Modernization

People and Delivery Capability

CONNECTED

INTELLIGENT

Web3, Meta, Industry Cloud

Performance vision for Sonata – Plan for 4 years

Strategy

Grow Verticals

• Harvest - TMT, Manufacturing, Retail/TTH •

Invest - Healthcare, BFSI

Grow Markets

• Harvest in US- West, UK, India and Australia •

Invest: US-East, Nordics

Grow Solutions & Partnerships

• Build and acquire:

o Top horizontal GTMs : Cloud Modernization, Data Modernization, Managed Cloud, Automation

o Top 6 partners: MS (harvest), AWS, SDFC, Snowflake,

ServiceNow/Google

Large: Accounts & Deal

•

Invest - o Central Hunting team, specialist skills, hunters in accounts to open new LOB’s,

global delivery centers, new account specific capabilities.

o NBD Deal Origination (Rainmakers) and Deal Desk

• Harvest Existing accounts to generate Large Deal Pipeline

Brand

• Engage a premier partner for building out our Brand Invest with Analysts - move up on the Quadrants • Invest in identified campus / country specific plans to Influence applications • campus and lateral hires through brand building and social media

Talent

Invest to build talent, capabilities and culture required for winning in a global market and deliver sustainable growth for all

Outcome based Modernization Services

Business Architecture Consulting – E2E Service Design

Platform Technology Architecture and Validation

Digital Realization services

Digital Engineering Services

Cloud Services

Managed Services

Big Data & Analytics

• Mobility • • AI/ML • Omni Channel Commerce • Automation • Data structure and Algos • Digital Assurance • • Web 3.0

Internet of Things (IoT)

Infrastructure Services

• • Network & Security • •

IT Infrastructure Modernization Business Productivity & Collaboration Cloud Provisioning, Onboarding Cloud Management Enterprise Service Desk

• • •

• Application Management

Building Custom applications

• • Application management • ERP Implementation & Roll Outs SAP, Oracle and Dynamics •

Cloud Engineering

•

• Managed Services

Strategic Partnerships –Microsoft, AWS, GCP, Snowflakes, SFDC

Partners

Modernization & Migration

Managed Services

Data Platforms and Intelligent Apps

Offerings

Cloud Native Development

Data Engineering & Operations

Industry led Transformation

AI First - Transformation for Digital business

Optimization, Performance optimization, Automation

Assessment, Consulting and Solutioning

Certified Competencies

Differentiators

Data Analytics

Dynamo DB

AWS WAF SDP

AWS-DynamoDB to Google- Data Store

18 characteristics-based Snow Reference

Dynamics 365

Teams

AWS-Lambda Function to Google Function For Python, NodeJS. Clojure

MCR

Web Apps

Microsoft Azure Expert MSP

Lambda Services

SAP on AWS

AWS Config

API Gateway

Azure

Windows Workload

Snowflake DevOps using Sqitch

Azure to GCP for Infra, Data and Apps

Test Automation

Microsoft FastTrack

Lightning Data Suite

Clarinet Audit Tool

D2 Design to Deployment

Extensive experience in complex data ingestion and transformation across industries (TMT, Retail/CPG/TTH, Manufacturing, BFSI, Healthcare )

Microsoft Relationship – Jointly driving Customer Success

30 Years MICROSOFT PARTNER

400+ Clients ACROSS THE GLOBE USA, Europe, Asia, India, Australia, Middle East

$350+ million/annum REVENUE TO MICROSOFT 21.9% YoY Growth , Cloud Mix 73.4%

2500+ TEAM On Microsoft Technologies

18 Gold CERTIFIED COMPETENCIES 10 ADVANCED SPECIALIZATION Dynamics 365, Microsoft Azure Expert MSP, Data Analytics, Teams, CAF, M365, Azure

JOINT EXECUTION

Microsoft FastTrack, Global Delivery, Microsoft Consulting Services

CATALYST LED SALES PROCESS Industry Point of View, Business Value assessment, Envisioning Workshops, Design Thinking

INDUSTRY CLOUDS GO TO MARKET Retail, Sustainability, Manufacturing

INDUSTRY DIGITAL TRANSFORMATION

Retail, CPG, Manufacturing, Telecom, Healthcare, Hi-Tech, BFSI

Life of a Sonatian – a home away from home!

Vision & Values aligned to individual purpose Customer & People success, Innovation, Winning teams, Growth mindset, Diversity & Inclusiveness, Social citizenship

Constant upskilling & training

~10% of workforce upskilled through cross-training

~60% covered through Unified Certification Programs

Diverse & Inclusive workplace Employees of more than 17 nationalities thriving and contributing to our success

Robust Employee Engagement & listening systems

>80% score on Sonatian Experience; leading to lower attrition

Career Growth

>70% of leadership (SM) grown from within

Avg. tenure: Senior management ~13 yrs and middle management ~9 yrs

Success Stories (1/3)…Flight to the Future

The client, Europe’s largest multinational leisure, travel, and tourism company, operates over 150 aircraft, 16 cruise ships, and 381 hotels. With a market capitalization of €10B, the company sought to expand rapidly in multiple new geographies. It needed a partner who could help it modernize and develop high scalability capabilities.

Client Overview

Industry Travel and Tourism

Revenue $18.53 B

Customers >20M

Lines of business 6

Destinations 180

The Pressure Points

Solutions

Results

Disparate monolithic systems across multiple markets

Lack of real-time pricing & configurable dynamic packaging

Volatile sales volumes

High infrastructure and operations costs

Traditional methods of margin/pricing calculations

•

Creation of modernized BI with a cloud-based on-demand warehousing solution

Development of a data mesh and innovative ML models on AWS for domain-centric services

Implementation of serverless adapters and intelligent caching for dynamic flight combinations

Implementation of a modernized “selling platform” on AWS

Execution of end-to-end automation with DevSecOps and DataOps

Seamless business records (>1B) processing for recommendations

•

6861 Peak day bookings

• +35% Increase in search performance

• +10% Increase in page load performance

• +100% Infrastructure availability

•

-41 Reduction in customer complaints

• +15% Increase in traffic volumes

Success Stories (2/3)…House In Order

Founded in 2008, the California-based client is a financial services company that specializes in the origination, acquisition, and servicing of mortgage loans. The company operates through two primary business segments: loan production and loan servicing

Client Overview

Industry Banking and Financial Services

Revenue $3.7 B

Assets $31.6 B

Employees 6,400

The Pressure Points

Solutions

Results

Redundant and inaccurate data

Inability to handle data volumes

Slow processing

High maintenance costs

Poor scalability

•

30% Reduction in TCO

99% SLA support

100% In-sprint automation

• Modernized data infrastructure on AWS

•

Data marts for department specific needs

Templated pipeline solution for data governance

• Master Data Management to improve data

quality

•

Scalable report processing model

Granular, access level security

Success Stories (3/3)…In Good Health This American healthcare multinational started off in the late 19th century, making surgical supplies and household products. This Fortune 500 company is organized into three business segments: Consumer Health, Pharmaceutical and Medical Devices. As one of the largest healthcare companies, in the world, it spends a significant amount of money on research and development - $ 14.7 billion in FY 2021 alone.

Client Overview

Industry Healthcare

Presence in countries 260+ operating companies across 60+ countries

Group Revenue ¥661 B

Employees 14,000

Manufacturing units 100+

The Pressure Points

Solutions

Results

The client was using over 800 applications across multiple geographies, which made it difficult to manage and maintain.

These applications included several mission-critical ones, meaning that any downtime or issues with them could greatly impact the business operations

The client faced challenges in maintaining consistency and quality across the multiple applications and geographies.

The client also faced challenges in managing and automating the testing and deployment processes for the multiple applications

•

Functional testing

Platform testing

Server Management Tool Upgrade

Data Migration

Application Retirement

•

Annual cost savings of over $2 M

700+ Projects in delivering 4800+ Scripts

70+ Servers managed

4 Major upgrades with 0 downtime

800+ Applications tested

70% Improvements in response time and scalability

Key Deal Wins in FY 23 We have added new clients across different industries – TMT, BFSI, Mfg, and Retail. We will continue to focus on Enterprise clients to accelerate our growth across the markets we operate.

Deal Win #1

Deal Win #2

Client: An Organization with revenue >1.5B improves road safety for motorists. Headquartered in Brisbane it serves approximately 1.75 million members.

Client: One of the largest electric utilities companies in the USA with operating revenue of $14.9B and over 13K+ employee. Customer delivers power to 15 million people in 50,000 square-miles across central, coastal and Southern California.

Problem: Customer runs their core systems on legacy platforms limiting their ability to scale and provide enhanced member experience and does not allow customer to meet their compliance requirements

Problem: Customer needs to provide “criticality of continuity” for the delivery of field service management and wanted to automate mobile workforce management and improve service optimization/scheduling.

Solution: We are building a single platform of the future solution to modernize & transform the core business application suite, creating an Omnichannel and connected organization with a customer 360-degree view. We will bring our expertise & skills CRM, Azure, AWS and Data to deliver the required outcomes for this client.

Solution: Sonata proposed a solution to design, develop, and implement a new platform aided with strong relationship with tech partner throughout the evaluation process that helped to win the deal. We will help transform SCE’s servicing model and improve field force productivity immensely.

Financial Management

Realization & High margins

DSO

Cash Management

Returns %

Sound capital allocation

Focus on high revenue rate realization and high margins business

Focus on Reduction of DSO days with efficient working capital management

Improved Int. EBITDA Margins from 26.3% in FY 20 to 27.6% in FY 22

Improved DSO from 44 days in FY 20 to 37.5 days in FY 22

Very strong positive cash generation and cash position.

Company is maintaining a liquidity of ~Rs. 600+ cr at all the times

Industry leading ROCE and ROE

Improved ROCE from avg 30.6% in FY 20 to avg 37.4% days in FY 22

Sound capital allocation with judiciously

Company has paid a dividend of Rs. 221 cr highest in its history.

Consistent Growth Over Last 10 years

Consolidated Revenue & EBITDA

Revenue

EBITDA

PAT

CAGR 17%

5,553

4,228

3,743

CAGR 28%

431

407

366

2,961

2,371 2,454

1,941

1,566 1,682

1,311

239

246

278

191

117

566

376

CAGR 32%

192

159

156

134

277

249

244

FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 21 FY 22

International Services Revenue & EBITDA trend for last 12 Quarters

Revenue (in Crs)

EBITDA (in Crs)

490

460

437

414

395

330

325

276

288

301

361

319

324

114

116

111

123

119

103

Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23

Financial Performance of International Services – Q3 FY23

Revenue in INR. Cr

EBITDA

395.2

460.4

489.6

e r o r C n

R N

Q3 FY22

Q2 FY23

Q3 FY23

6.3% QoQ

23.9% YoY

Revenue in $ Mn

PAT

4.8% QoQ

13.3% YoY

3.2% QoQ

11.4% YoY

3.4% QoQ

14.2% YoY

110.5119.3123.227.3%25.7%24.7%0.0%5.0%10.0%15.0%20.0%25.0%30.0%35.0%0.020.040.060.080.0100.0120.0140.0160.0180.0200.0Q3 FY22Q2 FY23Q3 FY23INR in Crore71.278.681.3 17.6%16.9%16.3%-10.0%-5.0%0.0%5.0%10.0%15.0%20.0%0.020.040.060.080.0100.0Q3 FY22Q2 FY23Q3 FY23INR in Crore$53.4$57.8$60.5$46.0$51.0$56.0$61.0Q3 FY22Q2 FY23Q3 FY23 International Business Revenue Growth

Utilization

New Customers added

Client Concentration

No. of $ Million Customers

82.0%82.0%84.2%50.0%60.0%70.0%80.0%90.0%100.0%110.0%Q1 23Q2 23Q3 2312101220579111315171921Q4 22Q1 23Q2 23Q3 2363%58%55%71%65%66%0%20%40%60%80%Q3 22Q2 23Q3 23Top 10 CustomerTop 20 Customer36 39 46 20 25 30 35 40 45 50 Q3 22 Q2 23 Q3 23Operational Performance

Revenue by Geography

Constant Currency

120%

100%

80%

60%

40%

20%

22%

23%

55%

25%

19%

56%

27%

20%

53%

Q3 22

Q2 23

Q3 23

USA

Europe

Rest of World

53.860.863.28.7%3.9%3.9%-0.15-0.1-0.0500.050.14045505560657075Q3FY22Q2 FY23Q3 FY23Revenue ($mn)% QoQ GrowthVertical Mix Q3 FY 23

Revenue Share - 3Q FY23 – Current Classification

Revenue Share - 3Q FY23 – New Classification

Industry Vertical% Revenue in Q3 FY 23ISV36%Distribution & Manufacturing22%Others12%Retail12%Travel8%Commodity business & Service Industry4%Heath Care4%Logistics3%Total100%36%22%12%12%8%4%4%3%% Revenue in Q3 FY 23ISVDistribution & ManufacturingOthersRetailTravelCommodity business & ServiceIndustryHeath CareLogistics33%18%21%11%7%9%% Revenue in 3Q FY 23TMTManufacturingRetail, CPG, TTHEmergingBFSIHealthcareIndustry Vertical% Revenue in 3Q FY 23TMT33%Manufacturing18%Retail, CPG, TTH21%Emerging11%BFSI7%Healthcare9%Total100%Solutions Mix

Revenue by Top GTMs

30%12%35%4%18%Q3 FY 22 Cloud Data Dynamics Others Emerging Tech31%14%33%5%16%Q2 FY 23 Cloud Data Dynamics Others Emerging Tech32%13%37%3%16%Q3 FY 23 Cloud Data Dynamics Others Emerging TechDomestic Business - Revenue

Domestic Revenue (Annuity/Others)

Domestic Revenue (Cloud/Others)

120%

100%

80%

60%

40%

20%

25%

24%

25%

24%

75%

76%

75%

76%

Q3'22

Q4'22

Q1'23

Q2'23

Q3'23

% of Revenue - Annuity Biz

% of Revenue - others

Domestic business major revenue contribution from multi year annuity enterprise sale

78%78%76%77%78%22%22%24%23%22%0%20%40%60%80%100%120%Q3'22Q4'22Q1'23Q2'23Q3'23Cloud Revenue %Others Revenue %Domestic Business:– Last 12 Quarters (In Crs)

CQGR 3.9%

Gross Contribution

56.7

53.6

50.8

47.4

45.1

36.0

33.0

30.0 30.1

38.0 38.1 38.0

39.9

CQGR 5.6%

EBITDA

CQGR 6.0%

PAT

51.7

47.1

44.0

39.5

36.9

31.8 32.4 33.7

27.3

27.0

23.2

19.6

16.9

18.1

16.6

13.6

12.4

11.6

36.3

34.1

31.8

28.5

26.4

22.6 23.0 23.9

Q3 20

Q4 20

Q1 21

Q2 21

Q3 21

Q4 21

Q1 22

Q2 22

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

Q3 20

Q4 20

Q1 21

Q2 21

Q3 21

Q4 21

Q1 22

Q2 22

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

Q3 20

Q4 20

Q1 21

Q2 21

Q3 21

Q4 21

Q1 22

Q2 22

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

International and Domestic ROCE & RONW

ROCE

RONW

50%

40%

30%

41%

43%

41%

42%

39%

38%

39%

37%

49%

50%

46%

40%

39%

38%

37%

50%

40%

30%

20%

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

International Business

Domestic Business

International Business

Domestic Business

Days Sales Outstanding

International Business

Domestic Business

36363738434041464505101520253035404550Q3 21Q4 21Q1 22Q2 22Q3 22Q4 22Q1 23Q2 23Q3 23International Services DSO5749393233383837380102030405060Q3 21Q4 21Q1 22Q2 22Q3 22Q4 22Q1 23Q2 23Q3 23Domestic Services DSOCredit Management – Domestic Business

Revenue

Net working Capital

1,771

1,099

S R C S R N

I T N U O M A

946

761

606

1,464

1,343

1,051

1,041

175

203

219

190

175

211

162

204

196

Q3 21

Q4 21

Q1 22

Q2 22

Q3 22

Q4 22

Q1 23

Q2 23

Q3 23

THANK YOU

PlatformationTM Makes the Difference

www.sonata-software.com

← All Transcripts SONATSOFTW Stock Page →

Sonata Software Limited has informed the Exchange about Investor Presentation

Market Movers