Key Highlights

Net sales for Dec 18 qtr was down by 1% QoQ. Apart from seasonality and lower number of working days, lower execution of Mauritius govt order led to lower sales.

The Phase 1 of Mauritius govt which was at Rs 60 crore of value got over in Sep 18 qtr and although the company has received the Phase 2 of the order, the value is only Rs 30 crore.

The company won 13 new clients in Dec 18 quarter. This includes one in manufacturing sector providing end to end digital platform, online payment gateway solutions for a US software company and others in healthcare, BFSI and IT networking segment.

The company had sold off a subsidiary in June 18 qtr, so on 9 mths basis, on a like to like comparison the growth would be around 18-20% in sales as compared to a 10% reported growth.

The company has significantly ramped up its India hiring to cater to increased demand from existing clients and it is also witnessing good upcoming demand from Non-government related companies in India. Around 100 new employees will be recruited in Mar 19 qtr. So while the employee cost will increase, the business proportionately will also increase

The company sees a tremendous momentum in business. The clients who earlier had left are also coming back to the company.

The worry for the company is the increasing working capital requirements. As more and more business come in and as more business from larger clients comes in, the working capital cycle is getting more stretched.

Despite working capital issues, the company was able to repay Rs 16 crore of loan liabilities in 9 mths ended Dec 18.

Tax rate has come down as EU subsidiary pays 20% tax, US tax rate is 22.5% and in India the company pays 25% of tax.

Expects 18-20% growth going forward to continue.

The company has a little over 7 months of order book and is comfortably placed for a decent growth

Total debt of around Rs 150 crore.

No plans of QIP as of now, management will manage through internal accruals.

The pledged shares are not coming down as earlier told by the management to the investors, largely due to banks call posts the recent events in the banking sector.

Lot of traction in digital transaction is visible and more to come. The company is working on various Live projects and new technology, IOB solutions, Robotic solutions, proof of consents etc which will drive future growth.

80% of revenues come from US.

The company is continuously on look out for acquisition. Buys a company for customer base and capability rather than revenue of any target buyout.