Seshaasai Technologies (NSE:STYL) Q2 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to Seshaasai Technologies Limited Q2 FY 'twenty seven Earnings Conference Call. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr. From E and Y Investor Relations team. Thank you, and over to you, sir. Thank you, Sagar. Welcome, everyone, and thanks for joining Seshaasai Technologies Limited q two f y twenty seven earnings call.

0:49 The results and presentation have already been mailed to you, and you can also view them on our website at www.seasai.com. In case anyone does not have the copy of investor presentation or press release, please do write to us, and we will be happy to share them with you. To take us through the results today, we have the management of the company represented by Pradhat Lalwani, chairman and managing director Gautam Jain, full time director and Pawan Kumar, chief financial officer. Pragmat will start the call with brief overview of the company and business update, which will be then followed by Pawan, who will take us through the financial performance for the quarter, and then we will open the floor for q and a session.

1:39 As usual, I would like to remind you that anything that is mentioned in this call, which reflects any outlook for the future or which can be considered as a forward looking statements, must be viewed in conjunction with the risks and uncertainties that we face. These risks and uncertainties are included, but not limited to what we have mentioned in the prospectus filed with SEBI and subsequent annual reports that you can find on our website. Having said that, I will now hand over the call to Pragmanji. Over to you, sir. Thank you, Prateek. Good day, everyone, and thank you for joining us for our q two and h one f y twenty seven earnings call.

2:28 I hope you have had the opportunity to review our financial results and presentation. Let me first take you through the key business highlights, after which, Pern will discuss the financial performance. We are pleased to report another quarter of healthy growth. Revenue from operations increased 15% year on year and seven point seven percent sequentially to rupees 4,053,100,000. For the first half, revenue increased 17.9% year on year to rupees 7,817,800,000. The quarter combined broad customer engagement with a meaningful sequential recovery in profitability.

3:18 Payment solutions was the principal growth driver in q two. Revenue reached rupees 2,182,600,000, up 21.7% year on year and 38% sequentially. Revenue growth was broad based but led by payment solutions supported by higher volumes of payment cards across banks, metal cards growth, mass transit programs, and payment card exports. We retained wallet share with our largest customers and won one multiyear tender during this quarter. Communication and fulfillment solutions revenue was rupees 1,290,100,000. It remained broadly stable year on year, but moderated sequentially because q one and q four carried larger volumes and certain yearly recurring onetime projects that tend to execute in those periods.

4:19 We continue to retain wallet share with our top customers. We added one new enterprise account in the quarter and renewed a three year contract with a leading PSU bank for fulfillment solutions offering. We also renewed a three year contract with a leading PSU life insurer, securing a significant share of the business. IoT solutions IoT solutions revenue grew 45.6% year on year to rupees 551,900,000. Sequentially, revenue moderated from a high q one base, reflecting retail sector seasonality and the normalization of volumes following a large retail customer migration, which happened in q one.

5:08 RFID continues to present significant long term growth opportunities across retail, logistics, pharmaceutical, and manufacturing, driven by increasing adoption of traceability and automation solutions. We are strengthening system integrated partnerships to develop differentiated end to end solutions, integrating hardware, software, and data intelligence. In parallel, product qualification underway for SIM card supplies to other large telecom operator. We remain optimistic about the long term growth potential across RFID, IoT and BLE based flexibility, SIM and eSIM solutions. The external environment continue to be challenging with the USD iron ore remaining elevated, higher fuel prices having its impact on logistics and put material costs.

6:02 Cost of materials, therefore, increased faster than revenue on a year on year basis. Sequential revenue growth with a better product mix outpaced the increase in material costs, driving an 89 bps improvement in gross margin to 42.5%. We remain focused on diversified sourcing, calibrated inventory planning, localization, and procurement discipline. The contribution from our top 10 customers was 57%, reflecting a well diversified portfolio while retaining deep relationship with large clients. Our sustained focus on r and d, product innovation, and continuous technological advancement is deeply embedded in our organizational culture.

6:48 This commitment is reflected in our growing intellectual property portfolio. During the quarter, we filed two new patent applications, taking a cumulative filings across products and solutions to 21, of which five have been granted. Our subsidiary, Atul Solution, also filed for four new patent applications this quarter, bringing its cumulative filings to seven, out of which two have been granted. These milestones reflect our ongoing efforts to develop differentiated solutions and strengthen our technology led competitive advantage. As we look ahead, our focus remains on strengthening our core business while building new avenues for sustainable growth. Our diversified portfolio, long standing customer relationships, strong execution capabilities and continued investments in technology position us well to navigate evolving market conditions and capitalize on emerging opportunities.

7:48 Our priorities remain clear, deepen our wallet share with existing customers, scale our premium and metal card offerings, strengthen our IoT portfolio across RFID, SIM and E SIM solutions, and export... Expand our export business. We will continue to invest in r and d innovation, manufacturing capability, and strategic partnerships to develop differentiated, higher value added solutions for our customers. Alongside these initiatives, we remain committed to operational excellence, improving efficiencies, and disciplined execution with a clear focus on long term value creation. Thank you for your continued trust and support. We look forward to updating you on our progress in the coming quarters.

8:35 With that, I will now request Pawan to take you through the financial and operational highlights for the quarter. Over to you, Pawan. Thank you, Pranayat, sir. Good day, everyone, and thank you for joining our Q2 and H1 FY 'twenty seven earnings call. Let me begin with a summary of our consolidated financial performance. In q two FY twenty seven, revenue from operations increased to 4,053,100,000, representing a growth of 15% year on year and 7.7% sequentially. Total income was 4,112,500,000, up 16.4% year on year and 7.2% sequentially.

9:22 Gross profit was 1,724,400,000 with the gross margin at 42.5%. Gross margin improved by 89 bps sequentially due to operating leverage and a favorable product mix. It remained three thirty one basis points lower year on year, primarily due to the elevated USD INR and the geopolitical situation and its related impact on input costs. EBITDA increased 12% year on year and 12.9% sequentially to 1,065,600,000. EBITDA margin was 26.3%, an improvement of one twenty one bps over q one FY twenty seven.

10:10 Operating EBITDA, that is excluding other income, was 1,006,200,000 with a margin of 24.8%. Operating EBITDA grew by 7% year on year and 15.2% sequentially, demonstrating improved operating leverage during the quarter. Finance costs declined by 74.9% year on year, reflecting the benefit of debt repayment. Profit after tax increased by 21% year on year and 15.6% sequentially to 697,300,000. PAT margin improved to 17.2%. For h one FY twenty seven, revenue from operations was 7,817,800,000.

11:01 EBITDA was 2,009,700,000, and profit after tax was 1,300,700,000. EBITDA margin for the half year was 25.7%, while PAT margin was 16.6%. Our balance sheet remains strong. Cash and liquid investments were 3,144 million As of the end of q two, unutilized IPO proceeds were 1,196,100,000. Cumulative utilization was 4,803,900,000, including 849,200,000 towards capital expenditure, 3,000 million towards repayment of borrowings, 343,700,000 towards issue expenses, and 611,000,000 towards general corporate purposes.

11:58 Overall, q two FY twenty seven delivered healthy growth, a sequential recovery in margins and a stronger cash conversion outcome. We will continue to invest for growth while maintaining financial discipline. Thank you once again for joining us. With this, I hand it back to the moderator to open the floor for the q and a session. Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and then 1 on their touch tone phone. If you wish to remove yourself from the question queue, you may press star and then 2. Participants are requested to use handsets while asking a question.

12:44 Ladies and gentlemen, we will wait for a moment while the question queue assembles. Again, to register for a question, you may press star and then 1. Your first question comes from the line of Aditya with Aventispark. Please go ahead. Hi, sir. Am I audible? Yes. You're audible. Go ahead. Hi. Of all, congratulation on your excellent set of numbers, sir. My first question is on the payment solution segment. We have shown a tremendous growth in our payment solution business quarterly quarterly and also year on year. Could you throw some light on where directionally has the growth came from, whether on the debit card segment or the credit card segment?

13:38 And also, could you elaborate more on our export business? Like, give me... Give us some insights because we specifically mentioned that also has contributed to our revenue growth. Could you give us a broad overview on that too? Yeah. Yeah. See, this is the revenue accomplished on the payment solutions in this quarter had some project volumes where we had done some projects for the mass transit programs. And, also, I think we had some good volumes from the debit card side. On the credit card side, we, you know, we've kind of... In in that quarter, if you see, we've had couple of customers where the volumes have done well. But, overall, I would say the major contributors would have been the mass transit program and the debit card.

14:27 On the export side, we've done exports to Europe and Africa. So it began in the first quarter, and it picked up the second quarter. Also, in this quarter, we were happy to know that our metal card volumes picked up. So we had done some very good volumes of metal card compared to the previous quarter. So net debt, I would say three or four factors. One is the general uptake in the debit and credit card from the customers. Second is this one of programs that we're doing, which which, again, is gonna be sustained over quite some time in the foreseeable future for mass transit programs. Third is this metal card update, and fourth is the export of cards that we're doing. To answer your question specifically on exports, what we've been doing is we've been building channel partners and, essentially, first relation bureaus and other geographies who would want the cards to be taken from us. And, typically, these are premium cards and metal cards that these customers want. And probably, we've got, you know, good visibility of things to sustain over some time next quarter, like, business.

15:38 Thank you, sir. My next question is on the IoT segment. We have shown a tremendous year on year growth on IoT segment and that's, moderation in our quarter on quarter. I would like to know how we can track this segment assets considering we have entered into this business recently and we are showing tremendous growth on this. Could you give me some insights on whether we have to track this segment on a quarter on quarter basis or year on year basis, like as a whole, how to track this particular segment? I would like to know. It's a very good question,. See, in fact, what happens is on the on the IoT business, if you look at the construct, right now, the major contributors in the IoT business is coming from the RFID tag business, and the SIM business is just beginning to contribute towards it. Right? So if you look at it from a year on year basis, if you look at it on h one twenty six to h one twenty seven, we still grown at about 45% year on year. Okay?

16:33 It... What... Especially the retail business, if you see retail business has its own demands because they prepare for the festive seasons. So, typically, you know, the the q one seasonality pattern is such that maybe the preparation for the special season is such that the q one volumes are slightly higher than q two. And then, again, they pick up in q three, q four. And, also, I think when our SIM business will pick up, it also depends on how we can onboard with the customers and start building up volumes with them. So I think if this this whole seasonality on the retail business is something which is which is common to market, which will, I think, repeat year on year. So maybe we... At the end of the year, we again expect ourselves to grow with the outlook and target reset for ourselves that I think in FY '27, we should be again going over on a year on year basis at 45% of the revenue of FY twenty six.

17:31 Right, sir. Thank you so much, sir. Again, congratulation on your awesome set of numbers. Thank you. Thank you. Your next question comes from the line of, an individual investor. Please go ahead. Sir, good evening, and congratulations on a very steady set of numbers in a difficult kind of a market. Sir, generally, Seshaasai, the h two has been better than the h one. Do you foresee that con... That trend continuing in the current year also, sir? Yeah. So, see, basically, that is... We normally expect a better traction in h two, which is a pattern of our business.

18:20 However, we'll just keep one thing in mind that last year, our q one numbers were slightly on the lower side, and hence, the h one, h two difference was slightly more amplified. Right? So, I mean, if you look at that current business pipeline, we have, you know, support for the customers in terms of the card volumes. We also are having good visibility on the on the premium and metal cards that we are executing for customers. The transit program that we are doing continue to be executed through h two. And we're also having some engagements and expect some volume ramp up in our IoT business through the same business. Right? So I would say that, you know, we will... We continue to maintain the the expectation that h two would be better than h one.

19:07 It has to be seen how it plays out, you know, once all these variables are are in place. But as a pattern, one would expect that to continue. Sir, and what what is your take on the input prices, sir? I think there is there is input price pressure. So are you able to pass it on, or do you see it easing in the next few quarters, sir? So, essentially, here, I would say the the dollar impact is something which which is, you know, which is very important for us. We also have related input cost hikes on the kind of logistics and the and the input related to petrochemicals. So in certain customer cases, we have been able to pass on the price hikes to them.

19:57 In some... Certain other customer contracts which are coming up for renewal, we are, you know, factoring that in our revised proposal being new to the customers. So I would say... I mean, if you look at the... In power statement, opening statement, if you look at the reduction in in our gross margins, right, It's reflecting there. So what we're also trying to do is see how is it that we can improve our product mix to add more products which are high margin contributors, you know, keep our ship very tight and lean so that we are able to have more operating efficiencies. So I would say, in all fairness, this is a factor which is not in our control. So while we are trying to minimize and mitigate the impact of that by, you know, handling our inventory and our supply chain more tightly.

20:48 We're trying to look at it more from what factors under our controls, such as our product mix, you know, and also seeing how is it that we can go back to customers where possible for price checks or factoring it in our revision of contracts with customers. And, sir, slightly on on a macro level, the the changes in MDR, does it affect our touch status by at all, or we are unaffected by it? It's a very good question. See, I hope it comes through. Okay. You're talking about MDR related to UPI. Right? Yes, sir. Okay. Okay. So I think right now, UPI, obviously, is a very convenient mode of payment, But I think a very big attraction towards such a large, you know, usage of UPI has obviously been the zero MDR. Right? And, you know, if if the kind of fees for the high value transactions or or certain chargeable transactions comes in as and when it comes in, people expect that the delta differential incentive between using a card and phone pay will get a little blunted.

22:07 So, you know, now it's it's a factor where the consumer behavior is gonna be leaning more towards convenience or more towards the, I would say, you know, the financial as... Implication is to be seen. But, I mean, let let that factor to the factor which obviously has a bias in our favor if comes in in terms of, you know, the the It it is it is a variable project. Right? Yes. Yes. Yes. Yeah. And, sir, any any plans for the cash on books? What would be the cash on books, and what are the near term plans for it, sir? Good evening. This is Pawan here. Hello? Yes, Pawanji. Good evening. Yes. So we we have a cash and cash equivalent of close to about 3,144 million and a net net cash of about 2,407 million.

23:06 So right now, it's in a mix of bank deposits, etcetera, which is including our unutilized IPO funds of close to 120 crores. What we are doing is through the year, there have been consistent investments in infrastructure as well as equipments, which we have done, and we are continuing to do that through the year across our business verticals. So we see that continuing while ensuring that we are able to manage our overall cash flows and working capital as well. Sir, thank you, and best best wishes for the year. Thank you. Thank you. Before we take the next question, a reminder to all the participants, you may press star and then 1 to ask a question.

23:57 Once again, to register for a question, you may press star and then 1. Your next question comes from the line of Devesh Agarwal with IIFL Capital. Please go ahead. Good evening, sir, and thank you for the opportunity. Firstly, congratulations on good set of numbers. So my first question would be on the payment solution business. If you can give us a broad idea in terms of how much of your revenues were from the, I would say, the traditional business or the core business, how much was from this onetime mass funded program that you mentioned? And how much is from your new initiative, which is exports and basically the metal cards? So while... Hello,. I think...

24:54 I mean, we would probably... The export revenue here of the overall revenue in in h '1 is close to about 5% of the total, you know, payment card business. Right? On the on the metal cards and the mass transit, I would probably refrain from giving the details on the mass transit. But, you know, the master on it is is a volume segment which is going up. We've got three programs running right now on that. But that's a program which is showing good promise for for the future. Right, sir. And, sir, going forward, maybe if you can take a little longer term view, two, three years, do you think the growth in this segment will largely be driven by the exports and the metals or the core business plastic business is also growing equally fast?

25:45 Or I would say there is one more aspect to it, Devesh, which is also within the existing plastic business. There is a sustainability and a premiumization part which is coming in. So a lot of customers are requiring recycled PVC on the existing plastic base. A lot of customers are also wanting better embellishment and finish on the card, which adds to the value to the existing plastic card itself. And and also the entire unboxing experience in terms of the the the packaging, and we're also going one mile ahead to also offer the logistic solution where we actually increase the the realization of revenue per lane ship or per card delivered. So our focus in the coming time is that on the existing base card itself, how much more value can we add there in terms of the card value and the value added services we can do on top of it for the existing base. So that's one part of the thing, and then there is a premiumization part linked to it.

26:40 Definitely, we feel the time has come in our markets for the metal card volumes to pick up. And exactly for that, we are setting up the new facility, which should be operational very soon where we are almost tripling our... You know, three times the current metal car capacity, which we are trying to keep ourselves ready in time such that when the market demand picks up, we are ready for execution. And we're also having a couple of overseas customers that we're in talks with. So metal, for sure, you know, is... What is also an important driver. And it'll be... I mean, good for you to know that the metal card quality of the products that we produce in India also has been very well received by international customers.

27:25 So the quality of the product is really, I would say, benchmark to the best in the world. So that sets us very well in this platform for good metal card opportunities going forward. So net debt, I would say it's a mix of of probably, you know, the product mix in the current portfolio that we have and also the metal card business. On the export side, our strategy is to work with system integrator partners and also work with large direct consumer of cards, you know, to see how is it that we can reach... Or tap into that market, which obviously will be only for, you know, niche products that we are focusing on right now. And, sir, this export market is largely the plastic... For the plastic or metal as well?

28:15 Yes. So right now, we'll be doing it for some premium plastics. There are discussions on the customers for metal. So we are right now only sampling in the qualification stage right now for metal. Sure. And the markets you mentioned were Africa and? Africa and Europe right now. Europe. Okay. Yes. Yeah. And, sir, on the IoT business, you said migration of a large customer. Could you share some more details around it? No. So the question was, Devi, that, I mean, I think that our Q2 number and Q1 number... Basically, there was a little bit of a moderation in the Q2 number. So in Q1, we had typically a a customer who was getting onboarded. So what happens when when a new brand comes into the IoT RFID program, right, there are two...

29:06 What I would say, two... It's a two pronged approach that they take. So one is all new merchandise which are produced from the factories. Those essentially are supplied by RFID tags, and they come retagged from the factory with RFID tags. But, also, at that point in time, the brand would have a lot of stock lying in its warehouse and lot of material lying in the stores. So what happens is at that point in time, whatever is your legacy inventory lying at various stages of your supply chain, they also have to be made smart, and they also have to be tagged because they are sitting on legacy non RFID tags. So what happens is that when a program begins, during the transition migration phase, you have one bulk requirement which comes in for tagging of all this inventory lying in the supply chain.

29:58 And then you have business as usual, which is your new procurement where you're supplying to the factory, and it gets tagged. So what I was just trying to explain to to the questioner was that in q one of this year, we had one large brand whose program was picking up. And at that point in time, we had some bulk volumes where the existing inventory was also being tagged. So their existing inventory tagging is once in the lifetime of project takeoff. Right? Then it is always inventory and business as usual. So you probably... So, I mean, that's a good thing for us that whenever we have a new customer coming in, we will always have this one upside where we have one large chunk of existing inventory being tagged, and then you start doing business as usual. So this was one such situation where in q one, we were in the midst of this migration exercise.

30:50 Understood, sir. And, sir, retail used to be the biggest customer as a sector for us, but we were also trying for some of the other sectors to use the RFID technology. Have we made any headway in any of the other sectors? Yes. Good question. See, retail continues to be the driver, you know, for that. We've done done some good work. We continue to do good work in the renewal school space. Okay. We continue to have a product well accepted in that space. There are some customers that we're working on also in the eyewear space. So we began some work with some large brands in the eyewear space. There are some pilots also happening with large brands in the FMCG space, and we're we're also doing some pilots with customers in pharma.

31:40 So... Whereas in the eye care space and the nonrenewable space, we already have begun revenue for the past few months in in in pharmaceutical, in in jewelry, and in in... Yeah. So in these two, three sectors, we are doing POCs with customers and, you know, getting the product and solution evaluated. Right, sir. And so my final questions would be on the margins. You did mention that on a Y o Y basis, there has been a decline. We understand that rupee kind of rupee depreciation hurts you and even there is a cost inflation in terms of possibly the raw material imports.

32:29 But does the 2Q number reflect your spot cost or the spot cost will be higher than the 2Q? And to that extent, there will be further pressure in the 3Q margins? I would say what has happened is that ever since the war began in in February, March, we we decided to actually hold a larger inventory for two reasons. One was we thought that we'll have gradually, you know, insulating us from any supply chain shocks. The flip side of that, which also became an advantage of sorts was that as the rupee was climbing, we were having inventories held up at various levels of the rupee. So to my mind, know, inventories which have been consumed in q two, you know, all the input costs in q two, pretty much to a to a great extent, almost are at the normalized level of the rupee at as... At this stage.

33:24 Maybe to my mind, you know, q three could better reflect the the actual numbers, you know, which which would probably be things which are in current and state. Yeah. But, overall, I would say q two should not be very far away from the normal situation. Understood, sir. Thank you so much, and all the very best, and wish everyone a very happy Diwali. Thank you. Thank you. You. Before we take the next question, a reminder to all the participants, if you wish to register for a question, you may press star and then one now. Your next question comes from the line of Pratik Pantia with Formi three twenty five Investment Advisors. Please go ahead. Good evening. Congratulations on a strong set of numbers.

34:12 I only had two small... A couple of questions, primarily bookkeeping in nature. The first one is when we see a a little inventory buildup during this quarter... During this half of the year, I just wanted to know, is it due to some seasonality wherein before the festive season kicks in, we have stocked up for our our IoT business, or is it that you're seeing a little volatility in the future and you wanted to stock up on some chips or anything like that, like you've done before as an opportunity? So, Pradeep, the the seasonality, as I explained earlier, especially the IoT business, the seasonality execution typically gets over by, you know, maybe maybe July, August, September.

35:03 You know? So so, typically, the inventory here right now probably would be, as as I explained earlier, what we are expecting maybe because of the semiconductor situation in the AI boom, you've seen the memory chip prices going up. So what's happening in our segments is that the lead times have been very, very high for semiconductor supplies. And we always see that come December, right, from second half of December to first half of January, because of the holiday season and all of that, there is very high unreliability in the supply chain. And we've always seen that that period from, say, third, fourth week of December till the end of January, you know, you you cannot very much rely on on supply chain, whereas it's also shut down for holidays, etcetera. So this is something which was, you know, done keeping in mind the, you know, the the the q three requirements that we have.

36:00 As also keeping in mind the fact that some of it is also a new vertical that we're beginning is for our SIM card supplies. So couple of our customers have couple of variants of products that we consume. We're still not gonna grip of their consuming pattern. So we wanna be agile in terms of being able to get larger market share from them. So we're also invent pricing of the whole variety of chips that they would need for their consumption. So, you know, that's that's that's where we are. But, you know, we probably once... As this year passes by, the endeavor is if things normalize, at least to some degree where we have greater clarity, the endeavor is to probably rationalize this as we go. But but what we said, what was that It's very important for us to ensure that if the inventor becomes an enabler for us to get greater market share and greater resilience to customer service, then probably it's better to work on the side of caution than, you know, be a little conservative there.

37:04 Okay. Thanks so much,. Last question would be, could you share, you know, the utilization for your SIM card business? And have you started with for our eSIM products? Yeah. So on the SIM card business, I think this month, we're running well. This month, next month, we should be close towards 70, 25% of our capacity utilization. Okay? On the ECM side, the process involves qualification and integration with the with the telcos. So I think we've in the post of finishing our qualification work around the telcos. As per our original plan as well, we've not factored any revenue of eSIM in part of our business plan for this year, but I think we hope to at least begin something by the turn of the year. And we've got good prospects lined up for the next financial year. So by which time our integration qualification...

38:06 Because the eSIM business, The the customer actually ends up testing the the module on his own end. So if it is electronic meter or it is EV or it is a circuit board of an appliance, it has to be integrated into that. The customer does the testing and the qualification, and then your business starts. So the the qualification cycle is slightly longer, but once you're in, then, you know, it's slightly more secure. So we hope to finish at least this process in the next six months for a couple of our customers to set the platform for revenue for next year. Okay. And last question, just a little clarification from my understanding. So these EC modules that we produce, they are for smart connected vehicles, smart meter, etcetera.

38:54 Is there a possibility of the same module going into mobile phones as well, or those are a different kind of module? No. So it's a good question. The eSIM secure component which goes into mobiles is the same. Okay? But the unfortunate part is that the the volumes are so large that these mobile players have global partnership with some global suppliers. But the answer is the eSIM component is the same. It's just the manifestation is different. It's called a secure element. The manifestation is different on different use cases. The hardware is pretty much the same. So I probably at a larger... If we get to a larger scale, probably we could end up supplying some part of it. Is that to plan in the future or not at this point?

39:44 Too early to comment, Pradeep. We are just taking our baby steps here. Got it. You know, we'll kind of take it as it comes. But as you rightly said, the opportunity, you know, especially in utility services, you know, electric meters, water meters, gas meters,. So let us actually... Just kind of take the situation as it unfolds over time. Okay. Thank you so much, Ananda. Thank you. Participants, if you wish to ask a question, you may press star and then 1 now. Once again, to register for a question, please press star and Participants to ask a question, you may press star and then 1.

40:56 As there are no further questions from participants, I now hand the conference back to the management for closing comments. Over to you, sir. It has been a pleasure interacting with all of you today. Q two demonstrated healthy growth, sequential margin recovery, strong progress in payment solutions, while IoT continued to grow meaningfully year on year. We appreciate your continued trust and support. Thank you. Thank you once again for joining us today. We appreciate your participation and look forward to updating you next quarter. Thank you. Ladies and gentlemen, on behalf of Seshaasai Technologies Limited, that concludes this conference. Thank you, everyone, for joining us, and you may now disconnect your lines. Thank you.