Slide 1: Cover letter to stock exchanges
Date: October 17, 2024 To, BSE Limited National Stock Exchange of India Ltd. Phiroze Jeejeebhoy Towers, “Exchange Plaza” Dalal Street, Bandra-Kurla Complex, Bandra (East), Mumbai - 400 001 Mumbai - 400 051 Scrip Code: 532790 Symbol: TANLA Dear Madam/Sir, Sub: Investor Updates for the quarter ended S
Slide 2: Investor Update Q2 FY25
Investor Update Q2 FY25 Oct 17, 2024 CONFIDENTIAL AND PROPRIETARY Thousand Pillars of Warangal (Telangana), a UNESCO World Heritage site, symbolizing India's Any use of this material without specific permission is strictly prohibited timeless resilience and artistic grandeur
Slide 3: Safe Harbor and Other Information
Safe Harbor and Other Information 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 l
Slide 4: Q2 FY25 Results – Snapshot
Q2 FY25 Results – Snapshot All numbers are ₹ unless otherwise stated Revenue Gross Profit EBITDA FCF 10,007 Mn 2,618 Mn 1,754 Mn 520 Mn 0.8% de-grew 26.2% gross margin 17.5% EBITDA margin 40% of PAT PAT EPS Cash(1) 1,302 Mn 9.70 7,053 Mn Decreased by ₹ 520 Mn QoQ post 13.0% PAT margin dividend payou
Slide 5: Tanla has track record of Strong Performance
Tanla has track record of Strong Performance All n umber s ar e ₹, u nless oth erwi se stated Sustained Value Creation Best-in-class Execution World Class Culture 19% 22% 100+ 5+ 1000+ 19,749 Revenue growth1 Gross profit1 Innovations 3 Patents4 Employees in India and Training hours beyond 19% 6,596
Slide 6: Today, Tanla focuses on two synergistic businesses
Today, Tanla focuses on two synergistic businesses - Digital Platforms & Enterprise Communications Predictable growth Undisputed market leadership 26%+ growth in gross profit for ~35% market share in India FY24 Deeply embedded E2E omnichannel presence NRR of 125% SMS, Voice, OTT (WhatsApp, TrueCalle
Slide 7: Business Outcomes
Business Outcomes 6 Investor CONFIDENTIAL Update Q2 FY25 AND PROPRIETARY Tanla Immersive & Experience Center at IMC 2024 Any use of this material without specific permission is strictly prohibited
Slide 8: Customer cohorts: Expansion of Customer Relationships
Customer cohorts: Expansion of Customer Relationships 329 333 333 customers contributing > ₹ 10 315 Mn annual revenue, up by 5% on YoY basis 19 18 17 Customers contributing > ₹ 1 Cr annual revenue grew by 2% on 60 64 QoQ basis 62 13 out of top 20 customers of last year continue to be in top 20 and 2
Slide 9: Customer cohorts: Increase in Product Penetration
Customer cohorts: Increase in Product Penetration 9,326 9,524 Customers on-boarded during the 9,637 trailing twelve months (TTM) have added ₹ 417 Mn in Q2FY25 4,048 4,150 4,476 Top 20 customers are 3,115 3,346 contributing to 44% of revenue 3,294 (₹ 4,443 Mn) in Q2 FY25 Customers contributing > ₹ 50
Slide 10: Customer Concentration
Customer Concentration Revenue from top 20 customers (₹ Mn) 13 out of 20 customers of 48% 44% last year continue to be in Top 20 4,830 4,443 Q2 FY24 Q2 FY25 9 Investor Update Q2 FY25
Slide 11: Winning New Logos
Winning New Logos Revenue from new customers (₹ Mn) Count of customers 115 35% 89 New Customers added on WA 109 68 Q2 FY24 Q2 FY25 1. New customers include every unique contracting entity added during the year 10 Investor Update Q2 FY25
Slide 12: Financial Outcomes
Financial Outcomes 11 Investor CONFIDENTIAL Update Q1 FY25 AND PROPRIETARY Tanla Immersive & Experience Center at IMC 2024 Any use of this material without specific permission is strictly prohibited
Slide 13: Revenue
Revenue 19% 15% 21% 10% (1%) Revenue growth remains muted both on YoY and 10,086 10,026 10,055 10,022 10,007 QoQ basis OTT contribution to overall Y-o-Y growth revenue was at 20.3% in Q2FY25, as against 9.7% in Q2FY24 – we are making the shift to rich media (₹ Mn) Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25
Slide 14: Q2 FY25 – Digital Platforms & Enterprise Communications Revenue
Q2 FY25 – Digital Platforms & Enterprise Communications Revenue Digital Platforms Enterprise Communications De-grew by 7.7% YoY 0.1% de-grew (₹ Mn) 16% YoY growth excluding Vi impact YoY 953 9,133 9,127 880 Q2FY24 Q2 FY25 Q2 FY24 Q2 FY25 13 Investor Update Q2 FY25
Slide 15: Gross profit
Gross profit 27.4% Gross profit de-grew by 5.2% YoY. Gross 26.9% 26.7% 26.9% 26.2% margin was at 26.2% in Q2FY25 decreased by 122 bps 2,762 2,699 2,686 2,694 2,618 Digital Platform gross profit de- grew by 6.7% YoY and grew by 1.5% sequentially driven by incremental revenue from Wisely ATP and MaaP
Slide 16: Gross margin profile
Gross margin profile B 97.7% 97.5% 98.2% 98.7% 98.7% Platform A business Overall margin A Decrease in gross margin by 122bps YoY, and 72 27.4% 26.9% 26.7% 26.9% 26.2% Q2 Q3 Q4 Q1 Q2 bps QoQ FY24 FY24 FY24 FY25 FY25 B Digital Platform gross Q2 Q3 Q4 Q1 Q2 margin contribution to FY24 FY24 FY24 FY25 FY
Slide 17: Efficiency Metrics
Efficiency Metrics 67% EBITDA was at ₹ 175 Cr, de-grew by 71% 10.9% YoY and sequentially by 7.0%. The 2,762 2,618 decrease can be primarily be attributable to lower gross profit coupled with increase in indirect cost 1,968 spends 1,754 (₹ Mn) EBITDA margin declined by 129 basis points sequentially a
Slide 18: Indirect cost walk YoY
Indirect cost walk YoY 102 32 864 794 Employee cost increased by ₹102 Mn (64) due to net additions, salary increments and RSU cost Cloud and hosting charges increased (₹ Mn) due to incremental spends on infrastructure revamp initiatives Other expense increased due to incremental spends on marketing
Slide 19: Operating Income: EBITDA and EBIT
Operating Income EBITDA 1,968 1,928 1,877(1) 1,886 1,754 EBITDA de-grew by 10.9% YoY and 7.0% QoQ to ₹ 1,754 Mn in Q2FY25. This (₹ Mn) decrease can be primarily attributable to lower gross profit coupled with increased indirect cost spending Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 EBIT Depreciation
Slide 20: EBIT Profile
EBIT Profile Digital Platforms Enterprise Communications 68.3% 10.1% (₹ Mn) EBIT% EBIT% 868 1,750 601 919 EBIT Gross Profit EBIT Gross Profit 19 Investor Update Q2 FY25
Slide 21: Free Cash Flow Generation
Free Cash Flow Generation 1,492 In Q2, we generated ₹ 520 Mn as free 1,310 cash flow. Our cash collections were spilled over in Oct impacting DSO days and free cash flow 744 640 (₹ Mn) 520 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 20 Investor Update Q2 FY25
Slide 22: Profit After Tax & EPS
Profit After Tax & EPS Profit After Tax (PAT) 1,425 1,401 1,361(1) 1,412 1,302 PAT was at ₹ 1,302 Mn in Q2, impacted (₹ Mn) by lower gross profit generation and increase in indirect cost Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Effective tax rate for Q2 FY25 is at 19.0% EPS 10.60 10.42 9.69 10.50 9.7
Slide 23: Return on Capital Employed
Return on Capital Employed 42% excluding CCE as against 38% 35% 34% 31% 28% 54% last year Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 ROCE- Return on capital employed; CCE- Cash & cash equivalents 22 Investor Update Q2 FY25
Slide 24: Strong Balance Sheet
Strong Balance Sheet All n umber s ar e ₹, u nless oth erwi se stated Tanla Immersive & Experience Center at IMC 2024 21,076 Mn 7,053 Mn 42% Strong Equity and Reserves Cash & cash equivalents ROCE (excluding cash & cash equivalents) 23 Investor Update Q2 FY25 Debt Free
Slide 25: Annexures
Annexures 24 Investor Update Q2 FY25 Tanla Immersive & Experience Center at IMC 2024
Slide 26: Profit & Loss Q2 FY25
In ₹ Mn, unless otherwise stated Q2 FY25 Q2FY24 ∆% Q1 FY25 Revenue from operations (net) 10,007 10,086 (1) 10,022 Cost of services (7,389) (7,324) 1 (7,328) Profit & Loss Gross Profit 2,618 2,762 (5) 2,694 Q2 FY25 Operating Expenses (864) (794) 9 (808) EBITDA 1,754 1,968 (11) 1,886 Depreciation and
Slide 27: Balance Sheet September 30, 2024
Balance Sheet September 30, 2024 Unaudited Sep Unaudited Unaudited Unaudited Jun In ₹ Mn, unless otherwise stated 30, 2024 Jun 30, 2024 In ₹ Mn, unless otherwise stated Sep 30, 2024 30, 2024 Assets Equity & Liabilities Non-current assets Equity share capital 135 134 Property, plant and equipment 2,2
Slide 28: Condensed Cash flow Q2 FY25
In ₹ Mn, unless otherwise stated Q2 FY25 Q1 FY25 Cash flow before changes in working capital 1,761 1,901 Condensed Changes in working capital Cash generated from operations (455) 1,306 (1,302) 599 Cash flow Q2 Taxes Cash flow from operating activities (417) 889 299 898 FY25 Net investments in tangib
Slide 29: Free Cash Flow
Free In ₹ Mn, unless otherwise stated ∆% Cash Flow Q2 FY25 Q2FY24 Q1 FY25 Operating cash flow 889 1,601 (46) 898 Capital expenditure (369) (292) 17 (154) Free cash flow 520 1,310 (60) 744 Free cash flow in percent of total revenue 5% 13% - 7% Free cash flow as % of PAT 40% 93% - 53% 28 Investor Upda
Slide 30: Reconciliation
In ₹ Mn, unless otherwise stated Q2 FY25 Q1 FY25 Q1 FY24 Q4 FY24 Reconciliation Reported EBITDA 1,754 1,886 1,822 1,604 One-time expense- MWC - - - 273 Adjusted EBITDA 1,754 1,886 1,822 1,877 Adjusted EBIT 1,520 1,658 1,658 1,649 Adjusted PAT 1,302 1,412 1,353 1,361 1. Adjusted PAT is normalized for
Slide 31: About Us
About Us 30 Investor CONFIDENTIAL Update Q2 FY25 AND PROPRIETARY Tanla Immersive & Experience Center at IMC 2024 Any use of this material without specific permission is strictly prohibited
Slide 32: Tanla embeds Gen AI across all its platforms
Tanla embeds Gen AI across all its platforms Our intelligent core underlying all our products, revolutionizing digital interactions through Gen Al capabilities Wise Albert Audience.ai Content.ai Channel & Partner.ai (how to (whom to send) (what to send) send) ATP Trubloq Wisely Scam identification a
Slide 33: Greenfield opportunities: Trubloq and ATP
We have also successfully addressed several Greenfield opportunities Trubloq ATP With world’s 1st blockchain-enabled communication stack. It First of its kind anti-smishing platform. works with a consortium of telecom players and other Identification Prevention Elimination stakeholders to maintain t
Slide 34: Our Customers love us in India and beyond
Our Customers love us in India and beyond We are the player of choice in India… …and serve global giants in 4 regions ~35% 9/10 top banks served USA & Europe Global Tech giants CPaaS market share SEA 50%+ 7/10 top insurance of total revenues contributed by 50 of our top 100 customers, retained Middl
Slide 35: Our Market Leadership in Enterprise Communication (1/2)
Our Market Leadership in Enterprise Communication (1/2) Tech. backed use cases High Customer Stickiness Unmatched scale with 35% CPaaS market share 50 of Top 100 accounts > 5 years 5% increase post ValueFirst acquisition Double digit growth in every customer cohort since inception ~45% share i
Slide 36: Our Market Leadership in Enterprise Communication (2/2)
Our Market Leadership in Enterprise Communication (2/2) Tech. backed use cases Newer Channels AI/ML based solutions developed for a leading Turbo charging our growth bank 100% YoY growth in Q2 from WhatsApp Impact: 2X increase in loyalty (offers availed) for the bank Serving enterprise curated n
Slide 37: Great Financial Track Record
All fi gures i n ₹ Mn 10,040 ~4x 39,278 Revenues 2019 Revenues 2024 Great Financial Track Record We continue to 967 ~8x 7,322 deliver over the EBITDA 2019 EBITDA 2024 last five years 298 ~18x 5,483 PAT 2019 PAT 2024 36 36 Investor Update Q2 FY25
Slide 38: Thank You
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