Slide 1: Cover letter to stock exchanges
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 Date: January 23, 2024 To, BSE Limited National Stock Exchange of India Ltd. P
Slide 2: Investor Update Q3 FY24
Investor Update Q3 FY24 23 January 2024 CONFIDENTIAL AND PROPRIETARY Any use of this material without specific permission is strictly prohibited
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: Q3 FY24 Results: Snapshot
Q3 FY24 Results: Snapshot Revenue Gross Profit EBITDA FCF ₹10,026 Mn ₹2,699 Mn ₹1,928 Mn ₹640 Mn 15.3% Growth 24.5% Growth 19.2% Margin 46% of PAT PAT EPS Cash ₹1,401 Mn ₹10.42 ₹6,162 Mn 14.0% Margin 21.5% Growth Increased by ₹712 Mn QoQ 3 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 5: We have had a remarkable journey over last 5 years
We have had a remarkable journey over last 5 years Detailed ahead in appendix A. We lead We’re shaping the world of trusted digital experiences to empower consumers and enable companies with purpose We touch 1 Bn lives daily — Delivered OTP messages to enable 100 Cr + vaccinations — Facilitated
Slide 6: We lead with purpose!
We lead with purpose! Our purpose ESG at the heart of all our operations “Shaping the world We are environment We empower our Our platform of of trusted digital T= EC2 friendly customers, partners, platforms stand for experiences to employees & society governance and trust empower consumers • Achiev
Slide 7: Today, Tanla focuses on two synergistic businesses - Digital Platforms & Enterprise Communications
Today, Tanla focuses on two synergistic businesses - Digital Platforms & Enterprise Communications Undisputed market Predictable growth leadership 20%+ growth in gross profit for 14 consecutive quarters ~45% SMS market share in India E2E omnichannel Deeply embedded presence NRR of 125% SMS, Voice, O
Slide 8: A. Business Highlights
A. Business Highlights 7 © 2024 Tanla Platforms Limited. All rights reserved
Slide 9: Expanding customer relationships
Expanding customer relationships Count of customers 335 315 17 335 customers 17 contributing > ₹ 10 Mn annual revenue, number of customers up by 6% YoY 64 62 236 254 Q2 FY24 Q3 FY24 >₹500 Mn >₹100 Mn- < ₹500 Mn >₹10 Mn-<₹100 Mn 1. Customer segments are arrived at on a quarterly annualized basis (qua
Slide 10: Customer segments
Customer segments Revenue from customers (₹ Million) 9,664 9,637 Product penetration at 2.11 3,889 in Q3 on a larger customer base, driven by growing 4,475 adoption of WhatsApp and 3,724 other newer channels 3,294 2,051 1,868 Q2 FY24 Q3 FY24 >₹500 Mn >₹100 Mn- < ₹500 Mn >₹10 Mn-<₹100 Mn 1. Customer
Slide 11: Customer concentration
Customer concentration 16 47% 42% out of 20 customers of last quarter continue to be in Top 20, 17 remain in Top 30 4,714 4,239 Q2 FY24 Q3 FY24 Revenue from top 20 customers (₹ Million) 1. Customer segments are arrived at on a quarterly annualized basis (quarter revenue multiplied by four) 2. Custom
Slide 12: Winning new logos
Winning new logos 300 35% 210 New customers added on WA 322 773 Revenue from new customers (₹ Million) x Count of customers 9M FY23 9M FY24 1.New customers include every unique contracting entity added during the year 11 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 13: Serving enterprise needs | Impact case studies
Serving enterprise needs | Impact case studies Customer Use Case Impact Top consumer Consumer conversations 30% higher repeat rates on electronics retailer on loyalty-based engagement programs for programs and driving coupons awareness on 34x revenue boost with 14.5% promotional events coupon redemp
Slide 14: B. Financial Highlights
B. Financial Highlights 13 © 2024 Tanla Platforms Limited. All rights reserved`
Slide 15: Revenue growth led by ValueFirst acquisition
Revenue growth led by ValueFirst acquisition 19% 15% (2%) (2%) 14% Revenue grew by 15% YoY 10,086 10,026 Y-o-Y growth 8,696 9,111 8,335 Organic revenue grew by 5% YoY (₹ Million) Digital platforms grew by 22% YoY Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 14 © 2024 Tanla Platforms Limited. All Rights R
Slide 16: Digital Platform & Enterprise Communications revenue growth
Digital Platform & Enterprise Communications revenue growth x YoY growth Digital Platform Enterprise Communications 22% 15% 958 9,068 (₹ Million) 782 7,914 Q3 FY23 Q3 FY24 Q3 FY23 Q3 FY24 15 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 17: Gross profit profile
Gross profit profile 27.5 27.4 26.9 26.5 24.9 Gross profit grew by 24% on YoY Margin% basis. Gross profit % increased by 199 bps to 26.9% 2,762 2,699 (₹ Million) Digital Platform gross profit grew 2,413 2,168 2,289 by 24% YoY driven by Wisely- OTT Enterprise communications gross profit grew by 24% Y
Slide 18: Gross margin profile
Gross margin profile B 96% 96% 97% 98% 98% A Increase in gross Platform margin by 199 bps A business YoY, decreased by Overall margin 46 bps QoQ Q3 Q4 Q1 Q2 Q3 FY23 FY23 FY24 FY24 FY24 27% 25% 27% 26% 27% B Digital Platform gross margin contribution to total Q3 Q4 Q1 Q2 Q3 C at 35% FY23 FY23 FY24 FY
Slide 19: Efficiency metrics
Efficiency metrics 71% 70% 2,699 EBITDA to Gross profit conversion improved by 163 bps 2,168 at 71% in Q3, on back of increase 1,928 (₹ Million) in absolute gross profit 1,513 On a sequential basis, there was an increase in sales and marketing expenses which was offset by reduction in overheads and
Slide 20: EBIT profile
EBIT profile x EBIT % Digital Platform Enterprise Communication 73.2% 11.0% 934 1,765 (₹ Million) 701 993 EBIT Gross Profit EBIT Gross Profit 19 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 21: Operating income
Operating income EBITDA 1,822 1,968 1,928 1,513 1,661 (₹ Million) EBITDA margin was at 19.2% in Q3, up 183 bps YoY Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 (seq drop by 28 bps) EBIT 1,658 1,742 1,694 Amortization on intangible 1,392 1,515 assets due to acquisition was at ₹28 Mn (₹ Million) Q3 FY23 Q4
Slide 22: Strong cash flow generation
Strong cash flow generation DSO up by 2 days to 77 in Q3. Capital expenditure for the 1,472 quarter was at ₹ 442 Mn mainly 1,310 spent towards our platforms (₹ Million) 869 640 Tax payouts remain consistent (867) Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 21 © 2024 Tanla Platforms Limited. All Rights R
Slide 23: Net income and EPS
Net income and EPS PAT 1,353 1,426 1,401 1,165 1,202 (₹ Million) Profit after tax grew by 20% YoY Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Effective tax rate for Q3 at EPS 19% 10.07 10.60 10.42 8.58 8.88 EPS grew by 21.5% YoY, led by profit expansion and (₹) benefited by buyback Q3 FY23 Q4 FY23 Q1 FY
Slide 24: Return on capital employed
Return on capital employed 51% excluding CCE as against 31% 34% 38% 38% 35% 74% last year Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 ROCE- Return on capital employed; CCE- Cash & cash equivalents 23 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 25: Strong balance sheet
Strong balance sheet ₹18,904 Mn ₹6,162 Mn 51% Strong Equity and Reserves Cash & cash equivalents ROCE (excluding cash & cash equivalents) Debt Free 24 © 2024 Tanla Platforms Limited. All Rights Reserved.
Slide 26: Appendix I – Detailed FS
Appendix I – Detailed FS 25 © 2024 Tanla Platforms Limited. All rights reserved
Slide 27: Profit & Loss Q3 FY24
In ₹ Million, unless otherwise stated Q3 FY24 Q3 FY23 ∆% Q2 FY24 Revenue from operations 10,026 8,696 15 10,086 Cost of services (7,327) (6,528) 12 (7,324) Profit & Loss Gross profit 2,699 2,168 24 2,762 Q3 FY24 Operating expenses (771) (655) 18 (794) EBITDA 1,928 1,513 27 1,968 Depreciation & amort
Slide 28: Unaudited Balance Sheet Dec 31, 2023
Unaudited Balance Sheet Dec 31, 2023 In ₹ Millions, unless Dec 31, Mar 31, In ₹ crores, unless Dec 31, Mar 31, otherwise stated 2023 2023 otherwise stated 2023 2023 ASSETS EQUITY AND LIABILITIES Non-current assets Equity share capital 134 134 Property, plant and equipment 2,122 1,659 Other equity 18
Slide 29: Condensed Cash flow
In ₹ Millions, unless otherwise stated Q3 FY24 Q2 FY24 Cash flow before changes in working capital 1,945 2,055 Changes in working capital (677) (161) Cash generated from operations 1,268 1,894 Taxes (186) (291) Condensed Cash flow from operating activities 1,082 1,603 Cash flow Net investments in ta
Slide 30: Free cash flow
In ₹ Million, unless Q3 Q3 Q2 otherwise stated FY24 FY23 ∆% FY24 Free cash flow Operating cash flow 1,082 (608) 278 1,601 Capital expenditure (442) (259) 71 (292) Free cash flow 640 (867) 174 1,310 Free cash flow in percent 6% (5%) - 13% of total revenue Free cash flow as % of PAT 46% (38%) - 93% 29
Slide 31: Appendix II – About us
Appendix II – About us 30 © 2024 Tanla Platforms Limited. All rights reserved
Slide 32: We continue to disrupt the market through tech led greenfield innovations
We continue to disrupt the market through tech led greenfield innovations Multiple cutting-edge technologies leveraged across our Our platforms of platforms pride! 1. Engage 2. Communicate 3: Protect 4: Experience Developed world’s largest AI enabled End to end secure 4 proprietary AI/ML Single API
Slide 33: Great Financial Track Record
All figures in ₹ Mn Great Financial 7,916 ~4x 33,546 Track Record Revenues 2018 Revenues 2023 We continue to deliver 652 ~9x 5,879 over the last 5 EBITDA 2018 EBITDA 2023 years 191 ~23x 4,476 PAT 2018 PAT 2023 32 32 © 2024 Tanla Platforms Limited. All rights reserved
Slide 34: Wisely is our platform of platforms across all parts of the value chain
Wisely is our platform of platforms across all 4 parts of the value chain addressing needs of multiple C-suite buying centers Primary buying center Secondary buying center 1: Engage 2: Communicate Intelligence led promo solutions for Blockchain based omni-channel CPaaS sharper customer targeting pla
Slide 35: These platforms represent a large and growing TAM opportunity
These platforms represent a large and growing TAM opportunity Total addressable market (CY’23 to 27, USD Bn) Engage Communicate Protect Experience 11-13 3.5-3.9 0.7-0.8 5-6 3.7-3.9 1.2-1.3 0.4 2-3 0.4-0.5 2.5-2.7 0.3 4.1-4.5 1.7-1.9 1.3-1.4 2023 (India) 2027 with new platforms (India) 2027 with new
Slide 36: Wisely ATP - first of its kind anti-smishing platform
Wisely ATP - first of its kind anti-smishing platform AI/ML led solution to identify SMS phishing in real time, prevent the message from being delivered, eliminate the root cause A. Real time Success Markers <20ms 1 Showcased to 5 regulators globally Regulatory B. Scalable acceptance 2 Success teste
Slide 37: Tanla is now at its next inflection point
Tanla is now at its next inflection point Trubloq Launch – Acquired Introduced Wisely ATP – World’s first Gamooga to expand World’s first AI/ML led Founded Big foray into blockchain enabled solution to identify SMS Big data and AI/ML Tanla - voice, SMS communication phishing in real time, prevent ca
Slide 38: Our digital platforms are deeply embedded across the digital interaction value chain
Our digital platforms are deeply embedded across the digital interaction value chain (xx) Year of acquisition/launch Engage Communicate Protect Experience across customer lifecycle 1 Acquire Ensuring user privacy and spam End-to-end encrypted network Omnichannel interactions prevention along with ad
Slide 39: Trubloq | Game changing innovation – Blockchain powered communication stack
Trubloq | Game changing innovation – Blockchain powered communication stack Tanla’s Solution Impact DLT system (Distributed Ledger User Impact Technology) to arrest Spam 1 bn+ users touched World’s first blockchain-enabled communication stack Business Impact 3 100% of UAE Usage of cognitive computin
Slide 40: We are a platform company operating at above Rule of 60
We are a platform company operating at above Rule of 60 Characteristics Evidence Outcome High margin IP led platforms – profile 80%+ Gross Margin and 60%+ EBIT Address needs of multiple buying centres Rule of 60 Deeply embedded with customers 125% of NRR 22% YoY revenue growth Monetization at 100% o
Slide 41: 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 ~45% 9/10 top banks served NLD market share USA & Global Tech giants Europe 50%+ 7/10 top insurance of total revenues contributed by 50 of our top 100 customers, top financial SEA r
Slide 42: Our market leadership in enterprise communication (1/2)
Our market leadership in enterprise communication (1/2) Undisputed market leadership High Customer Stickiness Unmatched scale with 35% CPaaS market 50 of Top 100 accounts > 5 years share ‐ Double digit growth in every customer cohort ‐ 5% increase post ValueFirst acquisition since inception ‐ ~45% s
Slide 43: 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 Turbo charging our growth a leading bank ‐ ~4X YoY growth in Q3 from WhatsApp ‐ Impact: 2X increase in loyalty (offers availed) for the bank Serving enterprise curated ne