Tanla Platforms Ltd · NSE:TANLA
Tanla Platforms — Q2 FY2021-22 Earnings Presentation
58 slides from Tanla Platforms's earnings presentation, Oct 21, 2021
Slide 1: Exchange filing cover letter
Tanla Platforms Limited T: +91-40-40099999 (Formerly known as Tanla Solutions Limited) info@tanla.com Tanla Technology Center www.tanla.com Hi-tech city Road, Madhapur, Hyderabad, India - 500081 CIN: L72200TG1995PLC021262 October 21, 2021 To, BSE Limited National Stock Exchange of India Ltd. Phiroze
Slide 2: The world's leading brands trust Tanla - Q2 21-22 Investor Update
The world’s leading brands trust Tanla Q2 21-22 Investor Update October 21, 2021
Slide 3: Safe Harbor
Safe Harbor The CPaaS business is evolving at a fast pace in India with very little information available in the public domain on the overall market. The financial community has always sought a response on the total market size, key drivers of the industry and the competitive landscape in this space
Slide 4: State of the business: leading innovation, growth and value creation
State of the business: leading innovation, growth and value creation High Growth Best in Class Accelerated Innovation Enterprise segment market leader margins and free cash flow profile TRUBLOQ • 3 patents awarded • World’s first block chain 30%+ 4x 8x • Co-sell partnership with Microsoft • enabled
Slide 5: Acceleration across all dimensions
Acceleration across all dimensions Key financial metrics Revenue grew 44% EBITDA grew 83% PAT grew 67% EPS grew 72% year-over-year to year-over-year to year-over-year to year-over-year to ₹8,416 million. ₹1,787 million. ₹1,362 million. ₹10.04. ₹ 9,200 ₹ 2,000 8,416 1,787 ₹ 1,440 1,362 ₹ 12 ₹ 8,200 ₹
Slide 6: Platform Updates
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Slide 7: CPaaS platform offering a digital marketplace for enterprises and suppliers
CPaaS platform offering a digital marketplace for enterprises and suppliers, with a global edge-to-edge network delivering private, secure and trusted experiences Closed two new partnerships on Wisely Platform. 3 major features have been released in the platform • Enhanced behavioral marketing insig
Slide 8: TRUBLOQ
TRUBLOQ Largest blockchain platform in the world in-terms of scale, transactions, and capacity. Protecting billion+ mobile subscribers from unsolicited commercial communication including spam & fraud • • *Increase by 1% from last quarter 30.0 No of transactions (bn per month) 25.0 20.0 15.0 10.0 5.0
Slide 9: Customer Updates
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Slide 10: Mahindra Construction launches Hello Machine on WhatsApp
Mahindra Construction launches “Hello Machine” as a Whatsapp digital support program • Automated complaint management for customers and field staff across India • 5X operational efficiency in complaint logging & manual rework • 10x reduction in time to resolve complaints end to end
Slide 11: CDSL adopts scalable omnichannel APIs for SMS and Emails
CDSL adopts scalable and omnichannel APIs to process large volume of SMS & Emails to deliver regulatory communication to its customers • Seamless processing of high volumes meeting stringent regulatory deadlines • Simplified tracking & analytics with customized reporting panel as per CDSL’s internal
Slide 12: EdTech business deploys WhatsApp Business API
One of the fastest growing EdTech businesses in India deploys WhatsApp Business API to engage their audience • Created user-to-brand engagement capsules • 8x increase in number of users engaging with the brand • 60% Reduction in block rates using hyper personalization, context and content 11
Slide 13: Expanding existing customer relationships
Expanding existing customer relationships (₹ million) • Customers with revenue > ₹10M+ 8,188 have grown 46% year-over-year +46% • Customers with revenue > ₹500M 5,382 5,592 contributed 64% in Q2 21-22 as +73% against 53% in Q2 20-21 1,824 3,103 +5% 982 +31% 747 1,742 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21
Slide 14: Our large customers have grown even larger
Our large customers have grown even larger (No of customers) 175 +29% • 175 customers with annual revenue of > ₹10M+, up from 136 +31% 127 136 customers in Q2 20-21 97 • 19 customers with revenue 29 29 +90% 19 >₹500M, up from 10 in Q2 20-21 10 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Q2
Slide 15: Average revenue for >₹10M customers continues to grow
Average revenue for > ₹10M customers continues to grow (₹ million) 47 +14% Average revenue from ₹10M+ 41 customers at ₹ 47 million, growth of 14% YoY Q2 20-21 Q2 21-22 Customer segments are arrived at on a quarterly annualized basis (quarter revenue multiplied by four) 14
Slide 16: Healthy additions of new customers
Healthy additions of new customers (₹ million) In H1 21-22, we added 160 new Revenue from new customers for H1 21-22 customers as against 153 at ₹ 170 million as against ₹ 168 million in additions in H1 20-21 H1 20-21 168 +0.9% 170 160 +5% 153 H1 20-21 H1 21-22 H1 20-21 H1 21-22 New customers includ
Slide 17: Diversification of customer base
Diversification of customer base (₹ million) Revenue from our top 20 customers Top 20 customer concentration as a % is increasing of revenue is decreasing 5,504 72% 70% +35% 4,090 68% 66% 64% 60% Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Revenue Percentage of revenue 16
Slide 18: Financial Update
FINANCIAL UPDATE
Slide 19: Operating above Rule of 40
Operating above Rule of 40 • SaaS companies target to 32% 36% 41% 45% 60% 65% operate at Rule of 40 (revenue growth + EBITDA%) 44% 38% • Operated at Rule of 60 for second consecutive quarter- 65% 24% 22% 20% 21% 21% 21% 19% 16% 15% 16% Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 Revenue EB
Slide 20: Turbo charged revenue growth
Turbo charged revenue growth (₹ million) 44% 38% • Improving year-over-year growth 20% 21% 24% trajectory every quarter for the past 6 15% 8,416 quarters 6,541 6,486 6,264 • Growth driven by increase in volumes 5,832 from existing customers, new customer 4,555 addition and new use cases • Growth led
Slide 21: Gross profit growth accelerating every quarter
Gross profit growth accelerating every quarter (₹ million) 55% 58% 65% 71% 37% 36% • Gross Profit growth of 71% YoY 2,302 27.4% • Gross margin % has improved 440 1,769 1,735 basis points year-over-year 1,611 27.3% 27.7% 1,343 24.6% 1,053 23.0% • Platform business gross margin 23.1% contribution to t
Slide 22: Gross margin mix
Gross margin mix 17% 23% 25% 31% 25% 28% 72% 75% 69% 83% 77% 75% Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 • Platform business gross margin at ₹ 578 • Platform business gross margin contribution million in Q2 21-22, up 85% from Q2 20-21 to total at 25%, improved by 181 bps YoY • Enterpri
Slide 23: Improving efficiency metrics
Improving efficiency metrices (₹ million) 79% 78% 78% • Driving strong operating leverage 76% 73% on indirect cost- reduction of 500 71% basis points year-over year as % 2,302 of Gross profit 1,769 1,735 1,787 1,611 • Salary cost at 14% of gross margin 1,343 1,269 1,340 1,345 in Q2 21-22, as against
Slide 24: Strong EBITDA growth
Strong EBITDA growth (₹ million) • EBITDA growth of 83% year-over-year 210% 140% 99% 129% 79% 83% • EBITDA has improved 452 basis points year-over-year 1,787 • Salary cost has gone by ₹ 102 million 21.2% YoY, driven by salary increases and new 1,269 1,340 1,345 additions. We added net 142 employees
Slide 25: EBIT grew by 92% YoY
EBIT grew by 92% YoY (₹ million) 1,683 20.0% • EBIT has improved 497 basis 1,248 1,254 points year-over-year 1,180 19.2% 20.0% 18.0% 876 15.0% 635 13.9% Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 EBIT EBIT margin 24
Slide 26: Best in class free cash flow profile
Best in class free cash flow profile (₹ million) • Free cash flow at ₹ 2,217 million in 2,147 2,217 Q2 21-22, up 45% from Q2 20-21 1,534 1,361 1,285 250 Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 Free cash flow 25
Slide 27: Cash & cash equivalents
Cash & cash equivalents (₹ million) CCE • 38% of our cash balance is in 7,171 8,457 5,841 dollar account earning no 4,493 interest 2,470 2,339 • Current account balance is high Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 due to month end collections. To 4,055 optimize the working capital C
Slide 28: Cash & cash equivalents break up
Cash & cash equivalents break up Current Current Fixed Restricted In million, unless otherwise stated Total accounts-INR accounts-USD Deposits cash HDFC Bank 483 88 2,682 351 3,604 HDFC Limited - - 1,000 - 1,000 LIC Housing Limited - - 200 - 200 State Bank of India 4 - 168 3 175 Axis Bank 20 - 1 - 2
Slide 29: Profit after tax grew by 67%
Profit after tax grew by 67% (₹ million) 1,362 16.2% • Profit after tax at ₹ 1,362 million in 1,025 1,045 Q2 21-22, up 67% from Q2 20-21 935 15.8% 16.7% 786 815 14.3% 14.0% 17.3% Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 28
Slide 30: Double digit EPS
Double digit EPS (₹) 10.04 7.54 7.68 • Earnings per share at ₹ 10.04 in 6.87 5.85 Q2 21-22, up 72% from Q2 20-21 5.17 • EPS accretion is on account of increase in profit after tax and benefited by buyback Q1 20-21 Q2 20-21 Q3 20-21 Q4 20-21 Q1 21-22 Q2 21-22 29
Slide 31: ROCE at 247%
ROCE at 247% (₹ million) • ROCE at 247% excluding cash ROCE (excluding CCE) ROCE( including CCE) • Reflects cloud focused innovation led business model 54% 42% H1 20-21 H1 21-22 H1 20-21 H1 20-21 ROCE- Return on capital employed CCE- Cash & cash equivalents 30
Slide 32: Strong balance sheet
Strong balance sheet ₹ 10,421 million Strong equity and reserves ₹ 8,457 million Robust build up of cash & cash equivalents 247% ROCE (excluding cash & cash equivalents) Debt free 31
Slide 33: ESG achievements in Q2 21-22
ESG achievements in Q2 21-22 Environmental Social Governance Steps towards creating a greener and Giving back to the society and developing Integrating ESG in our business and formally cleaner tomorrow our employees committing to ESG principles Towards Net-zero For our employees Transparency & Good
Slide 34: ESG targets in Q3 21-22
ESG targets in Q3 21-22 Environmental Social Governance Steps towards creating a greener and Giving back to the society and developing Integrating ESG in our business and formally cleaner tomorrow our employees committing to ESG principles Towards Net-zero For our employees Transparency & Good Gover
Slide 35: Appendix
The world’s leading brands trust Tanla Appendix
Slide 36: Profit & Loss account: Second Quarter & H1 21-22
Profit & Loss account: Second Quarter & H1 21-22 In ₹ million, unless otherwise stated Q2 21-22 Q2 20-21 ∆% H1 21-22 H1 20-22 ∆% Revenue from operations 8,416 5,832 44 14,680 10,388 41 Cost of services (6114) (4,489) 36 (10,643) (7,992) 33 Gross profit 2,302 1,343 71 4,037 2,396 68 Operating expense
Slide 37: Balance sheet - September 30, 2021
Balance sheet- September 30,2021 In million, unless otherwise stated Sep 30, 2021 Sep 30, 2021 In ₹ million, unless otherwise stated Sep 30, 2021 Sep 30, 2021 (Unaudited) (Unaudited) (Unaudited) (Unaudited) EQUITY AND LIABILITIES ASSETS Equity share capital 135 136 Non-current assets Other equity 10
Slide 38: Condensed Cash flow statement
Condensed Cash flow statement In ₹ million, unless otherwise stated Q2 21-22 Q1 21-22 Cash flow before changes in working capital 1,836 1,381 Changes in working capital 846 137 Cash generated from operations 2,682 1,518 Taxes (326) (142) Cash flow from operating activities 2,355 1,375 Net investment
Slide 39: Free cash flow up 45% YoY
Free cash flow up 45 %YoY In ₹ million, unless otherwise stated Q2 21-22 Q2 20-21 ∆% Operating cash flow 2,356 1,663 +38% Capital expenditure (139) (129) +7% Free cash flow 2,217 1,534 +45% Free cash flow in percent of total revenue 26% 26% - Free cash flow conversion rate 124% 157% - 38
Slide 40: Key metrics: Second quarter 21-22
Key metrics: Second quarter 21-22 Gross Profit EBITDA PAT Gross Profit to ROCE EBITDA conversion (excluding CCE) +440bps +452 bps +221bps +501 bps +18374 bps 27.4% 21.2% 16.2% 77.6% 247% Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 Q2 20-21 Q2 21-22 39
Slide 41: Investor Contact
Investor Contact: Ritu Mehta Director- Investor relations ritu.mehta@tanla.com 40
Slide 42: Half Yearly Report April - September 2021
Q2 Q2 TANLA.COM Half Yearly Report April - September 2021 July- September 2021 April- September 2021 • Revenue increased by 44% year-over-year to ₹8,416 million. • Revenue increased by 41% year-over-year to ₹14,680 million. • Gross profit increased by 71% year-over-year to ₹2,302 • Gross profit incr
Slide 43: Message from Chairman
Message from Chairman I am very happy to present our first Investor report for Q2 21-22. Governance has always been of utmost importance to us, and this is another step towards enhancing our disclosures to help the investors understand our business better. Industry and Market – Let me give an overvi
Slide 44: Content
Content SECTION 01 TANLA OVERVIEW 04 SECTION 02 QUARTERLY TRENDS 05 SECTION 03 MANAGEMENT DISCUSSION & ANALYSIS 07 SECTION 04 CONDENSED INCOME STATEMENT 10 SECTION 05 CONDENSED BALANCE SHEET 11 SECTION 06 CONDENSED STATEMENT OF CASH FLOW 12 SECTION 07 KEY RATIOS 13 SECTION 08 KEY POLICIES 14 SECTION
Slide 45: Tanla Overview
Tanla Overview For the list of definitions please refer to page 16 Three months Ended Six months Ended (In ₹ million, unless otherwise stated) September 30 September 30 21-22 20-21 21-22 20-21 20-21 R12M (Unaudited) (Unaudited) (Audited) Revenue from operations 8,416 5,832 14,680 10,388 23,415 27,70
Slide 46: Quarterly Trends
Quarterly Trends Revenue Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 (In ₹ million) 19-20 19-20 19-20 20-21 20-21 20-21 20-21 21-22 21-22 Platform 191 236 209 185 328 477 462 554 624 Enterprise 4,681 5,154 5,012 4,371 5,505 6,065 6,023 5,709 7,792 Total 4,872 5,390 5,221 4,555 5,832 6,541 6,486 6,264 8,416 Gross pro
Slide 47: Profit/(loss) after tax
Profit/(loss) Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 after tax 19-20 19-20 19-20 20-21 20-21 20-21 20-21 21-22 21-22 (In ₹ million) Profit/(loss) (470) 6.7 (891) 786 815 935 1,025 1,045 1,362 after tax Profit after - - - 17.3% 14.0% 14.3% 15.8% 16.7% 16.2% tax margin Earnings per Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Shar
Slide 48: Management Discussion & Analysis
Management Discussion & Analysis July- September 21-22 Revenue Revenue grew by 44% year-over-year to ₹ 8,416 million. Revenue growth is driven by a combination of increased volumes in existing business, new customers, change in price and new use cases. We have also benefited on year-over-year basis
Slide 49: Bank Accounts Yield % and cash composition
Average fixed deposit balance for the quarter was ₹ 3,650 million. We are generating average yield of 3.4% on fixed deposits with HDFC Bank, State Bank of India, HDFC Limited and LIC Housing Limited which is in line with our investment policy. Fixed deposits were placed in HDFC Limited and LIC Housi
Slide 50: Earnings per share
Earnings per share Earnings per share grew by 72% to ₹10.04 year-over-year. EPS accretion is on account of increase in profit after tax and benefited by buyback of shares during the period. (In ₹ ) Q2 21-22 Q2 20-21 Basic earnings per share 10.04 5.85 Weighted average number of shares 13,56,72,000 1
Slide 51: Condensed Income Statement
April to September 2021 Revenue Revenues grew by 41% year-over-year to ₹14,680 million. Gross profit Gross profit grew by 68% year-over-year to ₹4,037 million. Platform business gross profit grew by 127% year-over-year to ₹1,112 million and enterprise business gross profit grew by 53% to ₹2,925 mill
Slide 52: Condensed Balance Sheet
Condensed Balance Sheet Particulars Sep 30, 2021 Sep 30, 2020 (In ₹ million) (Unaudited) (Unaudited) ASSETS Non-current assets Property, plant and equipment 317 310 Platforms 587 102 Customer Relationships 319 444 Brands 21 57 Technology 25 58 Non-Compete 33 40 Intangible assets under development 12
Slide 53: Condensed Statement of Cash Flow
Condensed change in equity statement Equity Statement Retained Other Share capital Reserves Total (In ₹ million) earnings contributions Opening balance 01 April 146 6,877 (164) 159 7,017 2020 Profit for the period 1,601 1,601 Other comprehensive (33) (33) income Issue of equity shares 7 194 201 Shar
Slide 54: Key Ratios
Key Ratios Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Key financial ratios 19-20 19-20 19-20 20-21 20-21 20-21 20-21 21-22 21-22 Rule of 40 129.5% 103.1% 75.4% 31.9% 36.4% 40.7% 44.9% 59.5% 65.5% Revenue growth 123.0% 91.3% 64.2% 15.0% 20.0% 21.0% 24.0% 38.0% 44.3% Gross margin 20.2% 19.2% 21.4% 23.1% 23.0% 24.6% 2
Slide 55: Key Policies
Key Policies Basis for preparation of financial statements The Consolidated financial statements of the Group have been prepared in accordance with Indian Accounting Standards ("Ind AS") as notified under Section 133 of the Companies Act, 2013 (the "Act") read with Rule 3 of the Companies (Indian Ac
Slide 56: Risk Management policy and Related Party Transaction Policy
Risk Management policy: We are affected by general economic, financial, and regulatory developments at the domestic and international level, as well as by conditions specific to certain countries or regions. We have put in place a structure, procedures, and control systems to detect risks and implem
Slide 57: Definitions
Definitions Platform business segment Capex expenditure Platform business segment refers to all revenue generated from Investments in platforms, IT & Networks and facilities during the period. “Platform as a service offering” where only cloud and hosting charges is Development cost incurred on intan
Slide 58: About Tanla and Forward-looking statements
About Tanla Forward-looking statements Tanla Platforms Limited transforms the way the world collaborates and This document might contain statements that are forward looking in communicates through innovative CPaaS solutions. Founded in 1999, it nature. All statements other than statements of histori