Sir, thank you so much. Good afternoon, everyone.

I hope you all have the link to and you can see our presentation. I hope some of you at least have had a chance to read our shareholder letter which we published last night.

If not, I would recommend you have a look at the letter also in parallel to get a better flavor of what we're going to talk to you now. We're going to cover the last year.

We'll talk about some of the wins in this year and the shift in our business, and we'll talk in detail about capital allocation, and then we'll quickly move forward towards FY 2027 and FY 2030. Slide number three, to summarize, FY 2026 was a hard year.

Even though Q1 was in line with our plans, Q2 saw a sharp impact from four factors which converged around the same time. To detail them out, there was a significant impact in H1 on consumption linked to a very prolonged adverse climate cycle and geopolitical issues.

We think this had an impact of almost 25 crores on our revenue. The SBI cash outsourcing delay caught us off guard with a significant investment in routes and infrastructure.

This RFP closure, delayed from February to April to December, had a huge 100 crore revenue impact for us in the year. We learned, and we have made fixes in our operating processes post that.

The offsite ATM market contracted after AGS exited the sector, and many private and public sector banks were not able to find MSPs who were willing to deploy new ATMs on the transaction fee models. This has affected our ATM cash management business with revenue impact of almost 30 crores.

You total just these three items, the impact to our FY 2026 revenue was 150 crores on our services revenue base. Had this revenue come in, our rev growth for the year would have been 13% for services and 9% overall.

We also, if you remember, had mentioned this in Q2, we had to give out larger than usual wage hikes, which were linked to our long-term employee settlement cycles which are done every three to four years. Overall for FY 2026, our revenue grew to 2,487 crores, which is about a 3% growth, and our services revenue, which is our annuity revenue, that grew to 2,312 crores, almost a 6% growth rate.

On our part, we called for an analyst meeting as soon as things weren't looking good in September to avoid any surprises and to share with you as we saw the lay of the land changing. We took quick actions to fix and control what we could.

In September, we told you about what we're going to focus on to try and arrest this decline. We've always maintained that a good management team has to focus on balancing revenue growth, market share, and margin profile.

We focused the remainder of the year on protecting our revenue and trying to gain market share. End result is that our cash logistics business grew in market share by 200 bps, and in the managed services business, we moved from number five to number three position.

We have been always a big deployer of technology and leveraging it. We were able to accelerate that using AI, and we were able to drive significant cost efficiencies.

Our immediate focus was on our route network, and using ML, we were able to reduce our route network by a sharp 10% in the September '25 to March '26 part. Given the overall weakness in the MSP segment, we were able to drive a more sensible commercial model of fixed price contracts.

Historically, the industry has not been to get off the transaction fee model, and I feel, at this stage, for all practical purposes, the transaction fee model is dead in the ATM business. We, in fact, ourselves won a contract for 700 crores at a reasonably high transaction fee of ₹19 per transaction, but we still chose to stick to our principle of not doing any transaction fee business model deals, and we didn't want to take the risk.

Even though this could have meant a 75 crore annual revenue to start with at reasonable margins the first few years, we chose to preserve that 100 crores of capital for expansion and diversification into businesses which would have a more sustainable return metric. After years of strong growth in the prior years, we also examined our longer tail of lower-yielding customers and tried to drive price increases where possible, and in cases where we couldn't, we migrated some contracts where the prices did not make sense.

We also significantly tightened DSOs around our managed services business segment. Our OCF to EBITDA ratio in H2 was 173% compared to a -40% in H1.

We had told you that we will be making a big investment in technology, and even in a tough year, we continue to do that. In fact, we ramped up our tech investments to almost 40 crores of investment, which is 1.6% of our revenue, up from our usual 1% of revenue in the prior years.

We also made a significant investment in a gig delivery model of about 15 crores. We feel this is very critical to convert some part of our fixed-cost network into a variable cost structure and for expanding our retail business into tier-3, tier-4 markets in India.

The Q2 deterioration was arrested by Q3, and we sharply recovered in Q4. Q4 saw a 6% Q-on-Q services revenue growth.

In fact, if you notice, we have given you a 12-quarter trajectory. We have been sort of stuck in the 535 to 575 crore services revenue for eight quarters and have meaningfully broken out.

In February, we had mentioned that Q3 will be the bottom for us on margins, and we aimed to expand margins by 150 to 170 bps in Q4 and another similar expansion in FY 2027. I'm glad to report that we are able to sharply improve margins by 280 bps in Q4.

Overall Q4 services revenue is at 609 crores, 6% growth. The total revenue for Q4 is 633 crores at 2.4% growth.

EBITDA for Q4 at 162 crores, which is 15% Q-on-Q growth, but flat year-on-year. PAT for Q4 at 79 crores, 38% growth Q-on-Q, but a 19% dip Y-o-Y.

The full-year numbers on services revenue at 2,312 crores at 6% year-on-year growth and overall total revenue at 2,487 crores, 3% growth year-on-year. EBITDA for the year at 600 crores, -5%, and PAT of 303 crores, -20%.

The EBITDA and PAT numbers mentioned here include the wage code impact. Now, for historical purposes, we will show you the segment breakup.

However, we have guided you to the fact that segments no longer make sense anymore for us because this was our IPO when our business was mostly 70% cash management, 30% managed services. That split since then has moved to 60-40 and last year went to 55-45 split.

Given we are able to drive a lot of our business and growth to us integrated contracts where splitting a margin is not possible and feasible. On our overall EBIT margins in Q4 have gone from last year Q4 was 22.6%, they dipped to 15% in Q3, and have come back up to 19% in Q4 of this year.

For the full year, EBIT margins for FY 2026, they have contracted by 360 bps from 19.2% to 15.6%. Let me shift gears now.

After patiently waiting for the right opportunity and the right price and valuations for the last four years, we finally did two acquisitions in FY 2026. We have kept you periodically abreast of our M&A thinking, plans, and the sectors of focus.

We've intensely worked on 15 opportunities, letting some go after a lot of time, analysis, and investment of time. Either the sectors finally didn't make sense to us to take a risk on, or the valuations were way out of our comfort zone.

All of this experience has sharpened our approach how we quickly screen deals and the terms we operate on. The two deals in the year specifically: Securens is a key deal for us to scale in the vision AI segment and to grow this business.

The deal has closed and integrated and will be accretive to us in FY 2027. In Q4, we signed our deal with FSS for the managed services business.

This not only helps us consolidate the managed services segment, but more importantly for CMS, it allows us an entry into mid-sized private banks for cross-selling. It also helps us influence and shift those contracts from a transaction fee model historically to fixed fee models when those contracts expire.

We hope to close this and integrate this deal at the end of Q1. We have been able to drive this shift of transaction to fixed fee by showing the value of such contracts to the largest banks in India, and the rest of the market will follow in a matter of time.

I'm now on slide number nine. As we talked about M&A, I wanted to talk about capital allocation.

This is covered in significant detail in the shareholder letter we have published last night, and I would request you to go through that letter. To summarize, our IPO was an offer for sale, no capital raised.

Over these five years, the company has averaged a high 70% OCF to EBITDA and generated almost 2,275 crores of cash, out of which 1,000 crores have gone in for organic growth into capital investment. In fact, even if you look at the trends of capex investment, we have invested capital when we have been clear and convicted of the investment opportunity and the returns on it.

We went from an average of 200 crores of capex investment in FY 2022 and '23, and it dropped to 100 crores in FY 2024 and '25, as most of the contracts which were being bid were transaction price oriented and the prices were very low, and we stayed out of those businesses, which affects our FY 2025-FY 2026 growth, but we preserved capital for better times. In FY 2026, in the middle of the storm, we upped our capex spend significantly to drive higher growth in the coming years, and we have invested 350 crores of capex in FY 2026.

Dividends or broadly in terms of shareholder returns, I think have been linked to PAT and have grown each year till FY 2025. We have returned 438 crores through dividends to shareholders, including a special dividend we did in FY 2025.

To those of you who know us well, CMS is a self-funded compounder and not a grow-at-any-cost operator. Let me pause before I move to slide 10.

We are seeing a significant change in the business mix, which is critical to our transformation journey and to continue growing at our historical growth rates. This slide shows you a massive shift in the customer mix.

In our prior years, our growth was led by the managed services segment and SBI. Due to the transaction fee model being impacted in the country and that affecting the growth opportunity, we have been steadily and consciously diversifying our base to other large banks, especially in the private sector and retail segments.

You can see the sharp shift in the mix, which was 58-42 in FY 2025, end of FY 2026, this mix has shifted to 48-52. That's a very big shift in just one year and will hopefully accelerate in the coming years.

Slide number 11, at the Analyst Day, we introduced to you a new way of thinking about CMS, and we identified the three platforms we think will lead our growth to FY 2030: the ATM management solutions, the retail and currency logistics business, and the technology and payment solutions. These businesses were a 63-30-7 split in FY 2022, and in a four-year period, you can see this mix change again in these segments.

It's 58-26-16. The technology and payment solutions business has had a significant mix change from 7% to 16% of revenue.

In fact, it was 12% revenue last year itself. This is now a 370 crore business now for us.

What is driving this shift is Hawkeye, which is now 200 crore revenue and has doubled for us in the last two years. Through the Securens acquisitions, we have scaled this business significantly.

We today have 50,000 sites live, which have been actively monitored by a software. Think about this.

This is a phenomenal scale when you compare this to the fact that it took us 20 years to get to 70,000 ATMs, 20 years to get to 65,000 retail points, but 4 years to get to 50,000 RMS sites. This is targeting a large 8,000 crore TAM for us.

Within BFSI, which has been historically our strength, we have quickly moved to gain a market-leading pole market share of 36%. That is the power of this technology-oriented business.

We end FY 2026 with a solid order book, not only from size, which is 2,000 crores, but even if we say so, it's a high-quality wins. None of these deals is linked to any transaction-fee-linked contract.

All of them are fixed fee models. We are especially proud to have had a unique year.

We had three huge deals and wins from SBI, ICICI Bank, and HDFC Bank. These are marquee banks, and to have big contracts, long-term contracts signed for CMS in these years is huge for us and gives us a good tailwind as we move forward into the coming year.

In fact, these contracts help us secure 85% of the FY 2027 target and goal we have. We have these contracts in hand and going live.

End of '25 itself, we had set out our FY 2027 revenue goal. Despite the hit we took in FY 2026, we are still maintaining that revenue as our goal.

Our services revenue goal remains at 2,700 to 2,800 crores, which will mean a 17% to 21% growth on FY 2026 numbers. At an overall revenue goal, total revenue, we are targeting 2,800 to 2,900 crores, which would mean a 13% to 17% growth.

On margins, we have historically never guided to margins, and there are emerging pressures on possible impact to consumption linked to inflation or geopolitical impact, but we are still aiming to be in the 25% EBITDA margin range. Q4 has helped us significantly ramp up margin profile, and we will look to maintain and defend that in the rest of the year.

We've had a lot of feedback on this topic in the last nine months. It seems to be a favorite topic for many of our investors.

Our position on shareholder return has been very clear. We will do what is equitable and fair to all classes of shareholders, and in the prior years, it didn't make any sense given we weren't fully clear on our capital needs for growth.

Also, the taxation structure was unfavorable to many classes of shareholders. The taxation rules since then have changed.

We have done two deals. We have invested a significant 350 crores of capex last year, and we have weathered the FY 2026 storm, and we are well-positioned for the coming years.

With clarity on our capital needs and our cash balance of 650 crores, the board has approved a 168 crore buyback, roughly a 3% of our outstanding equity shares at a ₹340 price point. After this buyback, we will still retain sufficient liquidity for foreseeable growth needs.

As a team, we have meticulously focused on a higher TAM as a goal for us and to help us continue driving high growth rates. Our three platforms today target a TAM of 20,000 crores.

We are seeing a strong market consolidation and linked to that a repricing upside opportunity in the coming years. Over the last four years, we've grown our services revenue at a 12% CAGR.

This includes the slower years in FY 2025 and FY 2026. Over the next four years, we see our opportunity to accelerate this growth to a 13%-14% CAGR, which is more in line with our historical growth of 15% CAGR.

Thank you for your patience and your belief in a tough year, and with this, we end now and move on to Q&A.

Rajiv, hi. Good morning.

It's been a tough year overall. Hope '27 and beyond is better for you and the team, and thank you very much for your leadership letter.

A couple of questions. Like you alluded to in your opening comments, there was softness in private bank ATMs in H1 of last year.

How is that sentiment overall behaving today, and that especially in the context of what's happened in the last two months? They're all macro at a global level, but decision-making has come into things at a country level as well.

How are you reading decision-makings there? This question is from the perspective that our guidance of 2,900 crores, while is a very strong task, the exit that we have in Q4 pegs our revenues at roughly 2,500 crores, and of course the HDFC wins probably adds it to what takes that number to roughly 2,600 crores.

Which means we still need a line of sight to balance the incremental 300. How would you rate the quality of decision-making in this environment, and the probability of us getting to that larger goal?

Hi, Baidik. Anush here.

Let me answer some of your questions. Let me take the one on what is happening to the overall ATM industry, how are banks thinking about growth.

As Rajiv spoke and as we also shared earlier, we're sort of starting to see two or three trends. The first has been the shift in the mix of banks preferring to move from what we traditionally call ATMs, which are cash dispensers, into recyclers, which enable them to transfer a lot more of the transaction banking activities from a bank branch to an ATM site.

This can do cash acceptance, it can do video KYC, it can do card issuance. It's sort of similar to what a digital banking unit would have delivered.

We sort of start to see banks change that. The second is a change which has been pushed by primarily CMS of urging banks to switch from a transaction price model to a fixed fee model.

I think it's some of our earlier calls we had told you how the effective market clearing price for transaction fee has been constantly inching up higher. The last RFP that a single one bank did, this came at close to ₹25, which is anyways not a economical price for that bank given interchange is at 19.

In FY 2027, the 6,000 to 7,000 units that we see in different stages of bank RFP pipeline planning are mostly all either product purchase and with subsequent services outsourcing or will be a fixed price outsourcing deals. The second point on how are we thinking about our revenue shift, similar to our last call, our goal at that point in the end of Q3 call when we spoke to you in February was to exit FY 2026 on a strong revenue momentum so that we enter Q1 with about 650 crores of revenue.

Between 577 crores of Q3 to 650 crores for Q1, 609 is sort of a step in between there in Q4. A lot of the execution and order execution, as well as revenue ramp up of some of the new wins that we've had are underway.

The 650 should get us to a 2,600 crore run rate. It also means that through the year, we have to win and deploy about 100 crores of products, and the balance is things that need to be additional orders which need to be executed.

If I look at FY 2026, we won about 2,000 crores of overall orders, of which we have close to about 400 to 500 crores of work which is still to be executed. Got it.

On the margin front, I understand the fuel inflation is something that has just happened. In our typical pricing, how does pass-through work on our ATM milk runs?

Is this something that we can pass on overnight, or do we have to absorb this blow if this gets escalated?

I think there is a rhythm and a routine to how we've done this over the last decade, decade and a half. We've sort of been as a company and a team been through various inflationary cycles, benign ones and more difficult ones.

Different playbooks, different tools. Simply put, there are some of our contracts which offer a CPI, WPI-linked inflation increase.

Our effort is to constantly have more contracts move into a regime like that. For the ones which don't, we do have periodic price resets.

Effectively, I think the way I would look at it is as we move from '26 to '27, we've also shared in our analyst meet in September when we've met that we are trying to get price increases across a lot of our contracts. The normal inflation-linked increases get set off with price increases which are part of these efforts on an annual basis.

In case there is some things which are more extraordinary or things that we can't plan for, it may be certain states which have undergone a much steeper minimum wage increase or fuel price increases which are beyond normal, those are times where we try to push or pass on a price increase which is outside these annual cycles. I think the industry gets together at these moments to discuss with the key clients.

Again, it's really client relationships and the value you drive. I don't think it's directly linked to headline inflation.

I think either it's linked to your contractual terms or negotiations which are logically based in what the ground reality is. The private sector engagements, it is far different than it will be the public sector.

No, no, I understand. Mine was a very topical question given what happened yesterday on the price hikes.

The simple point being that does it represent a risk to our 25% margin aspiration? That's the only thing I'm trying to drive at.

Are we

No. No, no, sorry.

I think it's a fair question, Baidik. You've known us for some time, we are very reticent on margin forecast because not always easy to control what the competitors will do and the market will be.

I think we've had a good Q4. We don't want to get carried away with extrapolating that straightaway into next year.

I think we will want to wait and see what happens in Q1. Right now, there is just unknown volatility given we all feel in India that a lot of the price impact on fuel may have been deferred for whatever consideration.

Let's see this play out. We've seen one price hike yesterday.

I don't know what more will come in. We don't know what'll happen to work from home as a concept right now.

I think we'll wait for Q1 to see how things pan out. Our effort, given the investments we have made and the nature of our contracts, some of the M&A we have done, is to get to a 25% zip code.

Sitting in May, impossible to tell you today if we will hit it, achieve it, or miss it. I don't think there is significant risk as of today, but we would prefer to be conservative on this.

If we are able to drive the revenue growth, I think gives us a better margin. Like last year, we talked about in the Q2 or Q3 call, we did wean away some of our lower-yield retail customers.

That's revenue gone, but also lower-margin business gone. If we have to sort of wean away some business at the end of the year, if we drop 25, 30, 40 crore of revenue to maintain a higher margin profile, we'll look at that in H2.

Sure. Just a quick question before I get back.

There seems to be a ramp-up in your depreciation costs. I understand the acquisitions have not yet been closed, the FSS one.

I'm just curious, what's driving this sequential ramp-up from 46 to 59 crores with depreciation?

Depreciation ramp-up, you said? Pankaj can answer.

Sorry. Depreciation, there is some change here.

During the year, we have done around ₹350 crore of the capex. As well as the Securens, we have already added.

Related to that, the depreciation is increased from ₹54 to ₹59 crore.

All right, got it. Just the last question on the FSS acquisition.

Is that expected to be earnings accretive from the first year itself, or we wait before it turns accretive?

Let's finish the deal in Q1, Baidik, and after that, we can tell you better.

Sure, Rajiv. Best wishes.

Yes. Hi.

Am I audible?

Hi, Rajiv and team. Thanks for the opportunity.

The investor letter read in a very heartfelt and frank manner. Thanks for writing that.

Had a couple of questions. One was if I look at your FY 2027 revenue guidance, if I were to do something like a pre-mortem on that, assuming, let's say, one year down the line, for some reason, that's not achieved, what are the top two or three reasons that happening?

That is my first question.

It's a great question. Can you tell us the second while we think of the answer to that?

Sure. Second question was on the kind of transaction-linked kind of project that you walked away from, which happened in the later part of '25, right?

I just wanted to understand did any of your competitors take up that? Because you have been hinting that industry is moving more and more towards the fixed-price kind of model.

Was just wondering, given that size of contract, was it taken up by someone? If so, how do you look at that?

Yeah.

Where we are right now on revenue, and I think Baidik also referred to that, the 633 crores you extrapolate that right now just out of simplicity into four, that gets you to 2,500 crores. We're executing and going live on the HDFC contract, which should get us another 50, 75 crores of revenue in the year.

That gets you closer to the 2,600 crore number. Now we're talking about another 200 crores to hit.

I'm talking about the bottom end of the range. Let's forget the higher end of the range right now.

200 crores, I think there are orders and order wins which could help us contribute to that delta. What could go wrong?

What could go wrong on the revenue side right now would be if there is a sharp dip in consumption in let's say Q1, right, because Q1 is then into a four issue. There could be risk to consumption both at the retail side or at the transaction-per-ATM level.

We have seen in March and April a dip in currency supply in the country, which impacts ATM transactions. I think if that trend continues, let's assume for the next 10, 12 months, there could be a 50, 70 crore impact on the revenue.

Unlike last year, last year forecast was based also on a 100 crores of revenue we were presuming would accrue to us from the SBI contract, which didn't happen. We don't have that risk right now.

We don't have any such large risk which is sort of assumed to happen and will not and therefore could sort of dip. Whatever is in the math is a contract either going live or already signed.

There is a delta from 2,600 to 2,800 crores, absolutely. I think in the rest of the year, we need to go work hard to earn it.

That's the answer to your first question. Your second question was, did somebody else take the contract?

Yes. Should we name it?

No. Will those ATMs go live?

Hopefully. Will we get some part of the business from there?

We should. Again, it's really at ₹19, I think is a great price because that's the max you can really get at interchange today.

For us, it was really about could we foresee us making money over a seven-year cycle on the contract? We couldn't.

We could, but not at the levels, at the threshold, and the return metrics we have. I've said this historically also to some of you is that growing our business is not a challenge.

There is business. Growing this business at a 25% zip code on EBITDA margins, the ROCE levels is a challenge, and therefore, for us to keep aspiring to grow double digits maintaining that return profile is something we have created as a ring fence around ourselves, and we have to keep maintaining that high threshold.

I do think there will be some players who can make reasonable returns on that project. There is a little more risk.

We prefer to take that 100 crores and deploy it when we find a segment or a company where we like the return ratios more in favor to what we prefer.

Thank you. Thanks for the response.

Hi, sir. Good afternoon.

Thank you for the letter and the way you communicate every time. I had two questions.

First question was in the analyst meet last year, you had broken down the cash logistics business into ATM cash, retail cash, and CIT. Can you give that number for FY 2026?

Yes, yes. I'll do that.

Sir, we see that offsite ATMs are reducing by private sector banks, and we also see number of transactions as per RBI data coming down. In this context, why would banks want to increase offsite ATMs?

That was first part. Second is that between offsite and onsite ATMs, do our services change?

If yes, which is more profitable?

Hi, Umang. Let me answer the second one first.

Very good question. It's a trend that we had called out earlier that we are seeing a shift between the behavior of onsite and offsite ATMs.

Like I said, I think banks at the point have changed reasons for why they need a certain network and scale. If you'd asked me this question five years back or even 10 years back, both private and public sector banks expanded ATM growth rapidly, mostly on the back of independent ATM deployers, or what we call the BLA model, executing this on a transaction basis simply because there was a significant arbitrage to be earned between interchange fee, which is what one bank settled with the other, versus the cost of running an ATM network.

It made sense for banks to invest and create net ATM capacity, which was probably running ahead of what they truly needed in terms of their debit card issuance and spread in terms of savings account. Five years back, we started seeing some banks, specifically the private sector banks, changing and taking a pause, saying this is not about having the biggest or the largest network.

It's also about using the network for the right reasons, which is driving penetration and growth in newer areas that they're entering into. If you set up a branch, they typically wanted the branch to be surrounded by one or two ATMs.

It helped in building CASA. It also helped in branding and distribution.

Right now, if you sort of see what banks are doing, they're treating the ATM channel as a way to effectively act as an alternate servicing mechanism to their bank branch. It's not just about cash distribution or cash withdrawals anymore.

It's also about trying to cater to the customer lifecycle and the needs. Some of the work that we're doing, and let me take ICICI Bank as an example, two years back, they had, I think, about 20% cash recyclers and 80% cash dispensers.

In two years since now, since we've been working with them, it's gone the other way. We are 80% cash recyclers and 20% dispensers.

Now, to most of us, we still call an ATM an ATM, but fundamentally, from the views of a banker, a cash recycler provides service to a whole set of customers who are otherwise walking into a bank branch to deposit that cash. These could be SME customers, these could be traders, these could be retail accounts, but all of this then moves into a cash recycler.

Second, as we are going live with the Algo NBS software this year, that allows a bank to upsell a lot of the value-added services or a lot of the non-financial banking services and package that into a cash recycler. This could be account opening, it could be video KYC, it could be cross-selling a loan which is specific to you as an individual, not just a traditional loan product.

It could be InstaCard issuance. It could be passbook updation in the context of public sector banks.

I think we are seeing the cycle shift. Banks are willing to commit their own capex as opposed to getting private parties to put up capex here.

On the back of this capex, they're looking at transferring a lot of the expensive transaction banking activities from a branch to an alternate channel model. I'll just go back to your earlier question on the split.

I think if you look at it, we also said we will resegment our revenues into the three platforms. All of ATM cash goes into ATM solutions, we have retail and CIT combined, and we have technology and payment services.

The specific mix of those splits are captured in our presentation. I think the cash MS split, we said it's the 60-40 historically.

It's gone to 55-45. Beyond that, I don't think we even have the live numbers.

We are starting to internally just focus on the three platforms and measure them. That split is already mentioned, and I think you talked about the transactions and the stability.

Cool. Sure.

Thanks, sir.

Hi. I have a let's say three questions for FSS business.

The first one being that whatever revenue that FSS was doing, some would be through CMS and some will be through other players. How are we thinking of moving all of that business to CMS, or will the contracts expire and then only CMS will take up those business revenue opportunities?

The second one is more a basic question and then a build-up on that. The fixed fee versus, let's say, transaction, does it get fixed at FSS level?

If yes, then is there a certain percentage of revenue that FSS is currently doing on transaction basis which that ways leads us to some bit of exposure to that kind of revenue stream? The third one is that while we mentioned that there is a cross-sell opportunity of Hawkeye and Algo NBS, do the current client base do not have that offering, and therefore, it's more of a let's say be doing an inception sale to them that these are the advantages, or it's a replacement of existing vendors, and therefore, again, how do we see that timeline moving to CMS?

Hi, Divyansh. Anush here.

Let me go one by one. As far as the first question is concerned, the contracts that we are transferring from FSS would be all the managed services contracts.

Now, for FSS, we are already one amongst their largest cash management partners. I think when we talk about incremental revenues, it's mostly the parts that were not attributed to us in terms of overall managed services for these ATMs and possibly for some ATMs that we are outsourcing to others.

Right now, in terms of when we have sort of done our internal math, in terms of the focus is really more on getting the customer innovations done, bringing back the quality, and stabilizing those networks for the banks. We're not really right now thinking too much in terms of arbitrage of what we do versus what other people do.

I think fixing the quality and stabilizing the network is our focus right now for Q1 and Q2. To your second part, yes, there would be some contracts of this which would have a transaction exposure.

However, again, the reason that we are differentiating this from what we typically bid for is in contracts like this which have already had two, three, four years of transaction history and aging, it's a lot easier to understand how those ATMs are performing and to take certain calls on what needs to be continue running, what investments you need to make to either fix and improve the sites or what ATMs need to be shut down. It's a entirely different call from a capital allocation perspective of bidding for a new contract, going in hunting and chasing and setting up those sites, and then waiting for the transactions to come.

I do want to add here a couple of points here, Divyansh. One is, FSS, and if you're aware of the company, has run a very good quality managed services business for the last decade.

It's a respected name both in the technology side and what they've done for banks, and they have historically done very well. For their own portfolio needs, it's a business they were looking to maybe exit for some time.

We as a company have analyzed maybe five managed service providers from acquisitions at different points or stages of time. In our mind, the FSS business is the highest quality business out there in this sector, the client relationships and the profile of the work they do.

Their transaction-linked business, which is there, and I think a very good question, has thankfully been contracted mostly to what I would say a high-quality base at reasonable price points. There may have been some impact in the last one year to that base of business basis given how overall transactions have occurred, and that reflects in the deal value and the pricing which we have negotiated.

We also have a trendline on when these contracts can end and what we can upsell and how we can convert them. To your question on cross-selling with Hawkeye, primarily let's say Hawkeye and Algo, Algo would be new opportunity, right?

It would be new opportunity for us if we're able to crack one or two deals. I think it will be totally accretive.

The Hawkeye business, I again think that some of the mid-sized banks haven't really deployed aggressively, or they are doing it, I would say, that with a smaller quality or a lower-quality vendor and not across their whole base. Consolidating this also, as we said, CMS was a number five MSP.

Before even FSS acquisition, we became a number three. Post that, I don't know what happens to the stack rank there.

Also helps us consolidate and deliver some synergy and cost savings automatically, right? Because a team which is going to be handling a larger base of ATMs both at a managed service level itself helps us drive synergy out there.

Got it. The second question was the revenue ramp-up that you mentioned, right?

Let's say 625 into 4, 2,500, HDFC around 50 to 60, and just looking from a lower guidance perspective, what would be the ramp-up of the SBI and ICICI contract? Rather on a general basis, if we win a 7-year or 5-year deal, how should we think the revenue ramp-up happening across years?

I think the Excel modeling, I'll leave it to you. I think we have given what information we should share about some of these customers and contracts.

I think the SBI contract is over a period of 7 to 10 years. The ICICI, HDFC ones, Anush can correct me, is about 4, 5 years roughly.

ICICI is longer.

ICICI is longer. HDFC is how many years?

Five years. Five years.

All of that revenue is not going to be exactly divided by five in the first year. Obviously, some of it is linked to either a pricing change or to a base increase.

For sake of simplicity, divide it by the number of years and just assume that'll flow through for the first year itself.

Got it.

Also, the bases don't remain static, right? Bases change, right?

There is churn always. Something gets shut down, something is added.

I would love to say this is very conservative, but we wouldn't know, right, of how the base of the machines changes with some of these banks over a period of time. This is basis what we have right now.

Got it. If I may ask another question?

rejoin the queue, please? Thank you so much.

We will take our next question from Govindarajan Chellappa of CSIM. Govindarajan, please unmute your microphone.

Yes, please. Go ahead.

Hi. Thanks for taking my questions.

I have a couple of them. One, there seems to be M&A activity across the globe in this space again.

First question is especially on NCR and Brink's merger. Would you see any opportunity or threat?

Do we run a Hitachi kind of risk here? I know Brink's is very small, but just your thoughts on that.

Govind, the second question?

My second question is, see, you still have a reasonable exposure to 28%, I think, is what you mentioned to MSPs, and that space, at least the smaller ones, have struggled to find funding. Of that 28%, are there still any of the MSP customers of yours who you would classify as at risk in terms of their own balance sheet, their own ability to get funding, their ability to pay you up?

A related question is in your balance sheet, I see about 58 crores of loans and advances, I'm guessing that is to a client. If you could just talk about the thought process around that.

On NCR and Brink's acquisition, we'll see how this pans out. I'm sure they'll get regulatory approval to do this around the world.

I don't think we are sort of looking at this and saying they are too small or too big. I fundamentally feel the network and density we have in India is impossible to replicate.

It's something I mentioned towards the end of my letter also, saying you cannot replicate what CMS has in terms of network reach and density. Can that mean that, at some point of time, NCR and an MSP customer can shift some base to Brink's, and Brink's invests to grow?

Absolutely. I think we have time to ramp up, and therefore, I don't think our diversification are linked to that, but I think our expansion business will make sure that we have enough growth to compensate for some of these trends which if it happens.

Is there any opportunity? I don't think so.

There's no opportunity, right? Is there a risk?

We presume there'll be risk. Will that finally pan out or not?

God only knows. I do think this is a more complex global merger.

If I was sitting at Brink's in the US, my priority would be to focus on the top five markets, which for them is US, Canada, and large geographies in Latin America. These are complex deals where global teams have to align and merge, and therefore, far away in other countries, let's see what the impact is and when it comes in.

Brink's, for those of you who are aware or not aware, in India is predominantly a player focused on the bullion space, and global bullion, they are the largest company and huge and do a great job on that. They have some network presence in India, but linked to basically I think the larger tier cities.

In the cash management space, they are a very small player. I think if they had to scale in India, this would need significant investments across the country to invest in infrastructure, vans, routes, and all to, and let's see what that happens.

We'll know when we know on this. Your second question was on

The MSPs.

On MSPs base. I think that 28% of so as we finish FY 2027, or as we get into FY 2027, let's see where the base of revenue from the managed service customers comes into.

You're right, that sector is going to be, as I said, the prior growth was led by some of these customer segments. The next four, five years growth will not be led by these segments.

Therefore, for us to model, we are modeling it's a lesser growth from these segments. The slack will be picked up by our expansion into the new platforms we talked about and some of the newer customers, especially the larger private sector banks we talked about.

Your third question was linked to a loan. Advances and loans, Pankaj or Anush, if you can

just I'll just quickly cover this, Govind. If you recollect about four or six months back in I think in our third quarterly call, we spoke about some of the mid-sized MSPs being under liquidity stress and us going about solving for this in different ways.

As we speak, and we had also said that by end of FY 2026, we hope to sort of have these addressed. As we speak, with one of them, we've entirely solved for it.

The DSOs have come down. We have much lesser exposure.

With a second one, we've made this announcement in FSS, wherein post the acquisition will be a combination of our receivables from them plus a cash consideration. In the case of a third MSP customer, we've converted what was our exposure into a secured outstanding, which is backed both by physical assets with a significantly higher cover, but also more importantly, getting access to receivables directly from the bank into an escrow facility, which covers both the loan amount as well as the normal work that we render for them.

Okay. Basically you've converted unsecured receivables to secured loans.

That's the right way of thinking about it?

Yes, unsecured to secured, plus getting the collections from their banking customer directly into an escrow account. Yeah.

Okay. Just one small clarification.

My question on the exposure to MSPs was not in terms of growth opportunity, but in terms of risk of further receivables issue. Of the 28%, do you see any of your customers having any issues on balance sheet?

No, Govind. I think we took a provision last year already in Q2.

I think the activities we've done both which Anush detailed about should cover us from any potential risk in this area.

Cool. Thank you.

Thank you so much.

Hi. Am I audible now?

Hi. I'm Akshat from Multi-Act.

I had two questions. The first one is on the margins, right?

While we've guided on EBITDA margins reverting back to 25% plus for FY 2027 and also for the longer term, but if you really look at the cost structure below EBITDA, right, our depreciation over last three years has jumped from almost 132 crores to 210 crores approximately for FY 2026. As a percentage of revenue also, it's inched by about 1.5% to 2 percentage points.

In terms of EBIT margins, what is the thought process and because these investments, when do they yield results in terms of better EBITDA margins, etc.? That is one.

Second is on the buyback. What would be the participation from Mr.

Kaul on this buyback, and what is his view on whether they will be participating in tendering their shareholding? Those were my two questions.

Akshat, I think let me tackle the first one, which is so I think when you look at FY 2026 in context, you should also look at it in terms of how our overall this construct or the structure of our business is changing. We are switching from being a 70% cash business to investing into longer-term growth potential, especially around our technology businesses.

Those will necessitate more upfront investment, but will yield results and more recurring revenue streams on a 5 to 7, 8-year time period. The context of capex investment and depreciation would mostly be linked to some of our longer-term investments.

You should also see in the light that, in FY 2026, we did get headwinds in the form of consumption weakness, slowdown, and transaction impact, especially for some of our both the ATM as well as retail business. In a way, sort of the margin and the structures are weathering both of these ups and downs.

As we think about FY 2027, there will always be a sort of a lead and lag effect from an EBITDA and a PBT or a PAT perspective. When you look at Securens or when we look at FSS, I think we would normally want to assume that it would take a few quarters for the synergy benefits to kick in, whereas the depreciation gets recognized from day one.

We do hope that over a period, things should get better.

Also, Darshan, I think in the last couple of years, Pankaj has alluded to in his comments that the right way to think about this is ROCEs. ROCEs, apart from this year, have been fairly strong in the 25% range, and I think we focus on that.

To your second question on participation in buyback, specifically you called me out, but I don't intend to participate in the buyback at all.

Great. Thank you.

Thank you for your clarification on both these questions. Really helpful, and all the best for the year ahead.

Thank you.

Hi, sir. Congrats on a good Q4 margin recovery, and top three banks in our bag.

First question, sir, how do you see the pipeline this year since these three large contracts has already done? How do you see the other contracts you did mention in the presentation that we are looking at some 6,000 to 8,000 ATM looking for moving from fixed fee to fixed fee pricing model?

Just in general, how's the pipeline visa-a-vis, say, last year? Is it looking similar, better, or maybe a little lower because of the three large contracts that we already had?

In that context, maybe you can cover the FSS acquisition. You did mention we have a lot of mid-cap banks, for want of a better word, in our kitty.

How are we planning to cross-sell overall things? Maybe pipeline in the context of those new clients, bank clients that we've had.

Amish, hi. Very valid points, Amish.

I'll just start off by saying, despite all the headwinds and the challenges that we had in FY 2026, I think 2,000 crores order wins has been amongst the best years that we've had. We've executed, I think, as I said earlier, close to about 75% of this.

There is still 25% of work to be done in terms of this execution. We enter FY 2027 with I suspect Q1, Q2, H1 really sort of being a fairly intense year from an execution perspective, both of some of these orders to be rolled out, the integration of FSS, and just generally looking at how the macro setup is.

We do see in FY 2027 banks coming back into the refresh cycle. They'd taken a pause in FY 2026.

We see them coming back into this. However, I think it is a little early for us to comment on how exactly this will work out simply because, given how the overall situation is, we do have some RFPs which are in different stages of the pipeline, but I think we would wait maybe at the end of our Q1 or Q2 call to comment about how exactly this is panning out.

Got it. On margins, we had a fairly good margin bump-up in Q4 over Q3, though Y-o-Y looks pretty flat.

The question is, sir, if you can explain the nuances of the margin maybe within cash versus the other business? At an EBITDA level, there's a huge swing in the cash business.

The question is, where does this come from? If you can give us some flavor of the improvement that has come versus volume versus price increase that we've had because of the low pricing that we had in the past?

The question is from 25%, we do understand that aspiration is to maintain, but how much is due to, say, a better pricing versus operating leverage? We understand the fuel price hike is a big overhang.

How have we improved it, and what are the levers that we are using to kind of make it stable and maybe improve it from here?

Amish, I'll just quickly jump in. We, if you go through our past calls, we really don't get into this level of detail on margins.

I think for us, given FY 2026 was a significant dip, we sort of went out on a limb to say we will push back our margin profile. You're right.

A significant part of the, as revenue starts climbing back up, you get the operating leverage, and the work which Punit and his team have done on rationalizing our routes, Anush and his team have done in trying to get pricing hikes and the new fixed-price contracts, I think they're all starts contributing back to the margin profile. Your question would be I also think would be linked to how much of this is sustainable in the future.

Don't know. I think we have a good base.

Q1 historically, not historically, seasonality-wise is a lower-margin profile basis wage hikes and increments and whatever happens. We'll wait to see how Q1 goes through.

We will also finish all our contracts. We're then We're almost done all our contract execution.

The new one, HDFC, will go live this quarter, and we will have a sense better sense of the year. On the margin side, I think cash and managed services, I told you they are fungible, really.

It's very difficult to sort of for us to even call out how much is where. Overall fuel cost and vehicle cost is a percentage of our business is roughly about 6% of our overall revenue.

If that goes up by X percentage, you can start doing some calculations on that. We have built a pretty tight operating network.

I also do want to caution here saying, as we roll out new contracts and new businesses, there will be expansion and investment back into a route network and all. You can't exactly time it to quarter-by-quarter, but hopefully we should be able to maintain those sort of margin profiles.

Sure. Thanks, and all the best.

A great letter to the shareholders. Thanks.

No, I really don't have anything more to say. I think we've given out this time a fairly detailed letter, which normally would have come in the annual report.

We thought it's a good trend to get it more circulated widely at the end of the year for every investor to read that specifies and details out exactly the way we are thinking so that you are able to both get a better sense of the business, what we're doing, which can't be covered in a presentation accurately, and also hold us accountable for it. We are still maintaining our North Star goal of FY 2027 and FY 2030 despite having a reset in FY 2026.

Not easy, but we feel quite confident that we have done a superb hard work in the last six, eight months to fix things which were breaking down and the things which were under control. Wish us all the best, and thank you for your belief and patience in a tough year.

Talk to you at the end of Q1.