Thank you for joining us today to discuss Intellect Design Arena Limited financial results for the fourth quarter of the fiscal year 2025-26 and also for the full year FY26 ending 31st March 2026. An investor presentation and press release has been sent to you and is also available on our website.

Our leadership team is present on this call to discuss the results. We have with us today Mr.

Arun Jain, Chairman and Managing Director; Mr. Manish Maakan, Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking; Mr.

Rajesh Saxena; Mr. Banesh Prabhu; Miss Vasudha Subramaniam; and Mr.

Vikas Mishra. Besides, some other senior members of the management team are present on the call.

Now I hand it over to Mr. Arun Jain for the management commentary on the results.

The commentary by the management team will be followed by Q&A, where your questions would be replied by the management team. Once the Q&A starts, you can ask a question by clicking on the raise hand, and we will unmute you so that everyone is able to listen you.

On safe harbor, I would like to remind you that anything which we say which refers to our outlook is a forward-looking statement, which should be read in conjunction with the risks that company faces. With this, I hand it over to Mr.

Arun Jain. Arun?

Good evening, everyone. Thank you, investors, for trusting the company over the last 10 years of this journey.

We embarked on this journey in 2015, we're completing 10 years clear, 10 years' time in 2026. 2016 was the first result of full product company in Intellect, and this is the 10th year of this journey.

I must thank each one of you that you trusted the company over this 10 years' period. The many of the investors who are still with the company for 10 years, some of them joined the journey in '17, '18, and they've seen the vagaries of building a product companies.

Any product company in the world which is having a license-linked revenue, which has a long-lasting value over the next 20, 30 years because of the technology licenses, takes this kind of a ups and downs, where when you build the technology, deploy in the market, and then you have some time to accept the technology by the customer and then getting into the next technology. Now, in this process, what we adopted in this journey was using design thinking as a core value to understand what is the customer desirability, feasibility, and viability, which I mentioned to you earlier.

We added during this journey, when we found that design thinking is not complete, there may be possibility of adding first principle thinking, by which we are able to reduce the wastage during the technology architectures. Then we applied framework thinking, and fourth, we added system thinking.

There are four cognitive engineering technologies we use for building the entire product engineering landscape. I know as a investor you are interested more in financial numbers than philosophical number, but I'm sharing with you these things because as a product company and coming from India, you need to have all the four kind of a cognitive thinking translating into a impact-driven products.

This impact-driven products what we are talking about is, first, understanding the technology landscape, when it is changing, what point of time we need to invest in a new technology. When cloud was coming in 2014, we invested cloud in time.

When AI was coming up in 2017-18, we invested before time in 2016 in US and UK. We invested in AI in 2016, way back 10 years back when we invested AI.

This was based not on what revenue we got in 2016, '17, '18, '19. For first 5 years, we hardly got any revenue from the AI business, for which we invested heavy money and lot of questions were there.

That prepared us for seeing what you can do with AI, what you can't do with AI. That has helped in choosing the right strategy going forward when the generative AI hit the market.

We were ready for generative AI to take the lead, and then we created a platform which we launched last year. Last year in June, we launched Purple Fabric as a platform, which is competing with the Palantir on functionality and the process.

Especially for financial domain, it is very, very appropriate for the financial domain. If you just go back to 3 years' history of eMACH.ai, we launched eMACH.ai in 2024—'23, February '23 we launched in Mumbai along with AWS on a cloud, this platform where we put all our microservices.

That time it was 300-plus microservices; now it is 700 microservices are there on eMACH.ai cloud. Then we look at our strategy to be divided into six blocks.

Every 6 months, we don't look at quarter; we look at 6 months. We call strategic planning cycle: SP1, SP2, SP3, SP4, SP5, SP6.

Means we have completed SP6 cycle since we launched eMACH.ai as a platform. In cycle SP1, we understood that eMACH will be more acceptable in advanced market because they understand the value of the architecture, that how architecture can drive their cost of ownership of the technology.

That is the time when we were not entering to the US, and we mentioned to you that we entered into US, Canada, Europe. Those investment we did, we got some early wins like OTP win we got in that cycle, and many other banks, we got CIBC deal and other deals in that cycle.

Now this time, we are now six cycles are completed. This is the time when we are evaluating ourselves against six cycles and planning for next six cycles.

There are 12 cycles when we looked at it when transformation is there for 3 years and next 3 years. Next 3 years will be monetization phase.

First 3 years was creating the entire infrastructure of my products, which are coming together on eMACH platform, my narrative, my go-to-market strategies by aggregating my six marketing under Chief Revenue Officer. This is a time when we try to consolidate the power of LOB to power of Intellect.

That's where it took us some time to see that value each product is bringing, each line of business is bringing, so that it becomes a multiplier impact when they come together. In this process, we could able to sign up the marquee customers.

Almost we have 60 customers who has asset size is more than $100 billion. They are our customers where we have a great opportunity to cross-sell on eMACH.ai.

That's the reason which I'm saying why we are bullish about future is if they are sitting on the same eMACH platform where we are promising there is a one source of truth of data, it is much easier to sell second product and third product on a common backbone. Like Salesforce, if you sell the same product, the backbone remains common.

That's how eMACH cloud, what we're looking at, it will be relevant for it. This is a part one of our exercise, where we'll be going deeper into large accounts.

Now, second piece which is coming out by connecting Purple Fabric and the product, which is called eMACH.ai. Now, in last 18 months, we made all our products AI-first products: AI Core Banking, AI digital engagement platform, AI Lending, AI Trade Finance.

Since AI is properly built with AI-first thinking process, we are able to drive higher number of sales, higher number of pipeline. Because it's a AI-first product, we could able to compete or overshadowed our long customers in trade finance business, in lending business, which was initially, when we are selling only eMACH as a trade, was not becoming the or eMACH as a wealth.

When these two technology come together, that's created a kind of a moat against our key competitor in that space. We are in a final stages of few large wins in this space of eMACH.ai.

First I covered products, then I covered eMACH plus AI, and then finally, I'll cover role of AI and how the AI is evolving the world and where are we in the journey of AI. I'll take separate time sometime later on explaining what the AI is all about and where we are looking at it, but in a nutshell, for this investors' conference, I would like to say that on one side, you are hearing lot of noise of the Anthropic, Claude, ChatGPT, OpenAI, and the coding, the Cursor, and the jobs is going to replace in AI world.

All the things which you are hearing as a investor are all true. It's not that these jobs will not go away.

Jobs will go away from IT world, and India will be in some trouble India will face with a AI implosion. It's a completely new change.

On the other side, many banks, many financial institution which they implemented AI for customer services, peripheral areas, they are getting the benefit of implementing customer service area where 80% to 85% accuracy is allowed because they are doing support services or customer service area. That's the area where AI is giving benefit to the financial institution.

Most of the financial institutions have not able to apply AI or productionize AI in core processes or core systems and core technologies. For that, our research teams have done a phenomenal job in this space.

They understood the core issue why AI in enterprise space will not work unless we solve the core systemic issue there. Intellect research team has done a deep research on it.

They applied some mathematical model, some model from physics, some model from mathematics. Using those models, we think how to create a deterministic knowledge, which is a core of any judgment or decision AI can take.

For financial institution, for core processes, we need at least 95% as a minimum benchmark for making it usable for production-grade AI. I call it production-grade AI or enterprise AI.

We exactly solved that issue because intelligence accuracy is equal to knowledge accuracy into reasoning accuracy into context accuracy. If knowledge accuracy is 85% right, which LLM gives me, reasoning accuracy, which I create by agent, is 95% right, if context accuracy is 95% right—these are best cases I'm just telling.

You can't get more than 95% right in context or 95% right is reasoning by AI and 85% in knowledge. Now you multiply them, not take a average.

Take your computer or take your cellphones and multiply: 85 into 95 into 95. You will get 76.7% accuracy.

Now 76.7% accuracy, it cannot be enterprise AI for core processes of the financial institution, and that's the problem most of the banks are facing. This problem, we have filed some 15 patents in this space in last 6 months, where unique to Intellect, where we solved this problem by applying physics, mathematics, and models embedded into my knowledge models and embedded into my data models and entire technology models.

There, we are now able to achieve, in many spaces, close to 94%, 95% accuracy in the application. We are able to govern it well.

We have signed two large enterprise deals in AI platform deals in India and three or four, almost three deals outside India on platforms. Their pipeline is growing well.

This is a one part of the platform which I mentioned to you. Second way of going to market is each product is going like PF Trade, Purple Fabric Trade business, Purple Fabric Lending business, Purple Fabric Wealth business, Purple Fabric Risk and Governance business, Purple Fabric Customer Onboarding.

All the pieces are being sold where the banks are ready for only applying use-case basis or bank wants to make a change together. These are the two streams of revenue we are building in AI space, and both are looking very, very lucrative.

Manish will tell you all the details of how the year went by, what businesses are done, where we have done the various revenues. If you have more questions in AI, if you feel that it will be of interest to you, sometime in next 2 weeks, I'll take a 1-hour session, where you can send the questions to us that what question you want to know, especially for investor, where we can have some 90-minute session for all the investors to understand what the AI space is evolving and what is my personal understanding of AI is.

At this point of time, I hand it over to Manish to take you through the results. Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

No, thank you, Arun, and good evening, everyone, and thank you for joining us. Like Arun called out, it's been a systematic design of how we will align around the industry and how we focus on growth by design.

Clearly, you would have seen the numbers for the year. FY26 was a very strategically important year for us, which has shown in the results and our strategy.

We've shown significant top-line growth and strengthened our balance sheet and continue to deepen our position as an AI-native financial technology platform company. Most importantly, the investments we have made over the last several years in composable architecture, enterprise AI, and deep financial domain specialization are now delivering the compounding scale which we really needed.

Today, we operate across 62 countries with more than 500 institutional customers, something that Arun shared that we've got more than 60 customers with very large asset size. We're primarily in the Tier 1 business as one side of our business, and on the other side of business, we work with the credit unions.

We've been able to design the business model to serve both the segments from that perspective. We continue to maintain strong domain depth across wholesale, consumer, wealth, insurance, and AI-led enterprises.

That segmentation from a product perspective and a market coverage has really played to what we defined as the arena in the Intellect Design Arena, and that strategy is working. The 2 million hours annual R&D, which you look at at a $50, it's like a $100 million from an American perspective.

That's the kind of courage we have had to invest in going in building this us. Our advantage is our unit costs are low.

If it was an American company, that would translate that on an annual basis at least a $100 million R&D, and that's what's kept us edged continuously in the market. I think like Arun called out, we saw the trend early for AI, and we started investing in 2016-17 around this.

AI is evolving through multiple stages from experimentation to data and AI, data as a platform, to where we now believe we are in wave six, where AI-native enterprises is what will define who you are and whether or not you'll be able to take advantage of this wave. Continuing to remain in experiments will not help, and that's where we're helping number of large institutes to actually become AI-first digital banks.

Second piece of strategy, like Arun shared, the two-platform approach create our unfair advantage. One is eMACH from a composability and Purple Fabric from an AI-enablement.

That's why eMACH.ai together helps us deliver a AI-first approach of who we are. We looked at the three dimensions of designing any of the strategy, and part one of that is designing for our products, part two is designing the markets where we'll take these products, and third was designing a customer portfolio.

This is a very structured approach, which for last 10 years we have followed, and it shows up in our results as we go forward. This framework has allowed us to scale on defined strategic focus over a multiyear cycles with greater predictability.

We call that from an initiation to how quickly we get to cycle one, where we get about a ₹500 crore. We put them slabs of ₹500 crore each from a cycle growth perspective, to where you've got the market trust, to where you are preferred in the market, to being a market leader, category leader.

These three cycles we have looked at it, and as we go forward, we've categorized also for your information how each of our business lines have got that leadership. Wholesale banking business is now fully mature in cycle three at ₹1,500 crore-plus revenue from that perspective.

We started in '16-17, if you look at a 9-, 10-year cycle, it's brought us here. Now it's about how the next ₹500 crore can come in a faster time.

2 years later, we started on consumer banking, and now very happy to announce consumer banking has also crossed ₹1,000 crore this year. Our youngest business, where we started investing on wealth, capital markets, and insurance in '22-23, streamlined to take it forward, is also crossed ₹500 crore business.

This is a repeatable pattern, which proves that focus, how you go from cycle one to cycle two to cycle three, it's not being opportunistic. It is design choices which we have taken every 3 years to invest forward.

I think Arun mentioned that we looked at every 6 months as a strategic phase to define innovation, grow engines of how we will see it through any of these journeys. This is just a snapshot of how we have invested one or two platforms every 6 months and take it forward to scale to support our vision and opportunity in the market around eMACH and AI.

Go forward. Over this period, this has not only been accepted by customers, which shows in our results of the number of customers we acquire, but also the industry analysts and industry awards.

Across the 3-year window, we've got 56 analyst leadership, we are in a number one or a number two category, and 18 industry awards where we are leaders in there. It's a consistency of our performance and vision which is evident over here across all phases.

As we look forward, I think creating the moat was equally important. If you just clearly see, in the last year, we've filed for close to 100 patents.

That's the differentiation, and this is where our company is going to create an edge in the market. We have overall got 125 patents filed, and nine have been granted and the balance are in progress.

We are creating this wedge so that the innovation we are investing upon, the disruptive technology, others cannot take advantage of doing from that. We look forward to this IP moat in our products to continue to go forward.

Next slide. I think from designing our products, we graduate to designing our market presence, and we took a structured approach.

Initially, we drew our journey through Europe, and then we went into Middle East, Asia, India. Over the last 4 years, there's been very significant focus in building the Americas business, and last year has been exceptionally good growth you see.

This is what we are looking at. Americas business has grown manyfold from that perspective, has got 27%.

The good news is, while one market share has grown, we continue to maintain a 20% to 20 The lowest market is 13% to 27%. It's a very balanced growth across.

Either market, the fluctuations doesn't hurt us right now. If one market there's some geopolitical issue happening, pivot of focus last year was difficult for Europe, we pivoted strongly to Americas, and it shows in the results.

We were able to manage the European revenues to where it was, but grow Americas from that perspective. Now, with a decent depth in each of the markets, ranging from ₹400 crore to ₹800 crore, we're able to pivot and insulate ourselves against any unplanned incidents which happen in the market.

Next. Third piece is designing a customer portfolio.

We sharpen our products for the markets, and we choose which customers we're going to grow up. We've strongly been a Tier 1 product market space where we have excelled in, and this shows that we today have 500-plus leading global, regional, and challenger banks who trust on Intellect.

If you look across geographies, the top 60% of top 10, 15, or 20, we continue to grow that. Those are our leader brands where the banks trust us, and as they go global, it increase our distribution and our strength of each of the products.

That pattern follows all the regional banks wanting to adapt, and then the local banks wanting to adapt. That journey of establishing trust, we may have started with a difficult, larger banks, but that's established our leadership in the market.

This is the proof point of our success, and we continue to grow this. You would have seen this slide evolve every year from where it was to what we are today.

These are our two gem stones who have helped us reach here. Next.

I think this is also evident in our pipeline, which has now crossed ₹12,000 crore. We've got 99 destiny deals which are available.

In 25-26, we had 21 destiny deals which we won, which were multi-product, multiyear programs at marquee institutions. These deals compound, actually.

You enter with one product with a $3 million to $5 million annual revenue, and then when you bring in the second product, the ARR grows from $5 million to $7 million. That equation of cross-selling, focusing on your large accounts, you serve them well, you build trust, you deliver on time.

That marketplace is very large. Individual customers are a marketplace, and based on that strategy, we are deepening our investments around our existing customer base.

They are our crown jewels. Go forward.

This is the snapshot of high-value pursuits we are running across ₹50 crore, ₹30 crore to ₹50 crore, ₹20 crore to ₹30 crore, and these are the 99. Very focused attempt to play in a larger size.

These are the Q4 strategic wins which we have had, with four large wins across Americas, two across Europe, and five across Middle East. If you see, and two in India and two APAC.

All markets, we have managed to show wins across, which are material deals which have made a difference to our numbers from that perspective. Next.

I think the five new design choices for the next 3 years where we are looking at is, like we said, Arun initially mentioned and I started off with, native AI companies, and this is where Purple Fabric scaling is happening right now. This is truly a platform-led business, which shows also in our revenue, that how platform-led business is growing against the conventional just licensing business.

A second pattern we are seeing is there's a significant shift to move away from mainframe to cloud, and this is where our eMACH tech stack, both its proof points of having moved multiple mainframe platforms to a cloud platform and the composability of it for large Tier 1 transformations, has proved, and we're scaling up our investments behind it, and we've seen a good market traction. The wholesale banking platform, we graduated from a transaction banking to wholesale banking.

This is an ecosystem play across deposits, lending, cash, liquidity, trade, supply chain. We're continuing to expand around our moat of what the wholesale bank needs and how we can offer that as an integrated composition.

Payments is the fastest-growing area across, and multiple things are happening, from embedded to cross-border to real-time. This is where we're making a significant difference, and there have been multiple wins in the last year.

The fifth one is on financial advisory around wealth, insurance. This is our youngest platform, but truly leading with AI-first for the next-gen investors.

This is making a big difference. Each one of you would be also looking at AI in your worlds, and this is where we're helping, which is giving us big wins right now.

Next. Vasudha, you'll take up from here?

Thank you, Manish. Good evening, everyone.

Happy to take you through the financial highlights for the quarter and the financial year 25-26. The financial year 25-26 has been a year of strong growth, improving business quality, disciplined execution, healthy collections, and sustained investment in long-term strategic initiatives.

Move on, Dhanraj. For the full year '26, Intellect reported a total income of ₹3,161 crore, representing a 23% year-on-year growth.

License-linked revenue comprising platform, license, and AMC revenues increased to ₹1,667 crore, representing a strong 34% year-on-year growth. Breaking this down further, platform revenue increased significantly to ₹580 crore from ₹241 crore in financial year '25, representing a 141% year-on-year growth.

License revenue stood at ₹517 crore. AMC revenue was ₹570 crore, reflecting continued strengthening of annuity and recurring revenue streams.

Moving to profitability, gross margin for the year stood at ₹1,786 crore, representing a 19% year-on-year growth. EBITDA for the year was ₹703 crore, representing a 16% year-on-year growth.

The non-GAAP EBITDA, which excludes the stock compensation cost, was ₹756 crore, which represents a 24% of the income for the year. PBT before considering exceptional items was ₹493 crore, while PAT stood at ₹369 crore for the year.

PAT after considering exceptional items stood at ₹345 crore, and the exceptional item comprises of the gratuity provision for ₹30.84 crore and the resultant deferred tax impact of ₹7.76 crore, which we have accounted in Q3. Collections remained strong during the year at ₹3,043 crore as compared to ₹2,371 crore in financial year '25, which represents an increase of ₹672 crore year-on-year.

We closed the year with cash and cash equivalents of ₹1,257 crore, an increase of ₹236 crore over financial year '25 from ₹1,021 crore. Intellect continues to maintain a strong balance sheet and zero-debt position.

Talking about our deal wins and digital transformations, 59 new customers selected Intellect for their transformation journey, and 91 digital transformations went live globally during the year. Another positive trend during financial year '26 has been the continued strengthening of our balanced geographic revenue portfolio across developed and growth markets, which Manish talked about.

Yeah. Moving to Q4, total income for the quarter stood at ₹884 crore.

Platform revenue for the quarter was ₹162 crore, and license revenue was ₹152 crore. Our ARR for the quarter stood at ₹1,247 crore as of Q4, up by ₹870 crore as of the same quarter last year.

We achieved an EBITDA of ₹221 crore for the quarter and a PBT of ₹162 crore. Collections for the quarter were ₹791 crore.

Another important indicator of our operational discipline is our working capital efficiency. Our DSO for the quarter stood at 126 days as compared to 137 days for the same period last year.

We also continued to strengthen leadership capability across the organization, with 23 senior leaders joining Intellect during financial year across strategic functions and markets. Move on, Dhanraj.

You can move on. Let me briefly cover the important board and organization announcements for the quarter.

In line with the company's dividend distribution policy, the board has recommended a final dividend of ₹4 per share along with a special dividend of ₹3 per share on equity shares of face value of ₹5 each for the financial year 25-26, subject to shareholder approval at the ensuing AGM. The record date for determining shareholder entitlement has been fixed as July 24, and the dividend upon approval will be paid on or before August 29, 2026.

Move on, Dhanraj. Move on, Dhanraj, yeah.

On the organization front, the year marks an important leadership transition phase for Intellect. Mrs.

Sudha Gopalakrishnan, Chief Assurance and Governance Officer, will retire from the services of the company effective 31st May upon attaining the age of superannuation. The board has placed on record its sincere appreciation for her valuable contributions during her tenure with Intellect.

As part of the leadership transition, Mr. Krishna Rajaraman, currently the Chief Technology Officer, will transition into the role of Head, Customer Delivery Experience, effective 1st June.

Mr. Vivek Gupta, currently President and Head of Consulting, will be redesignated as Chief Customer Officer effective 1st June 2026.

In addition, Mr. Prashant Lalchandani has been appointed as the Chief Technology Officer of the company effective 1st June.

Prashant brings over three decades of experience across product engineering, enterprise architecture, and global banking platforms and has played a vital role in shaping Intellect's AI-native engineering and eMACH platform evolution. These leadership transitions further strengthen Intellect's long-term execution capability as we continue to scale our AI-first and platform-led transformation journey globally.

Move on, Dhanraj. Finally, here is our investment thesis.

We are leading through five key differentiators. Number one, AI-native leadership: our wave six infrastructure is live in 45-plus global institutions, giving us a massive first-mover advantage.

Secondly, we are a zero-debt company, our growing cash reserves and recurring ARR engine provide a stable, compounding foundation for high-margin returns. With 30 years of expertise across 62 countries and 500-plus clients, we possess a deep domain moat that competitors simply cannot replicate.

Our pipeline is robust, featuring 80-plus active pursuits valued at over ₹20 crore each, ensuring strong revenue visibility and momentum. The synergy between eMACH.ai's composability and Purple Fabric's intelligence creates a compounding effect, moving us from linear growth to exponential platform value.

As we move into financial year '27, we remain confident in the company's long-term positioning, business quality, and strategic direction. With that, can we now open the floor for questions?

Yes.

Thank you.

Thank you, Vasudha.

Thank you, Vasudha. Now the forum is open for Q&A.

In case you want to ask a question, please click raise your hand so that we can unmute you. First, we have Mr.

Rahul Jain from Dolat Capital. Rahul, unmute yourself.

Rahul, you are there? Rahul?

Yeah. Hi.

Hope I'm audible.

Rahul. Please go on.

Yeah. Thanks for the opportunity, and congratulation on very strong numbers and our excellent presentation as well.

Just two, three aspects I wanted to touch upon. One, we have talked about this next 18 months of monetization that we see on eMACH.ai side.

On this particular offering, do we see the mix of product being on the license side of it or it will be more on the subscription side of it? Any trend if we could identify for this product, that is question number one.

Okay. If you look at it, our implementation revenues are fairly decreasing in percentage terms as the growth is increasing.

License-linked revenues are growing faster than other. You are asking subdivision of license versus subscription.

Our focus is to get to more subscription revenue, which is long-term in nature. We are not letting go the license revenue, where the large customers are there for license revenue.

Forecasting that will be difficult, which number will grow faster. Our intent will be to get more subscription revenue, but outcome will determine based on the market situation.

That's clear. From a growth point of view, this five five key reason that we have highlighted, this yearly sets up for a growth acceleration thought process.

Do you think that next year onward, right from FY27 onwards, we could see our growth accelerating or we are more thinking about this from a medium-term perspective and not necessarily from an FY27 perspective?

See, we're getting a good traction. ₹12,000 crore of a pipeline we never had, and this pipeline is qualified.

We always mention to you that predicting anything of this nature of the revenue modeling on quarter-to-quarter basis are more difficult for us than projecting the trajectory of the company. Trajectory of the company moving from ₹500 crore a quarter to ₹600 crore a quarter, to ₹700 crore a quarter, to ₹800 crore a quarter.

We are able to forecast that, okay, we will move from ₹700 to ₹800 in two to three quarters or three to four quarters, and that we are able to sustain. Which revenue, which particular piece will come from which geography So we have a complex business of at least six markets and three LOBs and 10 product lines.

From investor perspective, it's a very well-balanced portfolio. From product side, there is sufficient capacity to grow, saturation is avoided at product level.

Saturation is avoided at a market opportunity. Market risk is avoided at a market level.

We are looking the whole business into two pieces: one is product on product side, market on market side. We are preventing the market risk on one dimension, and we are ensuring that we have sufficient product in a market so that we don't hit the saturation button, which many company with a single-product company button, they reach a saturation point where they become cash companies, but not growing companies.

Ensuring the cash and growth both comes together is a strategy when we look at arena model of business. Now we are demonstrated at last 10 years that this model works.

It takes 5 years to get into the sustainable model when we start investing GTM money, because the R&D space of Purple Fabric we are investing between 2016 to '21, but go-to-market took '22 onwards. You take almost 5 years' cycle time, and things are below the iceberg.

It's not driving any numbers. Those investments like ₹92 crore investment in AI business last year, we said ₹130 crore, we'll land up into ₹92 crore investment, and we have a order book of over $50 million on AI business we booked last year and a revenue of ₹160 crore from in this year.

That's what we are able to project, Rahul, that we are saying we are growth by design and margin by design.

Yeah. Just one last aspect from my side, and then I'll go back into the queue.

One thing we've been articulating well is that how well we are positioned in terms of the kind of an offering that we have, which are best-suited for the customer. Purely from a demand side of it, you think is there an incremental traction even from a demand side of it or most of our success or pipeline is getting encouraged because of our better qualification and our better offering and winning market share?

Manish

Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking): Manish, you want to Rahul, you answered it yourself. Combination of all the elements over there: better qualification, better market rate, better acceptance in the market.

We continue to win big with our own existing customers. Our portfolio is designed for that perspective, there's less anxiety in the portfolio.

Year-on-year, we said we have a certain band we want to operate in, and I think this year we managed to demonstrate that, and keep up that consistency is where I'm looking at helping contribute towards.

Right. Just to the engine that you talked about, we should refer it as 15% to 20% from the growth point of view and 20% to 25% from a margin point of view, is that the right band to think about?

That's the same story, matlab, which I told in '16-17, I have not changed the trajectory. I say we are designed to always grow at 20% because when you are running a company, we design the business for 20%.

There are some external factors are there, win rate are there. We achieve 15%, we achieve 14%, we achieve 17%.

I will keep that Why we are running arena? Because we would like to see that we don't get saturated and we don't become single-digit growth engine, and that's the design part of it.

How much you succeed is a factor of not factor of market, factor of some situation to happen, some elements happen, but it covers up later on. On a growth trajectory perspective, from ₹600 crore trajectory to ₹3,000 crore trajectory, in last 10 years, five-time trajectory, I think we're not disappointed any investor over the last 10 years from ₹600 crore trajectory to ₹3,000 crore trajectory.

Again, forecasting FY27, FY28, we're designing definitely for 20%. Again, design-wise, we are still looking 20%.

Whether we achieve 15, we achieve 14, we achieve 12, I think time will tell. Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

We're taking it in bite sizes: grow by ₹100 crore over a two-, three-quarter, keep driving, keep succeeding on that, and that is now predictability showing up.

That's a very simple matrix. It's a ₹800 crore to ₹900 crore.

Now the next milestone will be crossing ₹800 crore. This quarter, we are ₹880 crore.

If we retain ₹800 crore-plus for next two, three quarters, that will be our challenge right now.

Sure, sure. Just last bit [laughter].

On the investment side, last year we accelerated because of the AI offering that we wanted to take it to the customer. Any update on that in terms of do we need to continue the run rate, need to accelerate on that?

On the monetization side, how we are seeing it? Thank you.

Investment will be continuous, Rahul. Again, I'm saying, last 10 years, we want to keep the margins between the 20%, 25%, EBITDA margin between 20% to 25% range.

That's a trajectory we are looking at it, and we would want to reinvest back into either creating a delivery capacity or creating a sales capacity or creating a R&D capacity. Those investments we take a conscious call two quarters in advance.

When we take a call of increasing the capacity, suddenly the margin drop happened, which get recovered after two quarters. There's a lag between when we invest upfront, like in quarter one we invested, then there's a sudden drop in the margins in quarter three, which is experienced.

This is happened not one time. This happened multiple cycles.

If you look at the books, we have invested, and after three quarters, if you look at the same number, you will find suddenly margin goes up to 27%, 28%, and there's, oh, is this margin sustainable? Then we reinvest back that money.

That's how the trajectory moves from ₹600 crore to ₹700 crore, ₹800 crore. If we focus on margin, then I will able to manage the margin, but may not be able to manage the growth.

Thank you and best wishes.

Okay.

Thanks, Rahul. Next we have Mr.

N. J.

N. Puranik from ENAM Securities.

Puranik, please unmute yourself.

Hi, Arun.

Hello, Puranik.

Brilliant quarter. Brilliant year.

I think looking strong on the momentum. You are mentioning about one important thing: accuracy as a competitive advantage in a model when it comes to selling solutions to banking industry or perhaps I would add energy, aerospace, these are all accuracy-sensitive.

How did you achieve this, and how do you sell this accuracy to the top 60 customers you talked about?

Yeah. Very good question, Puranik.

My favorite question that last 12 months, the amount of hours I spend in researching the AI, I would not have spent that much amount of time personally in the last 10 years. It's becoming using the Indic system of knowledge systems to Western system of knowledge systems.

I have to use Tatva Sutra. I have to use Vaisheshika Nyaya Shastra, and I have to use some of the global system of knowledge of Harvard, MIT published papers on mathematics and physics to see what is a knowledge system means.

What is the core of knowledge? How knowledge get designed, how the knowledge gets constructed.

A shloka is a deterministic knowledge. Shloka knowledge you can't make it knowledge change in the shloka because it's embedded with a encrypted knowledge.

Shloka is encrypted knowledge is there. Now, that is a deterministic knowledge which is required for any institution to work on, and that I call deterministic knowledge.

In physics, there is a word called probabilistic and deterministic.

Correct.

Now we need to look at providing a right solution for the industries which are focused on deterministics paradigms. The industries which are not deterministic like healthcare is not deterministic, but banking, financial, aerospace, defense will be deterministic in nature.

For that deterministic nature, then I have to apply how the classification of knowledge happens, which is Vaisheshika Nyaya Shastra. Vaisheshika talks about classification of knowledge, Nyaya Shastra talks about judgment of the knowledge, How do you make a judgment that this is right knowledge, this is not a right knowledge?

Once the judgment is right, then only it can convert into intelligence. My advantage is I using the Western tools and Eastern philosophy to work together to make it a better knowledge accuracy.

Great combination.

This is what we are now finding, the institutions which we went in July, August, September. They said, oh, we have 100 people, MIT team, who are doing with AI work.

Now they're calling us back to tell us how are doing it. That time they said, 'No, no, we don't need you.

We don't need your platform. We already have our own teams working,' except the two financial institutions, those who are doing experiment maybe earlier and they realize that they're not able to get it.

This IIT engineers or MIT may not be able to get a accuracy because they're not in this industry.

My question is, how do you sell to these 60 customers?

They're coming. They're coming one by one.

We have submitted five five RFP already out of 60, we are working with them.

Over time, you can see at least 10, 20 of them buying for accuracy?

More than that. I think we should be getting almost 30, 40

customers

buying in next 2 years.

The average deal size is of what? It

depend on the monetization. As of now, the pricing we are starting to be lower end of $250,000 to $500,000, but idea is to move to $3 million to $5 million.

Idea is a platform sale. It's like Salesforce, when they enter in India, they sell the Salesforce in $100,000, but today Bajaj pays ₹100 crore for single instance.

That's how the platform sales happen.

You also mentioned about that you are in the final stages of large wins in eMACH space. What exactly is that?

These are the core modernization space, which is the mother of all the deals, and so those are people are because what you're bringing is a lowest TCO and fastest delivery. That space of mainframe to cloud is still the biggest cost is mainframe cost in Americas and Europe, and they have to move to cloud.

This M2C delivery model in which Manish covered is a very big opportunity for us to demonstrate our capability. We are working with Kyndryl, we are working with IBM, we are working with other AWS as a partner.

That's how the eMACH stack is most conducive to sell to these large deals. The cycle time of this deal could be varying from 12 months to 18 months.

We have made OTP, which we won the deal 18 months 24 months back, we won the deal 2 years back. Today, both the places, eMACH.ai is live in Hungary as well as Bulgaria.

These two countries are live with eMACH. We demonstrated that within 18 months, we are able to put the system live with eMACH, which is a good reference point which will accelerate our journey going forward.

This eMACH space you're talking about is also in the 60-customer category targeting?

This 60 plus for that the new customers are also coming, not 60, but they're all new customers.

Because

we don't have so many large customers in America. America is a big market for more than them at least 70, 80 banks which has $100 billion-plus assets in America alone.

That market size will open up because now we are close to ₹1,000 crore in Americas, ₹800 crore. We are touching $100 million business in Americas.

That's a good traction. You always used to ask, when are you going to America?

We always said, we'll go to America last.

Then

once we go last, we are ready to go to hit the market. If you would have gone earlier, which a lot of investors was anxious that why you are not going to America in 2020, 2021, and we kept on deflecting that point that we will go as per the strategy.

We will not push just because America gives more revenue, because they penalize the vendor also if you're not working out well.

You also talked about keeping hoards of cash versus growth, so that means there is an acceleration in R&D dollar?

That's definitely. R&D dollar will go up because now we have a designed R&D.

Now we have a patent. Now 100 patents we filed last year.

This momentum will go up to 150 to 200 patents in coming years. R&D spend will go up, and today we have a net capitalization is less than ₹450 crore for the company which is getting a license revenue of ₹1,000-plus crore-plus, my net block is 450 ₹450 crore.

What's the money multiplier you have in mind, R&D dollar to potential sales?

The multiple is too much, if I can start calculating [laughter], each investment which we make ₹100 crore in R&D, we generate ₹1,000 crore in next 10 years, as simple as that. Now,

I want you to, at some time, articulate on this power of this 127 patents. Some point in time, maybe it maybe difficult to evaluate now,

at

some point in time.

Because a

lot of value sits in the patent, and if you can articulate in your chairman's annual report, and what that means, what do they production patents, what are they productivity patents, what are the revenue patents, what are the defensive patents? If you can just articulate that, that will be wonderful.

At some point in time.

Beautiful. I think the journey will happen after 2028, matlab we are looking patent monetization journey sometime in 2028 or '29.

That is the next phase of our journey. This 25-26 is going on.

For 3 years, now we are filing the patents. We'll create a close to 500 to 1,000 patents in next 3 years, and then the licensing the patents will be another revenue stream will start.

That will be after '29.

Thanks a lot, Arun. Thank you so much.

Thanks, Puranikji. Next we have Mr.

Krish Jain from LKP Asset Managers. Krish Jain.

Krish, please unmute yourself. Yeah.

Hi. Hope I am audible.

Looking at the revenue ex other income, we've seen 21.5% growth this year. Could you please highlight what was the constant currency growth this year?

It'll be 16%. You can say 4% or 5%, you reduce 4%, 5%, it'd be 16% to 17%.

Sure. 16% growth.

Looking at the revenue by Geo, it's all Canada, USA. There's a huge jump there, ₹442 crore to be exact.

That's 115% growth. Wanted to understand how much of it is attributable to the Central1 acquisition that happened last year and how much of it is an organic sort of growth.

Central1 growth could be 50% of it; rest of the 50% comes from organic.

Okay. Just final question, can we expect any M&A deals happening with all good reserves maybe not spending it on R&D, maybe like something similar to Central1 or even cash deals that can happen in the future?

Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking): You want to share?

No, that's not our core design for growth. If we see right appropriate which adds compliments to our customer strategy or a product or a market strategy, we'll look at those things.

That's not our core growth engine which we are designing for.

Since you are investors in the market, we are looking for those company where IP has been dead. We want to look acquisition for those company where which gives us a market access in Europe, market access in US, market access in Australia, where we have product set is 30-year-old, which we can replace by Central1.

I need a Central1-equivalent low-cost acquisition so that I can replace them with a eMACH stack. Those we are open to.

Since you are in the market, all of you are in the market, if you come across those companies which are I don't want to compete with the latest in the nature, but those acquisition will give me the customer access on eMACH. Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

I think an important point also to share from a Central1 perspective, while we got initial customer contracts, we cross-selling them DEP right now and bringing them on to our new platform. Within a period of 18 months, all of those contracts I would have resold and resigned them, and I'm cross-selling multiple other products to them.

That was, like Arun said, an access to the market and old technology, which way we could cross-sell. It worked for us.

Oh, yeah. Sure.

That's all from my side. Congrats on a good year, and all the best for the future.

Thank you.

Thanks, Krish. Next we have Maitri Shah from Sapphire Capital.

Maitri Shah. Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

Maitri, you may unmute yourself and start speaking.

Please unmute yourself, Maitri. Looks like Maitri is not there.

Then we have Mr. Mayank Babla.

Mayank Babla from Carnelian AMC. Mayank?

Am I audible now?

Mayank, please go on. Yeah.

Hi. Thank you for taking my question.

The first one is on the operating expenses. I see that software development expenses, SG&A, and R&E expenses have increased by 28%, 28%, and 17% respectively on a YoY basis.

Could you give some clarity on that, please?

Some of the expenses have grown up because of C1 acquisition because that cost has gone, the margins are almost breakeven point on C1. We mentioned in the beginning itself that it's a very low-margin It was basically almost like zero-margin.

That's all gone into the operating margin expense. If you take it out, then the difference will be much lower, in which SG&A, definitely, we increased the expenses for getting a better market accessibility and Purple Fabric.

Investment on AI, we increased the expenses. These are the two major areas where we are looking the expense to be increased.

R&D expense obviously will go up, it's in proportion to the revenue, it's not necessary that revenue has gone up. So

Sure, sir. An interesting point you made on R&D expenses going up because that's essentially provides fuel for the next few years or decade.

I just want to understand what will be the accounting for this R&D, how much will be capitalized out of this and how much

will be expensed? In 1980 was how much?

₹160

crore. ₹160 crore.

Last year we, in the year 25-26, we capitalized close to ₹160 crore. What has been charged off to P&L was ₹235 crore.

Okay. You mentioned that this will increase.

Yeah.

Sorry.

Go on, please.

You mentioned that this would increase, what is the estimate that we should take going ahead?

I think you look at that we are maintaining a investment to dollar, $20 million we keep investing. Around if you look at the last 20 year last 10 years, all the time, our investment was ₹120 crore, ₹140 crore, ₹160 crore.

Now it will be close to ₹180 crore, ₹190 crore, ₹200 crore, between ₹190 crore to ₹200 crore now. This is giving us a bucket for investment.

In dollar terms, it's still remain $20 million, but in rupee terms, it goes up to by ₹30 crore, ₹40 crore.

All right. Thank you so much, and best of luck.

Thanks, Mayank. Last we have Mr.

Vivek Turaga from Bestpall. Vivek, you are there?

Vivek? Vivek Turaga?

Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

Vivek, I see you already unmuted. You can start speaking.

Am I audible, sir?

Yeah. Please go on.

Sir, one small request is please do that AI session for investors because there is a lot of confusion going on how Intellect per se and how, because if you see the stock prices even in US, irrespective of whether it is a service or a product company, they have taken a huge beating. With respect to that, how is the buy versus build dynamic changing?

Do you think will change, cuz everything may not be reflected in the market as of today, as of now. How do you think it will change given banks can put up their own small IT teams and do their own coding at write coding?

That buy versus build dynamic, will it change or because of the domain expertise and that vendors have accumulated like Oracle, Temenos, and Intellect, this is difficult, only very large banks can do some plug-ins, but not a core software? If you have any views on that, sir, and Arun Jain, sir.

Yeah. No, I think it's a good topic for all the investors to look at it, that what IT is going to make a difference to the IT industry, to Indian industry, and to global benefits of the bank who can invest into IT.

It's not about AI which is a problem of the banks today. The financial institution, why a large American bank have 50,000 people on IT is not because of the banking issue or IT issue or AI issue.

It's because of their multidimensional, multilayer problem, which they have created over the last 40 years of their growth. They have created a multidimensional complexity, which is multilayered.

Typical complexity, when we define, could have a 15-dimensional complexity and having a almost 8 to 10 layers of complexity. So 15 into 8 layers of complexity is a 120-dimensional complexity.

To me, AI can solve some pieces of it in a block way, but if they want to really look at the solution, they need to look at it as zero-waste architecture to start from Yesterday, there was some customer came visiting us. I think you can't solve with RFP model.

You can't say product by product and simplifying with AI. AI will not simplify your product.

If you're AI digital bank, maybe you can do it because you're taking from the fresh plate. Existing bank maybe facing the problem.

Lot of IT companies, we have internally start doing AI development lifecycle projects internally. We are finding because of deterministic knowledge, which I was speaking to Puranik, we are able to achieve significant amount of success on accuracy.

Till the time I was working on LLM model, I was only getting 80 80% accuracy for support calls and other things. Now I'm started getting 90%-plus, and then the impact start coming in.

At 80%, I'm not getting the impact of the AI. That's why bank is frustrated by Copilots.

It's a big failure of Copilots and bank are realizing that that is going to give me some individual productivity, individual performance gain, but zero outcome from a perspective of making a banking system become efficient or operational system becoming efficient. I see there are two patterns which I'm observing.

One pattern, there will be a feeling management will ask, 'What is the Copilot outcome? If we spent $20 million on Copilot last year, how much is the outcome which is there?'

There's a disillusionment will come in. Same hype cycle curve, it will come down and people will start questioning that AI is working or AI is not working.

That's the place where some of the players will move out of that window, where they are supplementing their Java resource and packaging as a AI resource. Many IT services company are packaging their existing engineers as a AI engineers, and that is not the way AI will be working.

To me, it's an transition phase where companies are repositioning, repackaging on the cover of the person that you are a AI-native engineer. AI-native engineer has to think very, very differently.

I'm personally going through the training program to AI engineer within Intellect. We have close to around 500 AI-native engineers out of 6,500.

We have a long way to go within Intellect. After 3 years of struggling, we are able to convert only 500 AI-native engineers.

The throughput of this AI-native engineer is three times the normal engineers which are there. That's the kind of a change industry will see.

If this is truly happened at '28, '29, Indian IT industry will face severe issues. Indian IT service and number of jobs will reduce substantially in '28, '29.

Nobody speaks about it because it's a fearful agenda, because if IT services job goes down, then entire industry of financial sector and the automobile sector also get impacted. That's what we need to prepare ourselves for, that unless we change quickly the model of the way we work.

This is not a gyaan I'm giving. I'm just saying this is my observation.

Maybe I'll be wrong, nobody can forecast the future, what will happen tomorrow. The change is happening in AI very fast, and many company will be able to do it.

Routine job, redundant jobs, which is a worker job, the blue-collar worker what's [laughter] in the white-collar workers, I think those definition will change in next few years.

Sir, I was more coming from buy versus build for banks. Can they, because of using these AI tools, will it shift or it will be a short term?

You don't see that Hindi

mein

bolo? Unke bas ki baat nahi hai.

Bank ke bas ki baat nahi hai. Okay.

Sir, and my second question is last concall, Manish has referred to we are in advanced stages with one I think IBM or global mainframe infrastructure leader and you said you will update on that. Any update, sir, on that?"

Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking): We're working on this M2C deals with them. Even the OTP was along with Microsoft, which we did, and we now gone live with Microsoft.

Arun announced that.

We are not free to mention the name. Is it IBM, sir, or They're

all the three: AWS, Azure, IBM,

and

Kyndryl.

Okay. Sir, one small request, apart from your AI sessions, please we are diluting around 1% of our stock every year.

If you can use the cash to buy back, it would be much better for investors in terms of wealth creation than I'm not saying I don't want dividend, but because free float enters the market, and because this sector, as you said, is having so many other issues going on, it would be better for investors both from value accretion and also stock market for free float that if you can do a buyback, it would be more George wish, but if you can consider that as a investor's request because a lot of free float is getting created and dilution is happening year on year.

Sure. We'll look at it.

Board will look at it.

Sir, and can we assume that given the five tailwinds that you mentioned if I'm assuming those are the tailwinds in the presentation that you have given. Can we assume that a 20% growth is a higher probability than the last 5 years because we had more headwinds in the last 5 years in terms of Russia war and COVID and then you had tariff issues and all these things, and now that we have US as a market opened up, a probability of 20% growth should be higher?

I'm not saying give certainty, but we are entering a phase which are more clear than the last 5 years, and given the

Let's hope. [laughter] Let's hope with the people like Trump sitting there.

[laughter] Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

We just delivered a year with 20%-plus, let's celebrate. [laughter] We will love to do it.

Please conduct that session, sir. That will be very helpful for us investors.

We are not tech people, so.

Yeah. Okay.

Thank you, sir.

Okay. Thanks, Vivek.

Arun, we have two more are there. Can we take at least one?

At least one you can take, but don't close window.

Wait, we close it? Take one more, Praveen.

Hello? Yes?

Take one more question, yeah.

Okay. Next we have Mr.

Srinivasu K. from TIA.

Mr. Srinivasu from TIA.

Am I audible, sir?

Yeah.

Yes, Srinivasu. Please briefly ask your question.

Thank you, Arun, for explaining that accuracy gap between that 76.7% versus 95% at enterprise AI expectation. Actually, that really answered most of our investor concerns.

Thanks for answering that in detail. My question is about the AI revenues that we had ₹160 crore this year.

What is the exit ARR run rate, and can we expect it to be double in next year?

We love to have it. That's what we are struggling for.

Let's see what number comes out. [laughter] Because our revenue will come twofold, Srinivasu.

One is in the area of direct Purple Fabric, and all the Intellect product, which now having a AI-first product. Any product which we are selling, now in core banking product we are selling, we are creating a knowledge layer and intelligence layer on the core banking product.

There's no single product out of Intellect now going without AI-first. If we allocate 12% of those revenues to AI's effectiveness, then those revenue also will add to the whole investment bucket.

That's what we do internally. That's will not be visible to you otherwise.

That's where the value of AI will be in.

Okay. My next question is given that Anthropic and OpenAI are launching agents every month, is Purple Fabric LLM-agnostic?

Is

it open

to

other OpenAI models and so

on? Open AI Yeah.

Always, yeah. We are open All our LLM agnostic.

That's how to be designed it. We knew that models will lapse and multiple models will come.

There are more than 2 million models in the world.

Thank you.

Yeah.

That's all from my side.

Okay. Okay.

Thank you. Manish Maakan (Executive President, Group Chief Revenue Officer and CEO of the Wholesale Banking):

Thank you, Praveen.

Thank you, Srinivasu. There are a couple of people might be interested.

In case they have any questions, please do write to us. Our time is over, we are closing the call.

Thank you for participating, everybody, and thanks the management team.

Now you can

log off.

Thank you.

Thank you,

Praveen.