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00:00We have the Management of Updater Services with us.
00:03Just to give you a sense of how the company fared in the Q4,
00:06the revenue was about 10.5% up,
00:09while EBITDA saw about a 26% growth,
00:11while margins saw about a 78 basis point of improvement,
00:15and net profit about a 150% of jump here.
00:18But to discuss more, we have the management,
00:20the Chief Managing Director,
00:22Raghunandana Thangirala with us.
00:24Hello and welcome to the show.
00:27Hello, thank you for having me.
00:28My first question to you is on the revenue growth
00:31that we are looking at.
00:32FY24, the revenue was about 16% up,
00:35while Q4, about 11% of growth we have noticed.
00:38What is the sustainable rate or revenue growth
00:41that we are looking forward in FY25?
00:44Yeah, I told her this earlier,
00:46we are looking anywhere between 15 to 18% growth in revenue,
00:50and also in terms of our profits are packed.
00:54Absolutely, and now if I want to take your margins
00:56into consideration, you have specified
00:59that you're looking for about a 25 to 50 basis points
01:01of improvement.
01:02Well, this is on the back of the improving mix
01:05that you're seeing on the BSS side.
01:06So can you elaborate over your,
01:08how the margins are different between the two segments?
01:13Sure, BSS historically and also going forward
01:16would be about between 12 to 13% margins, blended.
01:22And the IFM segment would be on the range of 5, 6% margin.
01:26We would want to increase this mix,
01:28that means more of BSS.
01:30This could happen organically and also inorganic.
01:33If you would remember, we had raised money for inorganic,
01:37which we would be definitely,
01:38we've targeted two, three companies.
01:41Probably in the next couple of quarters, we will do that.
01:44So our share of BSS would go up,
01:46that is the high margin business.
01:49Absolutely, and can you mention what is the kind of share
01:52we are looking at?
01:52Because if your current mix,
01:54it suggests about 67% comes from the IFM.
01:57So what is the kind of mix that you're looking for?
02:00Yeah, today we are at about 67 or 65, 35.
02:05We would want to make it 60, 40.
02:0760 from IFM, 40 from the BSS.
02:10Absolutely, and in the BSS vertical,
02:13if I want to delve deeper into it,
02:14in which BSS segment, in which vertical
02:17are we looking at this growth coming in from
02:19and higher margins going forward?
02:22Yeah, if you look at largely our BSS segment
02:25consists of lead generation
02:28or the sales enablement services.
02:31Then we have airport ground handling concessions.
02:34We have also a supply chain audit services.
02:37So we would look at in these three spaces
02:40for acquisition and also organic growth.
02:44Absolutely, now over here,
02:47if I were to notice the employee expenses,
02:50they have shifted higher in the fiscal
02:52compared to last year.
02:54I wanted to understand what is the reason for this
02:56and is this expected to continue forward as well?
03:01Good question.
03:02Yeah, it did go up if you look at last quarter
03:05and it could remain the same percentage this first quarter.
03:09This is because of our ramp up in business.
03:11We invest a little more in the ramp up phase
03:14that is quarter one, quarter two
03:17because of people and investment into that.
03:20This will kind of even out
03:21in the second and third, fourth quarters.
03:23So it would come down actually if you look at it,
03:26but it would look like it is higher
03:27by a marginal percentage now.
03:31Sure, so next two, three quarters,
03:33we expect them to go down.
03:34But now I want to shift the focus again
03:37to the recent acquisitions that we've made in the past
03:39that includes the Athena and the Denawe.
03:41I wanted to understand from you,
03:43what is the, how is the performance shaping up over here
03:46and you are also increasing your stake going forward.
03:49So just wanted a breakdown on these two.
03:53Yeah, Denawe would become 100% I think anytime now
03:57because the results are out.
03:59So Athena would become 100%.
04:01Today we are about 57%.
04:03The stake will go up to 76 this quarter
04:06and eventually next year we will get 100%.
04:10Now, yes, both Athena and Denawe
04:11have been flat last quarter.
04:14We see a pickup happening in the first and second quarter.
04:18Both would, okay, to just put it simple,
04:20we both segments will grow between 15 to 18%
04:23on a full year basis.
04:2615 to 20% growth from both the segments coming in from you.
04:29You mentioned-
04:3015 to 20% growth, both segments put together
04:33on a full year basis.
04:34Oh, all right, on a full year basis.
04:37Now you've mentioned about other inorganic growth
04:39opportunities also.
04:41Wanted to understand,
04:42is this going to be from the B2B side as well
04:45or is it from, we can shift focus
04:47to the residential real estate market?
04:49Where are we seeing these inorganic growth opportunities
04:52coming in from?
04:54The inorganic would happen only in the BSS space,
04:57which is a higher margin space.
04:58It will not happen in the IFM space.
05:01They've always remained B2B.
05:03So, but we could look at the residential space
05:06in the IFM space.
05:08We could look at if it is a high-end market residential,
05:11but so far we don't have any residential.
05:14We could look at it.
05:14But to answer your question,
05:16the inorganic will happen only in the BSS space.
05:20So BSS space it is.
05:22And do you plan to raise funds
05:24to make these sort of acquisitions going forward?
05:28As you remember,
05:29we'd already raised about 80 odd crores in our IPO.
05:32So organically the business also throws up
05:34about 100 odd crores.
05:36Even last year we did that.
05:38So it could be between the acquisition,
05:40between the money which we have accrued
05:44and what we have raised about 80 crores for this.
05:46All right.
05:47And now I want to ask you about the airport ground services
05:50you've just initiated over here.
05:52What is the kind of outlook that we should expect
05:54from this business going forward?
05:58Yeah, airport ground running is a construction.
06:01We have a 10-year construction with this airport.
06:03We currently have about 22 airports.
06:06We have airports like Ayodhya, Tirupati, Pune.
06:10We have 22 B and C airports.
06:13All this will start kicking in
06:14from the second quarter of this year.
06:16And we look that we are very bullish on that
06:19because the airport and aviation business
06:21is growing at about 20%.
06:23We think we will also grow much higher there
06:25in the airport business.
06:27Absolutely.
06:28Thank you so much for joining
06:29and we'll stay tuned for more such performance
06:32coming in from updater services.
06:35Thank you once again for joining.
06:36Thank you.
06:37Thank you for having me.
06:38Thank you.