C.E.Info Systems hosted a conference call on January 16, 2024. In the conference call the company was represented by Mr Rakesh Verma-Chairman and Managing Director, Mr Rohan Verma-CEO, Mr Anuj Jain –CFO and MrSourabhSomany-Company Secretary.

Key Takeaways of the call

Q3FY2024

In Q3FY2024, the company achieved all-time high in revenue. Revenue stood at Rs 92.0cr in Q3FY2024 up 36.0% YoY.

A&M (Automotive & Mobility Tech) growth was healthy at 19.5% YoY. Auto OEM volumes grew faster than industry growth. The company had multiple wins and go lives.

C&E(ConsumerTech&EnterpriseDigitalTransformation) business saw a sharp increase of 70.9% in Q3FY24 vs Q3FY23, based on nature of certain contracts.

The company has commenced add revenue monetization in Q3.

Revenue growth will sometimes be contributed from CME segment and some times from A&M segment.

EBITDA stood at Rs38.6 cr in Q3FY2024 as against Rs27.8cr up 38.0%. EBITDA margin increased to 42.0% in Q3FY2024 as against 41.0% in Q2FY2023. However as reported EBITDA margin is 39% in Q3FY2024. This is because the company had written of a provision to the tune of Rs 2.5 crore however, the company has sold the IOT product and the same is reported in other income. Otherwise the other income would have been Rs 8.22 crore instead of Rs 11.54 cr.

Map-led business EBITDA margin was strong at 54.6%. IoT-led business EBITDA margin continued to expand quarterly to 10% in Q3 FY2024, from 8.2% in Q2FY2024 versus 6.3% of Q1FY24, due to improved product mix and operational efficiency.

PBT increased from Rs35.7cr in Q3FY2023 to Rs 42.1crore in Q3FY2024 (Up 18.0%YoY) and PAT increased from Rs 29.7cr in Q3FY2023 to Rs 33.1 cr in Q3FY2024.

Cash balance stood at Rs 516cr as on December 31,2023in spite of dividend being paid.

9MFY2024

In 9MFY2024 revenues stood at Rs 272.5 cr up 30.0% YoY. Both Map-led &IoT-led recorded strong growth YTD YoY (9MFY24 vs 9MFY23) to Rs 201 cr vs 164.9 cr &Rs 71.5 cr vs Rs 44.1 cr respectively.

Overall IoT-led revenue has grown 62% YTD YoY, driven by healthy growth in devices.Share of subscription revenue to total revenue increased from 28% in 9MFY23 to 38% in 9MFY24.

EBITDA stood at Rs116.6cr as against Rs88.4cr in 9MFY2023. EBITDA margins improved to 43% in 9MFY2024 as against 42% in 9MFY2023.

Map-led EBITDA margins have expanded by 170 bps to 55.1% in 9MFY24 from 53.4% in 9MFY23 and EBITDA Margin of IOT business has grown to 8.2% from 0.9% in 9MFY23, due to higher gross margin subscription revenue growing 117% YoY.

PBT increased to Rs128.2 cr as against Rs104.9cr and PAT increased to Rs96.2 cr as against Rs79.2cr in 9MFY2023.

Revenue growth is happening and margin is expanding. The company’s strategy with IoT business along with map led business is yielding results.

Advertisement cost: The company incurred advertisement cost of Rs 5.4 cr in Q3FY2024. The same is incurred towards building brand awareness of Map my India, increase consumer usage and consumer awareness of Mapple app.

The company will spend on advertisement based on what is required in that particular quarter and is not pre-decided. It will also depend on the macro conditions.

QIP: The shareholders have approved to raise Rs 500 crore through QIP on Dec 29,2023. The company has one year time and the company will go ahead with the QIP when the time is appropriate.

The company will use the money  raised through  QIP  and the available cash to grow business both organically and inorganically  - through international diversification, growing consumer business and growing drone business.

Investments will be made to grow the business beyond 5 years.

Automotive: Electrical Vehicles require more features as such realizations are higher in EV segment. Every EV being launched is going with the company’s solution.

The company’s client retention is 100% in automotive segment.

International business: The company will follow the general approach of product first and consumer led business. It will sell what customer’s needs.

The company will add software solutions. With respect to enhancing global maps it will do if required.

Acquisition: The business of acquired companies Kogo and Indrones are small. It will take some time for them to grow and the company will leverage the solutions of the acquired companies once they grow.

Drone: The company expects to keep getting customers for the Drone business.

In the drone business, the company expects revenue from selling drones,  providing drone based services  and analytics and also providing overall drone solutions.

B2C:

Mappls Brand and App saw traction in Q3 with a strong ATL & BTL 360-degree marketing push, while remaining cost-efficient leading to much larger brand recall & app growth. The consumer business also started a monetization push through in-app advertising for a marquee brand. Mappls Gadgets traction and revenue continue to grow.

Outlook: The company is exited of the opportunities in Q4FY2024. The company has acquired lot of customers, funnel and order book is strong which provides confidence to the company.

The company plans to cross revenue mile stone of Rs 1000 cr by FY2027/FY2028 (4-5 years) growing at a CAGR of 35-40%. (This remains intact)

Mobility business revenue YTD is around Rs 70 cr which si around 25%. The company targets Rs 1000 cr overall revenue in next 4-5years as such mobility business will in similar in percentage terms.

Management commentary:

Commenting on the Q3FY24 and 9MFY24 results, RakeshVerma, Chairman & Managing Director, MapmyIndia, said “We’re happy that MapmyIndia crossed for the first time a milestone of  Rs 100 Cr+ quarterly Total Income, and again achieved all-time high in Revenue in Q3FY24, growing 36% YoY to Rs 92 Cr, while YTD Revenue has touched Rs 272.5 Cr. EBITDA in Q3FY24 grew 38% to Rs 38.6 Cr and YTD grew 32% to Rs 116.6 Cr, with overall YTD EBITDA margin at 43%. YTD Map-led EBITDA margin remains strong at 55.1%. IoT-led EBITDA margin has expanded to 10% in Q3FY24 versus 8.2% in Q2FY24, and in YTD stands at 8.2% expanding 730 bps YoY. YTD PAT is robust at Rs 96.2 Cr growing 21% YoY, with PAT margin at 32%. Q4FY24 will be exciting. Not just are we happy with the growth of our core B2B and B2B2C business, we are also pleased to see our consumer business take shape with increased brand awareness & product uptake.”

RohanVerma, CEO & Executive Director, MapmyIndia, said “We are excited about Q4FY24, with a strong order book build up based on very large new wins and look forward to sharing developments shortly. YTD (9MFY24) Revenue growth was broad-based, with A&M up 19.5%and C&E up 43.1% on the market side, while Map & Data was up 37.6% and Platform &IoT was up 26.5% on the product side. We had multiple wins and go-lives across our Auto OEM NCASE suite with an exciting funnel ahead. We also had multiple wins and go-lives across consumer tech companies & enterprises and in the government based on Map-led & IoT-led digital transformation. We started a strong 360-degree marketing push for our consumer business, which was highly effective, yet cost-efficient in increasing MapplsMapmyIndia brand awareness and product traction. We’re happy to see the start of ad-revenue monetization of our App & sales growth of our Gadgets.