I now hand the conference over to Mr. Nikhil Choudhary from Nuvama Wealth Management. Thank you, and over to you, sir.
Thank you, Siddhant. Good morning, everyone. On behalf of Nuvama, I welcome you all to CMS Info Systems Q1 2025 earnings call. We have with us today the management of CMS Info Systems, Mr. Rajiv Kaul, Vice Chairman, whole-time director and CEO of the company. Mr. Pankaj Khandelwal, Chief Financial Officer. Mr. Anush Raghavan, President, Cash Logistics Business. I now hand over the call to Mr. Rajiv Kaul for his opening remark, and post which we can open the floor for Q&A. Over to you, Rajiv.
Thank you, Nikhil. Good afternoon, everyone. Thank you for attending our Q1 FY 2025 call. I'm happy to report another strong quarter of 17% revenue growth and adjusted PAT growth of 13%. Q1 usually has a seasonality impact, which this time got further impacted by a fairly long election cycle, which has impacted cash velocity in several large states. Despite this, we have maintained momentum on our touchpoint additions in our cash logistics business, where we added 3,000 points in Q1, and we totally now have 140,000 points. In our managed services and tech business, our order book wins for the quarter were at, were fairly robust at INR 200 crore.
We are investing fairly aggressively in developing our AIoT RMS tech stack, and I'm very happy to report that we had a large win, which is sort of a first-of-its-kind RMS project at a leading bank. This is a sort of a unified build-and-operate mandate for integrated surveillance transformation project across 2,000 locations for this bank. And the solution is gonna include a 24/7 centralized on-prem command and control center, which will need to converge with the bank's tech stack and will also involve us developing 10+ new AI and ML modules. With this, I will hand over to our CFO, Pankaj, to take you through our Q1 financial highlights.
Thank you, Rajiv. Our consolidated revenue has grown 17% to INR 599 crores, led by strong growth in managed services and technology solution businesses. Adjusted PAT has grown by 13% to INR 98.5 crores, and adjusted PAT margin stood at 16.4%. Business-wise, cash logistics business has grown by a steady 10% year-on-year to INR 387 crores in Q1, with an EBIT growth of 6% to INR 99 crores. Our MS and tech solution business revenue grew strong at 31% year-on-year to INR 239 crores. The EBIT in this segment has grown 20% year-on-year to INR 41 crore, and the EBIT margin stood at 17%. The execution of order book, which we won last year, is on track, and we estimate majority of these go live in next six months.
With this, I would like to hand over to Rajiv for his closing remarks.
As we have reiterated before, our growth of our company is linked to three macro themes. The first is formalization, where we are seeing positive trends which are leading to a strong growth in our retail business. The second is around consumption. Consumption was slightly subdued in Q1, which seems to be a cross-sector theme, but we expect it to improve in Q2 and Q3, with the festive season. And third, which is more near term and directly impacts us around the BFSI and banking outsourcing theme. I think the successful IoT, AIoT RMS win demonstrates the opportunities which exist for companies like us in integrated outsourcing projects.
If you look back at last year, the majority of the projects for the 40,000-50,000 ATMs which are awarded, they should get executed by the ecosystem and industry in the remainder of the FY 2025. There also has been a fair amount of discussion on the ATM interchange for both bank-owned ATMs as well as white label ATMs, and we await a positive policy decision in the coming months. Some of the large bank RFPs of BLA ATMs, which hadn't concluded successfully because the discovered price was higher than interchange, I think will get an impetus and hopefully will move forward to closure if the interchange increases. And if this interchange increase happens, I think that will give the impetus to the ATM growth and also drive higher outsourcing in that channel.
To summarize at the close, we are reasonably confident of achieving our FY 2025 revenue guidance of INR 2,600 crore-INR 2,800 crore, which should translate to a growth of 15%-19% for the year. Q1 at 17% is bang in the middle of this growth. Thank you, and we can move to questions.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Divyanshu Mahawar from Dalal & Broacha Stock Broking Private Limited. Please go ahead.
Thanks for the opportunity, sir. And I wanted just to know about, in last FY 2024 annual report, if you look at, I mean, cash flow, there is, some, element called as bad debt and provision for bad debts also. It is amounting about INR 90 crore, and last year it was something called INR 98 crore. So how do you look this, and what actually it tells us? Because every year we are looking that this amount is around INR 80 crore-INR 90 crore we are writing off. So what, what now going forward, it should reduce or it should be same as it is there?
Okay. So just before we answer the specific question, this is Rajiv, I just want to, you know, we did a fairly exhaustive FY 2024 end of year call exactly two months ago, where we had a detailed presentation, lots of Q&A. For anyone who's new to these calls, I would sincerely request you to please go through that Q&A. It will help solve, answer a lot of our questions. Nothing dramatically has changed in our answers or life in the last two months. Coming specifically to the risk cost and the provisioning, I think, we have guided, I mean, what our guidance we have said, I think we have said that, this number was roughly 5.1% in FY 2023, and we have said that this should be around the 4-4.5% in FY 2024.
This is a number which you can't forecast with any accuracy in the future. Therefore, we hope to work hard to make sure that our product provisions remain in that range in the coming years.
So is it right to assume that the implementation of cassette swap will reduce this provisioning?
Yeah. Okay. I mean, see, look at our business. Our business is fairly complex. cassette swap doesn't, isn't 100% of our revenue, right? There are many service lines. In the revenue lines where we are linked to ATMs and cash flows, a cassette swap will lead to reductions. We have seen the reductions. Actually, if you see the trend line for FY 2023, 2024, we've already seen a reduction. Will this number be zero? No, never.
Okay, sir. Sir, last question is that can you give us an update on the bullion management that we are coming? So what is an update on that? Is it we are going to launch it this year or somewhat? Any sort of update?
I would recommend you to listen to our FY 2024 end of the year call. I think we have talked about the facts and incubation, and we look to grow it. It's a very small business right now. We are incubating it internally. If there is anything material which changes from our growth strategy or M&A, we will come and update you.
Okay. No problem. Thank you, sir.
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants, please limit your questions to two per participant. The next question is on the line of Nihal Shah from Prudent Broking. Please go ahead.
Hello. Am I audible? Hello? Hello.
Yeah, we can hear you. Please go ahead.
Yeah. So, my question was about the margins in managed services. So it has come down from around 18.6% to 17.1%. So for cash management business, I can understand that this year, the active, this quarter, the activities were low because of elections and also there, the economies of scale would not have been paid out. But, what was the reason for lower margins in managed services?
Yeah. So given the EBIT growth of the MS business is around 20%. As you might be aware that we are relatively new entrant in the managed services business, which we have mostly incubated internally and scaled to INR 800 crores in FY 2024. This is a large span, and we'll try to balance growth and margin. The change in the business mix can impact the quarterly margin, but we continue to deliver higher margins, like our overall PAT is around 16.4%, which is a world class, and we continue to have a ROC, which is 25%+.
Okay. Another question was regarding the mix in revenue of managed services, as I guess, reached our target of around 35%-40%. So will it go to 50/50 till FY 2027, or we think it'll be stable at this 60/40 kind of a juncture?
Well, it's impossible to forecast this right now. I think we won't know FY 2027. We haven't given any guidance on FY 2027. We have given FY 2025 guidance on, revenue range and also the mix. We had expected to reach, 40% revenue contribution from MS and tech by FY 2025. FY 2024 end, we are at 39%. We think we'll be at the 40% range now, ±2-3%, very difficult to forecast right now. But FY 2027, it's too early, we won't be able to give you that, we won't be able to give an idea on that.
Okay. And so the AIoT business, there we won order of around INR 200 crore. Is that understanding correct?
No, we said our overall order wins in the MS and tech business are INR 200 crores.
Oh, okay. Okay, sir. Thank you. Thank you for the clarification.
Thank you. Ladies and gentlemen, before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is on the line of Ankit Kanodia from Smart Sync Services. Please go ahead.
Thank you for taking my question, and congratulations on good set of numbers despite the usually weak quarter. So my question is basically related to so as we see that the growth is clearly visible in the managed services and tech solutions, and we have ramped up the sales there significantly over the last few quarters and maybe a couple of years as well. But when I talk about cash logistics, and even in cash logistics, if I only talk about retail cash management, I would be really happy if you can share more details as to how do we see us going forward in this particular domain, and what is the competitive intensity here from a 2-, 3-, or 5-year perspective, how do we see ourselves in this business? That would be very helpful, sir.
.Okay. Hi, Anush. I think as we've, you know, shared in some of our, details already, I think our overall growth profile in the retail continues to be, is very strong. We have some good tailwind and momentum there. A lot of that has come on the back of investing significantly in technology and creating a very strong sales team to focus on expanding the overall market. I think as we alluded to you in our previous call as well, out of the, business point additions last year, a majority of them were from our retail cash management business. And I think we continue on that, right? When you see our first quarter, we've added, three thousand business points. So, in terms of where that business is going and how the growth prospects are, they continue to be very strong.
Right now, I can't speak too much about the competitive intensity because I think what we are trying to do and create here is a very different and a unique, different approach. Creating an ecosystem and partnerships ranging across, you know, fintech, payment banks, and, like I said, we are sort of trying to broaden and create a much larger market opportunity than what exists today.
I mean, this is a market where we have been, you know, CMS has been a pioneer in the retail side of the market, long ago, and I think we are driving fairly aggressive growth and market share focus in the business. But, what is important is that this market growth, we see a lot of momentum in the market, in formalization, as I talked about.
The retail sector seems to be overall buoyant in terms of investment to expand number of outlets and stores. We are looking to see how we can expand the overall market size, instead of just competing in the market we've been competing in.
Right. Just a follow-up on this, sir. If my understanding is correct, all these retail touchpoints, we are generally covering it through our partnership with banks and NBFCs, right? But do we also have any plans on taking to this market directly to our end consumers and not going through just banks and NBFCs? Do we have anything on those plans?
Yeah, I think without getting too technical into the operational aspects, I think what I mean to say when we are talking about partnerships is, see, end of the day, we are a cash management company and a technology service provider. We are not a payments company ourselves, and we can't be doing settlement directly. The way we are looking at growing this market is creating a large sales team and creating a technology with multiple APIs, which can integrate with retail. And the settlement of that will happen through partner banks and partner NBFCs. But as far as the relationship is concerned, in many cases, we would be sort of fronting and helping expand that.
Sir, maybe I'll rephrase my question. What I meant was not about settlements, but I was talking about the cash pickups and all those, activities. Right now, all these activities are done through our contracts with banks and NBFCs.
No, no, all of them are not. No, they're not all done through banks. Some of them are direct, some of them are through banks. I think the proportion will change over time, depending on. You know, again, I think what we try to deliver is a solution set, to depending on the retailer's needs. Banks would always be involved as a sort of a payment mechanism or for a settler. I don't think there is a.
But the sales effort has changed over the last year, year and a half, to directly be able to understand customer needs at the retail, individual retail company level, and then to customize a solution, which also includes a cash pickup service, right? There are other things which people need, which we work on. Got it. Thank you. I'm sure you would have looked at our presentation at the end of Q4. I think Anush explained this in detail. Beyond that, I think will not be right from a competitive perspective.
Yeah. Thank you so much, and all the best.
Thank you. The next question is from the line of Yashodhan Nerurkar from Edelweiss Mutual Fund. Please go ahead.
Yeah, hi. Thank you for the opportunity. So just wanted to understand, so basically, you started off with providing touchpoints for the bank, and now you're seeing an opportunity on the retail side as well. And as we continue, there's bullion and, you know, some other things as you mentioned earlier. So just wanted to understand from a profitability perspective, how do you measure. Because it's, it's based on a trip, right? Like a round trip. So from a round trip, if I have to understand the profitability, say, for a retail side and a bank side, so how different would they be? And what are the different metrics that you use to evaluate that?
I think, you know, we have, we may not have engaged so much earlier with you, but, just our, our routes are fungible, right? Our routes are fungible for an activity. It could be an ATM loading activity, or it could be a retail cash pickup, or it could be something else. So I think it's very difficult to figure out profitability by each individual line item. But again, my point is the businesses which have been established over a long period of time will have higher profitability. Newer businesses, where we are driving high growth and high market share, will be less profitable.
Okay. Okay. And my second question was about, earlier you had mentioned that you'll be partnering with new banks, and you'll be adding few more touchpoints. So how is that progress coming along? And are there any new, banks which have partnered with us? And it's okay if you don't name them, but just wanted to know the incremental, logos that you have won.
Sure. I think, again, we've shared a lot more data and details on this in our annual update, and we'll continue to do that in that, cadence. But, you know, we've been in this business for 20-25 years. I think we work with almost every single bank in the country. I think when you're talking about partnerships and expansion, this is more about trying to expand the solution set. What used to be a plain vanilla logistic service of cash pickup, I think we are sort of significantly seeing a transformation. As we work closer with retail and we engage directly with them, I think we understand far better the needs, especially through technology and automation, where we can bring in greater efficiency, better controls, and better risk management. All of that CMS cannot be doing alone.
We have a role to play as acting as an integrator in this space, but there is also value that a fintech or payment banks can do in terms of bringing their capabilities and their skill sets, and I think that's the partnership that we're looking for. I think as I alluded to last time, we have more than 35-40 different logos and retailers with whom we are working directly as we speak.
Okay, so this includes banks as well as retail, if I'm not wrong?
Yeah.
Okay. Yeah, so that's it from my side. If there are any questions, I'll join back in the queue.
Thank you. Participants who wish to ask questions may please press Star and One at this time. Next question is from the line of Abhishek Singhal from Naredi Investments. Please go ahead.
Yeah, good afternoon, sir, and thank you for the in-person. So my first question was, how much cash loss, cash loss due to in terms of this time recover from insurance company in Q1 FY25 and FY24? And how much time does it take to recover money from the insurance company? This is my first question.
Do you want to finish all your questions, then we can answer them?
Yeah. Second question, how much bad debt write-off in Q1 FY25? That's all.
I mean, so I don't think we have any data on Q1 basis. These are numbers which are reconciled end of the year. We have given a half yearly, sorry, half year and full year. That's the number where we are able to provide you on bad debt provisioning, losses, and all that information. From the perspective of insurance, I think that's a very. I don't think there's any track record we can tell you how long it will take. It's a case-to-case specific. We've been in this business for 20 years.
I think it's a part and parcel of our business to be able to get a right insurance policy cover for our risk, and in case there are any bad incidents which happen, recover the money either from, you know, working with the police and investigation authorities or with insurance. All the exact details are part of our annual report. I think that's why if you read our annual report, you will have all the detailed information for the full year 2024.
Okay, sir. I understand. I need that number. What is our risk cost for FY 2024?
Which cost?
Risk cost.
Roughly about 4%.
Okay, thank you.
Thank you. Next question is from the line of Franklin Moraes from Equentis Wealth Advisory. Please go ahead.
Yes, so thanks for taking my question. So firstly, we have adjusted PAT margins of about 16.5%. So are we likely to, you know, maintain the PAT margins at these levels?
We have never given a PAT margin guidance. I think our only guidance since we have listed has been on revenue and revenue targets. Very difficult to guess what PAT margins and costs will be in the coming years.
Okay, okay. So in terms of our ESOP costs, I believe we are at INR 10 crore. And you did mention that this, in the last quarter, you did mention that maybe there would be another quarter where our ESOP costs would trend at these levels, and then it would decline to INR 8 crore, INR 4 crore-INR 6 crore, INR 4 crore, and so on. So any change in that trajectory?
Not as of now.
Okay, okay. And in terms of our FY 27, like, the last time we had given a FY 25 guidance, it was, you know, much in advance. So when can we expect an FY 27 guidance from you?
As soon as we feel reasonably confident of the guidance, we'll come back to you. But I would say in the second half of the year or at the end of FY 2025, we will. we do owe you an FY 2027 guidance. But, we will look at it at the end of the first half and see if there is any material change. Otherwise, I think end of FY 2025, we would be in a better position to do that.
Okay. And lastly, will this current mix of, you know, managed services, the revenue mix, be stable now, going forward?
I mean, are you saying will it remain 40 or go down or go up? I'm not sure. I mean, if you see the trend over the last two, three years of us reporting numbers publicly, the managed services business is overall growing at a far higher rate than our cash logistics business. So I would expect the mix to keep changing steadily. You know, it was 70/30, 65/35, it's at 61/39. I think we'll get to 60/40, and already we are there. And I think this will certainly keep changing. I don't think it will be at a 60/40, is my sense. Of course, this doesn't assume right now anything to do with any new businesses.
If we either launch them or we end up acquiring any business, that will obviously have an impact on the mix and the portion of these businesses.
Thank you. The next question is from the line of Harsh D. from Kubera Investments. Please go ahead.
Hi, thank you for the opportunity. My question is that, as the contribution business grows, are you considering changing the name of the organization to better reflect this business?
Well, we take your feedback and advice seriously. We will, we will. We have evaluated this at different parts of our journey as a company. It is something which is something we are thinking about and working on to reflect better, I mean, into the overall branding, but doesn't mean a name change or a positioning change. I don't, I can't tell you, it'll be premature. But, our team is working on how do we communicate better about the type of company we are evolving into. So, you know, your question and feedback is appreciated.
Thank you. That's it from my side.
Thank you. The next question is from the line of Neel from ValueQuest. Please go ahead.
Yeah. So I just had one question. I wanted to understand how the company is thinking in terms of BLA going forward. So, for the next 1 or 2 years, product sales in terms of absolute number, I mean, how will that directionally change for us in the next 5-10 years?
So, you know, I'll try and just. It's a good question, and let me just use this opportunity to summarize what we have said at all stages. The BLA business is, you know, it's named BLA, but has various subcomponents. We currently do roughly about 5, 5.5 thousand ATMs in our BLA business, which will be a market share in India of around 5%. We do think that over the coming years, a lot of banks, when they outsource and revamp their ATMs, they will move to the BLA model. We will bid for those wherever we are feeling confident of the return profile. I think we've had a fairly decent return profile, and we'll focus on that. Increasingly, we are also seeing some banks move to a fixed-priced model instead of a transaction-linked price.
If interchange increases, depending on competitor density, I think we are generally very cautious around any capital-intensive businesses. We have also stated that as a policy, we have given a direction that we will cap our BLA-oriented businesses at 15% of our overall revenue. I think today, I don't exactly know, I can't remember offhand FY 2024, but our overall BLA business would be 13%-ish or something of our overall revenue. Out of which a reasonable part, I mean, I think 30% or so, 25-30% is likely to be linked to a fixed price model, which has got a more steady return profile than the variability which is linked to the transaction in BLA. How many ATMs do we expect to add?
Really, it depends on if we are able to win a good quality contract, we'll, you know, we would be happy to add. If we don't, we don't. Like, last year, I don't think we incrementally added many ATMs in the BLA estate at all. But I would think that, you know, we, in our mind, think about 1,000, 2,000 ATMs addition in BLA on the transaction-linked model. But if there is a fixed price, where there is a fixed, we know the price is sort of fixed and will not change and get linked to usage, I think we, I think we count that very differently.
Okay. Thanks for the broad understanding. But, if I just look at the absolute sales of product, you know, for 2024, that was somewhere around INR 375 crore, right? So now, going forward, should we expect the product sales to be, product sales grow to be faster than our, company revenue?
It is impossible to predict product sales. It's linked to RFPs. RFPs keep getting up and down, pulled up and down, competitive intensity. Sale of product is not a, you know, pure play, product only. There's linked to also some services come with it. I think it is good for us if we are able to maintain a good product win rate, because it leads to services, downstream services revenue for the remainder part of the project. We've had some good wins last year, which are getting executed this year. But I think, again, you know, if I take this opportunity to remind people, because some of you are new to us, right from IPO time, we have been telling, we've been trying to. It's not a guidance.
We're trying to get set expectation, saying that what you call product, you know, is something around 5%-10% of our annual revenue is usually what we try to keep it at. I mean, it's not something we, we're not stopping it even more. But I think if I look at the longer-term trend, there will be some bad years, some excellent years, but 5%-10% revenue is usually where this is at.
Okay, got it. Just one clarification. You mentioned that you are going to cap your BLA business at 15% of revenue, which is about 13% currently. That is 13% of managed services or the overall revenue coming?
No, no, of the overall company revenue.
Okay. Got it. Okay, thanks another.
Thank you. The next question is from the line of Aasim from DAM Capital. Please go ahead.
Yeah, I just one question on the BLA bit. So, like you said, banks are moving to a fixed price model versus variable. I'm just curious to know what exactly is changing that the banks are doing this. Is, is it the bargaining power, is bargaining power coming to the BLA operators, given capital deployment requirements, or maybe the ATM industry is consolidating? Or do banks anticipate higher footfall than ATM going forward, and hence moving to a fixed price model?
So, you know, we are not a BLA market leader. We are not even in the top three or four. We are the wrong people to give you guidance on this. I think there are other larger companies which will, which have, whose bread and butter is BLA. Overall, the way we think of it is, I think, I think different banks have different outsourcing strategies, and they change, right? The ones which we have seen moving to a fixed price model are looking at it. You know, think of it, a bank, why does a bank put an ATM? A bank puts an ATM to automate, to reduce the traffic at a branch, and also to cut costs. So it's like a mini branch in some ways.
Ideally, when banks put up branches, they're not looking always at profitability of a branch, they're looking at customer service. Similarly, some banks are focused on customer service and customer access, and therefore, they don't necessarily want the vagaries of what a BLA model can do, where if things turn bad, then quality of service does logically get impacted. So I think they want to make sure that they have a far more stable customer experience, and therefore, and they want to have a prediction, a predictability of the cost, and therefore, they move towards that model. That's what, that's what we try and advocate to people, that putting up an ATM is part and parcel of your operating cost. It's not something where you have to think about making it a profit-generating source or something. However, every bank has a different way of looking at it, right?
So we can't argue with bank strategies. I don't think in any way ever it's going to be possible that the whatever you call, the balance of power. I mean, I'm sorry, in customers, vendors, relationship, balance of power is always with customers, right? It's never with the vendor source. I don't think anything has changed there at all.
Okay. Okay. Just, just a second one then. So most, at least from what I understand, most of the ATM deployments and other, the ATMs that are coming in with, when you are setting up a new branch itself, is there a, like a decent business case for the ATMs on site to also shift to the Brown Label ATM model?
So it is already outsourced by a majority of the private sector banks. No, sorry, there are. Your question is multilayered. Does the bank need to own the ATM at the branch? They choose to. Yes, I think it makes far more sense for them to own that asset which is sitting on their own branch. Is there any real leverage in outsourcing that to some third party? Not necessarily. I'm saying the ownership, right? There is a ownership and then the outsourcing of services, which could include maintaining-
Thank you. The next question is from the line of Kunal Sharma from SP Capital. Please go ahead.
Yeah, hi. I just wanted to check that, in FY 2024, we had a CapEx of nearly INR 99 crores, right? So are we going to maintain INR 200-odd crores as we, as you highlighted in the previous call as well for the FY 2025?
Hello? Ladies and gentlemen, the line for the management seems to be disconnected. Please hold while we reconnect. Hello.
Yeah. Can you hear us?
Yes, sir. Yes, sir.
Okay. So, if everybody can hear us, going back to the question, I think the public sector banks over time should outsource, should logically outsource the branch-owned ATMs also. There are roughly almost 100,000 such ATMs which are not outsourced for cash management. How long that takes a factor of time, but I think logically it's linked to the cost increases, and how challenging it does becomes to manage these ATMs over a period of time.
Thank you, sir. The next question is from the line of Kunal Sharma from SP Capital. Please go ahead.
Yeah. Yeah. So just wanted to check that, in the previous call, we have guided the CapEx of nearly INR 200 odd crore, right? So are you going to maintain the same for the FY 2025 as well? Because we had a INR 99 crore in the FY 2024.
No, no. We have guided to INR 300 crore for this year. We said we do INR 200 crore average for a, over a block of two, three years, because last year's-
Mm.
Pankaj, last year was INR 100 crores, roughly.
Yeah. Yeah.
So therefore, this year is likely to be the INR 300 crore range as of now.
Okay. For the entire business, right? For the cash and the-
Yeah. Yes, please.
Okay. And one more question on the. In the PPT, I have just seen that for the FY 2024 to FY 2027, that you have highlighted the new business lines. So is that the same, which is AIoT or IT, or do we have anything else to look forward in the business per se?
So, you know, we currently have seven business lines. And some of them are relatively new, so hopefully they will expand and grow at a fast pace. We've also, last year, have talked about the same presentation or the earlier presentation, talked about incubating a couple of new businesses around collection services and solutions and also around cash logistics. So that's, I think, what we refer to from in that slide which you're referring to right now.
Okay. Okay. And last one more thing. As far as the CapEx, sorry, the order book is concerned, so roughly we have nearly including to quarter one order book, so we have roughly plus INR 2,000 crore order book, right?
Yes.
Okay. Okay. And that will be reflect in the second half of FY 25?
So the order book which we won in FY 2024, the projects are all technology-oriented projects. They have their own cycle of getting tested-
Mm.
Approved, piloted, and then going live. As Pankaj, I think, talked about the fact that the majority of the orders we won in last year should go live in the next two quarters. Majority, right? It won't be 100% necessarily, but majority of them should go live the next two quarters. Therefore, the revenue will start accruing after that.
Understood. Thank you so much.
Thank you. The next question is from the line of Pranay Jain from DealWealth Capital. Please go ahead.
Yes. My question is on the retail cash solution that we are looking to launch this year. So just wanted to understand the progress on that front and what estimates do we have from this?
. business contribution over the next couple of years?
Yeah, I think just to clarify, our retail cash management is a business that we've been running for, you know, since the inception of the company. And when we talk about retail cash, it's in the context of that, where I think we are seeing some very strong tailwinds and growth. The business which we incubated and launched newly is the retail loan collection part of it, where we are helping banks with their debt management and loan collection services. And I think we had spoken a fair bit about it in our annual call, not much to update from there to now. I think we will look at incrementally different acquisitive opportunities in this space, and when we have something to report, we'll come back to you.
Okay. And also with a new CIO at the helm, what would be the clear focus areas and mandate at that end in order to add alpha to growth? Because I'm sure this has been brought in timely for the new solutions that we have been incubating, and now we want to take them at scale. So wanted to understand this over the next 2-3 years. For example, if you are going to grow at 15%-17% and these new solutions start kicking in materially, if not significantly, we could easily achieve 20% if you think that is a reasonable estimate. So from INR 2,600-INR 2,700 this year, we could be at INR 4,600 in the next three years.
This is organically. I'm not factoring in any acquisition as yet, so wanted to understand this bit.
I want to smoke whatever you're smoking. So, you know, I don't think you should be thinking businesses can grow 20% in a row for 5-6 years. I would love to be in those businesses and make profit margins like we are. I think I will, I mean, I like your commentary. I think I will use it to set targets internally now. But, I think we will stick to what we have said. We have from FY 2021 to 2025, we have given a growth guidance of 20, you know, of growing at roughly a 17%-18% growth revenue. As we get to our number at FY 2025, we will come back with FY 2027 and maybe an FY 2030 number of revenue. We, of course, look to deliver alpha, but we have to say alpha over what, right?
We are in many businesses and many sectors. So I think we overall look at delivering a good double-digit growth. We have done that for the last 4, 5 years. We hope to do it in the coming years.
Okay. What kind of business point addition and compliance network can we expect? I mean, because earlier you indicated that it should be 90% or even plus. So where do we stand, and how do we see this moving ahead this year?
Yeah, I think, you know, again, not much change in the last since we. You know, the last update was two months back in May, and now, not much change. Like we told you last time, I think 85% of the ATMs are compliant, and, you know, I think that process is now more incremental and, organic. Our network is almost fully compliant, so any new business point gets added into it, sort of, you know, comes along with that chunk.
Okay. And, and lastly, since we have a decent idea of how the funnel of outsourcing is moving, is there any incremental visibility on what could be the new business wins? I mean, do we have a better understanding, a better likelihood, or does it remain similar to the last commentary that you shared?
Sorry, we didn't really understand your question, but I think what we, what we remember, what we have said about is that there are about RFPs on the ATM business are roughly about totaling to 20,000 ATMs. Those RFPs are expected in this year to launch and hopefully get concluded. As they close and depending on what sort of, you know, depending on the terms of the RFPs, we will obviously try and bid for what makes sense to us, and we'll update you end of the year what the results are be.
Got that. And, about the INR 300 crore CapEx, could you give us a sense how this is going to be spread out, I mean, across our infrastructure, such as vans or on the ATM side, or on other businesses that we are incubating or R&D or something like that, that would really help?
I mean, we don't have an exact split of this by all of these things, but I think, we, a large part of the, the CapEx is going to go into, executing our new, wins, including the technology-related wins. We have, front-loaded a significant part of CapEx for an infrastructure revamp in the last three years. I think for the next couple of years, I think the CapEx spend will be more, linked, majority of that, not all, will be linked to some of the new wins, and then obviously whatever we need to invest from a technology perspective.
Predominantly it's going to be on the business execution and infrastructure you meant?
Yeah, I think it's. a large part of this CapEx will be growth CapEx, and the very little, a lesser portion will be on maintenance.
Got that. And, and lastly, are we able to come closer to any identified opportunities to bolt on growth?
You know the norms. As soon as we are close to anything, we will have to disclose it, and we will disclose those.
All right. Thank you, and all the very best.
Thank you. Ladies and gentlemen, that was the last question for the day. I now hand the conference over to Mr. Rajiv Kaul for closing comments.
Well, thank you for your questions. You know, I would again thank you for joining this call. Good, steady quarter. We focus on FY 25 number. Wish us luck, and we'll talk to you in more detail at the end of H1 and our October cycle. Thank you so much.
On behalf of Nuvama Wealth Management, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.