Ladies and gentlemen, good day and welcome to the MapmyIndia NDR Q3 FY25 Earnings Conference Call hosted by Anand Rathi Share and Stock Brokers Limited. 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.
Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Shobhit Singhal from Anand Rathi Share and Stock Brokers Limited. Thank you, and over to you, sir.
Thank you, Anuja. Good morning, everyone. On behalf of Anand Rathi Institutional Equities, we welcome you all to Q3 FY25 Conference Call of MapmyIndia. We have with us today Mr. Rakesh Verma, co-founder and chairman of the company, Ms. Sapna Ahuja, who is the COO, Mr. Anuj Jain, CFO, and Mr. Saurabh Somani, company secretary and compliance officer. I will now hand over the call to Mr. Rakesh Verma, sir, for his opening remarks, after that we will open the floor for Q&A session. Thank you, and over to you, sir.
Good morning, everybody, and thank you, Shobhit, for the quick introduction about the team that is here today to respond to any questions that will follow my talk. Let me start saying that overall, we are happy with the results of the Q3 FY25, so in Q3 FY25, we successfully operationalized the joint venture with Hyundai AutoEver in Indonesia, marking an important step in expanding our global footprint.
As part of our long-term strategy, both the Mappls App and Mappls brand will continue to be an integral part of the organization. On the financial front, our revenue for Q3 FY25 reached INR 115 crore, showing a 25% year-on-year growth. Over the first nine months of the FY25, our revenue grew to INR 320 crore by 17%, up from INR 273 crore during the same period last year.
In terms of profitability, our EBITDA for Q3 FY25 was INR 42 crore, yielding a margin of 36% compared to INR 36 crore in Q3 FY24 at 39%. For the first nine months of FY25, our EBITDA stood at INR 122 crore, with a margin of 38% as compared to INR 114 crore and a 42% margin recorded in the same period last year. We'll continue to prioritize the Mappls App as a key strategic asset while we will calibrate the costs associated from Q4 onwards.
Our profit after tax for the first nine months of FY25 was INR 99 crore, up from INR 96 crore in nine months of FY24. In Q3 FY25, consumer tech and enterprise business, C&E is what we call, revenue surged by 39% to INR 65 crore year-on-year, while automotive and mobility tech A&M revenue had a steady growth of 9% to INR 49 crore year-on-year, much better than the auto industry growth itself. In the first nine months of FY25, our A&M revenue grew by 16% year-on-year, and number of licenses grew by 23%.
Our C&E revenue saw a 19% increase in the same period. Our Map-led business delivered a very strong 33% growth to INR 87 crore in Q3 FY25 year-on-year, while the IoT-led business had a growth of 4% year-on-year during the quarter due to delays in some anticipated businesses. However, subscription services grew 31% year-on-year for the quarter.
Our continued focus to build IoT business with higher margin subscription revenue has resulted in the IoT-led EBITDA margin to grow from 8% in nine months of FY24 to 12% in nine months of FY25. Our efforts in the previous quarters culminated in securing a major deal with one of the largest global social media networks across their app platforms in India, as well as significant wins in the Q-commerce space and BFSI vertical, which had a strong positive impact on our C&E business.
We also made significant strides in customer acquisition and deepened relationships with existing clients through upselling and cross-selling initiatives. This includes notable go-lives and project wins across the various sectors such as automotive, fleet management, tech startups, traditional corporations, government, and defense. With this, I would like to end my part of the initial commentary, and the team is here, including me, to answer any questions that the participants have. Thank you.
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 the touch-tone 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 Shobhit Singhal from Anand Rathi Share and Stock Brokers. Please go ahead.
Thank you. Sir, I have two questions. Sir, first on the C&E segment. So C&E revenue growth trajectory is sustainable. I mean, as it appears that it was a one-time project revenue which got booked in this quarter, which explained the steep rise in outsourcing expenses. So can you elaborate more about what we did in this project, and is the order related to this project exhausted or more to come in Q4? Thank you.
I didn't understand your question well, Shobhit. Did you mean that our growth in C&E this quarter is a one-time thing?
I'm saying that so this growth which we got, so I think there was one government project as well which we booked in this quarter, and also there was a steep rise in our outsourcing expense, which you have mentioned in your presentation as well.
I think they are two different things. Outsourcing is a different. It's a question I can address because that's the only item that probably in the presentation you will see quite a big jump in our expenses, and that relates to the corresponding government projects, which is part of the revenue, so those outsourcing expenses, why we do is when certain projects have to be scaled up very quickly and within a very quick period of time, we do have to go outside and use outside resources.
And also, it includes certain software parts, what we call it, which becomes part of it, so altogether, it is very much in line with the revenue that we generated during the quarter.
Okay. The second question is on the Gtropy. So last quarter, you said that Gtropy funding issue was resolved, but if you see, hardware sales did not pick up this quarter as well. So any specific reason, or have you rationalized your authorized dealer network here?
Okay. I don't use the name Gtropy. I say our IoT.
IoT.
IT-led business. Yes, in Q1, due to certain constraints within Gtropy, there was a problem. Now in Q3, we have spent. I just mentioned it. That certain IoT-led business we were expecting from the customers, which has been delayed, and hence the impact of it. It will happen in the next financial year. At the same time, if you see the good part of the IoT-led business, subscription revenue has increased dramatically.
Right. And sir, last question is, so at the start of this financial year, so we have given a guidance that for the full year, we will be able to achieve around 25% kind of growth. But given that in nine months, we did only 17% type of growth, so I ask for fourth quarter is around close to 45%. So are we still sticking to our guidance?
Yeah, we still believe strongly. Already one month of the Q4 is over. So we still believe strongly that we will be able to attain the 25% growth for the whole year.
Okay. Great, sir. Yeah, thank you.
Thank you. The next question is from the line of Chandramouli Muthiah from Goldman Sachs. Please go ahead.
Hi, good morning, and thank you for taking my questions. My first question is just if you're able to provide a little bit of color on some of the deal wins that you've announced this quarter and what that does to your order backlogs. I think the last update we had on the order backlog was towards the end of previous fiscal year, roughly 1,370 crores of open orders.
Just want to understand what the quantum of recent deal wins has been, what the nature of those deal wins has been, and then where our existing order backlog looks like in terms of visibility going forward.
The exact number of the order backlogs or what we call open order books, we'll disclose it as part of the 31st March, and that's the practice we have been following all through. But from the other question that you asked, we have been winning, and new projects winning, I think we have described in the investor presentation. If you look at the C&E, it's almost many verticals of C&E we have been able to win, including the global contracts.
So the names I wish I could have named them, but unfortunately, because of certain NDAs, we are not able to mention without their approval, and hence I'm keeping quiet about it, but anybody can make their own guess. So order backlog or open order, how it will look like at the end of the year, definitely better than last year. That's the best answer I can give you. We are on a very strong trajectory, and we believe that there is a lot to be done by us in execution, and the market is there. But of course, we have to put our act together, honestly.
Got it. Got it. That's helpful color. Second question is just around seasonality. Historically, we've seen second half and last quarter seasonality pick up in terms of MapmyIndia business, and we had a little bit of unfavorable lumpiness in the first half of the year in terms of contracts closing and so on.
So as you look towards the end of the fiscal, could you just share some of the drivers that are giving you the confidence that you can meet your 25% sort of implied growth target? And then I think as the previous participant asked, meaningful pickup and growth expected in the fourth quarter.
Okay. To help you get some color on the Q4 confidence about 25%, let me say that I did mention about it even in the last Q2 earnings call, that there are certain contracts which will get completed, not completed, I mean, which will generate us revenue in Q4, and they exist. They are a long-term contract, and hence we are not worried about it. And these contracts are one side they are from C&E, either from the corporate world or the international companies or the government side.
Even in the automotive, I must give you all a general color that the Q3 of any financial year, the automotive is slow, and those who do the automotive OEM analysis will find that the, because ours is based on manufacturing of the vehicles, not sale of the vehicles, October, November, December, particularly November, December, the vehicle productions get slowed down because of the new year model, and hence you'll find the A&M not doing that good in Q3, the growth, but still we have done 9% growth.
I think surprise line was it? It's 9%, and you see the number of licenses I also talked about have increased 23% on a nine-month basis. That shows that our penetration, either within the same automotive OEM or by winning new businesses, particularly in the EV space, is also growing.
Got it. That's helpful. And my last question is just around your earlier remarks around the temporary increase in technical outsourcing costs. Is that cost that you're incurring ahead of the curve for potential pickup in revenue you expect in certain types of business accounting?
No. It is related to the revenue. The way the accounting standards do is it relates to the revenue. Expenses have to be tied to the revenue. If I'm expensing it, I better have the revenue for that.
Got it. So it's unlikely that this elevated level of technical outsourcing costs recurs in the near term. Is that the way to think about it?
No. The way to look at it is what kind of project this technical outsourcing mostly it goes for the government projects. Let me be straight on that. And in that, if the revenue is high in the government projects in a particular quarter, let's say it was in part in Q3 also, but in Q4, if it is high, the technical outsourcing expenses will be also high.
Got it. That's helpful. Thank you very much and all the best.
Thank you. The next question is from the line of Anmol Garg from DAM Capital. Please go ahead.
Yeah. Hi. Thanks for the opportunity. I had a couple of questions. Firstly, wanted to understand that how are we looking towards the government business? So are we bidding on government-led GIS projects? And also wanted to understand how are the margins in these kind of projects?
Okay. Government projects are no longer, we no longer believe that it's no-no. If you had asked me three years back, we would like to, we always used to shy away. But as we are watching that a lot of government schemes are coming in this area of what we call GIS or geospatial, whichever terminology, we would not like to skip them. We would like to grab those opportunities because there are some added advantages also.
The only issue we are keeping in mind, and we'll continue to keep that in mind, is pick up only those government projects where we know that we will get paid. So if you look at even now, the receivables in government, overall receivables is less than 100 days if you have seen our financial statement.
Thanks.
Overall. Okay. Okay. It's fine. So overall, it is less than 100 days receivables. Now it is a mixture of government receivables versus others. But the beauty is we are not having a bad debt, or our provision for bad debt is not increasing. So we are happy to do that government project, and we are doing it.
The last part of your question is margin. Definitely in the government work, the margin is not high like what you see in typical corporate and automotive. So it does draw down the overall margin of the company, but we have, we at the board level also, we are very clear that we must undertake them for hundreds of good reasons.
Right. Understood. So just to follow up on that, so given that we are taking now more government projects, should we assume that our more sustainable margin range would be around 35%-36% going ahead?
35, 36? What margin you are talking about? Gross margin or you're talking about net profit?
EBITDA margin.
Huh?
EBITDA margin.
EBITDA margin is the net margin only.
Right.
If 35%, I'm not aware which government projects for which company provide 35%-36% EBITDA margin. If you can help me and tell me, I would love to pick up.
I'm talking about the full company's margin. Just wanted to understand that.
For nine months, we are at 38%.
Right.
And I can tell you that by the year end, we might have 20% of our revenue coming from the government projects. I'm just giving you a kind of a ballpark number. And if we are at 38%, well, I can't predict, but the year is almost ending. So we should be around that only, somewhere around that.
Understood. Understood. Secondly, sir, wanted to understand our confidence on next year's growth trajectory. Now, do we have enough order book and enough confidence that we will go back to the growth trajectory like we have in the last two years?
If we maintain a 25% growth rate, you can use your calculator, and you'll see that we'll attain INR 1,000 crore in FY28.
Right. So should we assume a trajectory of around 25% growth rate going ahead?
Yeah. We are committed to that, and our plans are all based on that. And that's why I said in the beginning that good execution and the team is very strong, so we don't see any issue.
Understood.
As a matter of fact, just to give some color, yesterday in the board meeting, all the four business heads presented their case. They explained everything to the board members, and they were very happy that the team is fully competent, qualified, and experienced to carry on this target of INR 1,000 crore for FY28.
Understood. And sir, one last one from my end. If I look at our B2C spends this quarter, you have indicated that you have spent around INR five crores in this quarter for B2C. Now, going ahead, how should we see these spends? Would it be range-bound, or would it increase as we focus on the Mappls application?
Okay. Let's put the correct color on this B2C. As far as the Mappls App is considered, I don't think we ever have looked at it as a B2C business because the Mappls App is a driver. A lot of R&D, a lot of innovation is shown through Mappls App. Take the example of the Junction View, which we did. That was an innovation within the company which was depicted through Mappls App.
But Mappls App doesn't give revenue, but the use of those technologies, innovations, lead to creating revenue in the B2B. Mappls App, I don't look at so much as a B2C business. I mean, I think at least I'm able to make that clear today. It is an integral part of supporting our B2B and B2B2C business.
What you are talking about, B2C business, that's what we have from Q4, starting from Q4, but the impact when expe nses could not be saved in Q4. But going right now onward from Q4 now, we are calibrating that and saying that we will not spend on creating a business out of Mappls App at this point of time. But certainly in future, the opportunity comes, we'll look at it.
Understood. Understood. Sir, are we giving any size of the deal that we have signed with the social media app in this quarter?
I wish I didn't have the NDA, and I could have talked about it. So I hope you will understand.
Sure. Sure. Thank you so much, sir, for answering my question.
Thank you. Ladies and gentlemen, to ask a question, you may press star and one. The next question is from the line of Abhishek Kumar from JM Financial Limited. Please go ahead.
Yeah. Hi. Good morning. Thanks for taking my question. First question is on Hyundai, Kia, both the India deal as well as the Indonesia JV. Last quarter, we understand because of slower production, it is not reflecting. But how has that deal progressed? Have we now increased the number of models where our software is going in? And how should we look at it in terms of achieving its peak quarterly run rate going forward? And also any color on what are the progress on the JV? When can we expect revenues or some profit coming from the JV?
From our side also to give you more color, let Sapna say a few things, and then I'll add on to it.
Yeah. I'll address the question specific to Hyundai and Kia vehicles. Yes, from this quarter onwards, all models of Hyundai and Kia will be having.
All are having.
Yeah. They're all. And then say Q4 completely 100% will be there. Q3 partially. Yeah. So Q4, 100% of these models will start having the MapmyIndia maps built in. As regards to the Hyundai and Kia vehicles in Southeast Asian market, there is still some time. We are working towards that. The initial part of readiness of the content happened, and now we are productizing it to make sure that it's soon, very soon, start generating revenue. And we see that happening maybe towards the next financial years. Yeah.
Okay. Let me add something more. The JV in this quarter, Q4, the JV is getting. I mean, JV was operationalized in terms of its legalities and all that only end of last year. So they had only 10, 15 days even to report anything about it. So Q4, they are going to put things in place, make sure that the eight or 10 countries' maps are all in place. And hopefully, the revenue, one, that will go to JV only for what they licensed to Hyundai, Kia for the Southeast Asian countries.
But the other opportunity that we are getting is because of those maps and our software. Interesting thing, I hope you can understand. Our software will go to Hyundai's competition, non-Hyundai Kia cars because they will not take the software of Hyundai. And that will start generating us revenue. But again, we hope. We are hoping that either from Q1 or Q2 of next financial year, we'll be able to get that. Did I answer your question?
Yes. That's very detailed and clear. One quick follow-up there. Just in terms of size of the market, our understanding is that the volumes in Southeast Asia are similar to Indian market, but the realizations are 2x-3x of what we get in India. Is that true? And does that mean that the TAM that we are looking at, potential TAM, is 3x of India's automotive market?
It will take some time, Abhishek. I mean, see, joint ventures formed, they will start putting pieces together. And in automotive, always there is a one-year lag at least from the time let's say example, one Chinese company like BYD, just as an example. If they say that, "Okay, they will go ahead with our solution, with the JV, our software, JV's map data," it will take them at least a year to put it, operationalize it, put it in the vehicle.
So expect and that is the beauty of the automotive wave. Once you get in and it gets started, then you are there for almost like a five-year journey. So don't expect any magic numbers, but the more we should look at it, how fast we are able to win during the FY 26 period from the because of the formation of the JV.
Certainly, TAM is quite like.
TAM is like India size.
Yeah. Okay. Yeah. My question was more around TAM, not our revenue, but point taken. Next question is on some of the wins that we have had in quick commerce, etc. That's the space that I assume even Google Maps target very aggressively, and they cut their prices also a couple of quarters back. So good to hear that we have been winning in e-commerce and new-age digital.
What is, in your view, leading us despite competition being aggressive in pricing to win these? And does that, in your mind, validate the product market fit that we have and kind of addresses? I mean, anything you can give in terms of why we won over competition in some of those deals? Thank you.
You know, there are a few small things, a few important things, and they matter. The quality of our product, which means the map data underlying the APIs or SDKs that we give it to them. And when that is better than the competition, these quick commerce and all these quick commerce is particularly very hyper-local. And that level of detailed maps is what is helping us to win also.
Yeah. One is quality of product. The other also is quality of service. I mean, we being very agile, being very flexible to support them with the integrations, with whatever desires they have in terms of technical features because we have control over the complete data in the backend. A lot of new innovation features that they want, they are able to get it implemented through our product and our services that we provide along with that. And that's where they find it more comfortable to work with us.
Sure. One quick follow-up on this. Just in terms of order to revenue conversion here, because these are APIs and volume-driven, does it mean that the order to revenue consumption is much faster compared to any other typical B2B or B2G space, and therefore, I mean, the revenue growth here could or ramp-up could be faster?
Yeah. Here, in these cases, the orders are typically more in terms of what you consume is the order for that month, and that's the revenue. It's not like Hyundai, Kia, INR 400 crore order contract to be consumed over five years of. You are right. It's immediate. It is a contract with them that they will work with us for the next X number of years. But we don't estimate here because it is not known how much consumption will happen.
Understood. Great. Thank you so much and all the best.
Thank you. The next question is from the line of [inaudible] Patel from Avendus Capital. Please go ahead.
Hello, sir. Good morning. I had a couple of questions. So the first one being, what is the expected revenue contribution from our drone services towards achieving our 1,000 crore revenue target for FY28?
I think I would rather like to skip this question at this point of time because we will have our business planning session end of March, and we'll work it out, and maybe next time we'll be able to tell you that.
Okay. Sure, sir. So my next question would be, what factors have contributed to the decline in our device sales within our IoT-led segment this quarter, and was this decline an intentional strategic decision? Sorry. Can you repeat that question once again? I'm not very clear. Yeah. So I meant to ask, what factors have contributed to our decline in the device sales within our IoT-led segment this quarter, and was this decline an intentional strategic decision?
Yeah. I think we have mentioned this in the presentation as well, that there has been a delay in certain business that we were expecting to happen in the last in this quarter.
For large ones.
Those were the large contracts that would have generated that revenue. Since that did not happen, you see that decline. But it's not that it is just postponed to the future quarter. It's not that it's not going to happen. Yeah. Okay, so they've answered your query.
Okay, so any idea on when that could be happening, if it's postponed for the future?
Let's wait. I mean, at least it will not happen before that. That I can say for sure.
Okay, sir. Sure. My last question being, with our partnership with Qualcomm Tech, what revenue impact and growth opportunities do we anticipate in our automotive and mobility tech segment in the upcoming quarters?
Yeah. So initially, we are looking at this engagement with Qualcomm mostly from the perspective of automotive OEMs, not the aftermarket, but the inline mindset kind of products and solutions, mostly around the connectivity front. This is given that it's for automotive OEMs, the impact on revenue will be seen post one year at least here.
Let me add some more color to that. In automotive OEM, we are tier one suppliers, partners in our own space of navigation, data, and all that. Similarly, there are lots of global players who provide certain types of technologies to these OEMs as tier one also. Now, this is a very nice marriage between one of those global players like Qualcomm and us so that the technologies they have and what we do, the OEMs will find it much more comfortable to work together with us.
Understood, sir. Thank you so much for taking my question.
Thank you. The next question is from the line of Nishant Chandra from Temasek. Please go ahead.
Hi. Thanks for taking my question. I had a question on the IoT hardware line that has been the IoT hardware revenue profile. So just to understand, the number of units sold would be something in the zip code of 170,000 units that we've done on a nine-month basis. Is that right?
Say that again. Number of units sold during the nine-month?
So for the nine-month period, we've got the revenue number from IoT hardware is disclosed in the investor presentation, right? Now, when I compare this with last year in terms of number of units for full year, I think we did something like 300,000 units of hardware sale. I'm trying to understand what the INR 38.2 crores of revenue pertains to. This should be something like 160,000, 170,000 units of sale. Am I thinking about it the right way?
Yeah. I mean, the nine-month devices is around that number only.
Okay. Understand. And the full year number would, again, track something close to 300K, or is there something that we need to change the expectation versus last year on the baseline of hardware revenue?
I don't know. Did we share that 300,000 numbers, or you guys estimated on your own?
No, 300,000 is there in the annual report. I think the IoT double-click had the number of devices, the revenue from hardware and revenues from software split in the annual report. So I was just trying to see what is the unit value, and then I used the same unit value here to see what is the implied number of units.
300,000, I don't think so. Okay. And let me for this financial year. But the good thing that has happened is while a couple of, I think, two of the businesses that we were expecting to start generating revenue from Q3 itself, since that is postponed, put it that way, for the next financial year, we focused also on seeing how the subscription revenue increases. And that's what you see, that there is a 30% plus growth in that, which actually is ideally what that's what we would like to see. The hardware sales being down has affected on the revenue growth. Otherwise, the revenue growth would have been higher. Instead of 25%.
I mean, I think the hardware revenue declining YOY per se is not, so the way we look at it is that there are two parts, right? So here, it's not like you're making profits from hardware sale, which is materially large. The profits are anyway driven by services sale. And hardware effectively enables you to make a services sale. So that's why I was just trying to see what is the universe of sales that we're doing on the hardware side and if that is so let's say if it is not tracking, let's say, last year's number, why is that the case? Because your points of presence on the retail side should be similar to last year. So how should we interpret that momentum on sale of hardware?
Retail side has not gone down. Some of the big projects that we were expecting this quarter, had that happened, your number of 300,000 or something like that would have happened. So that's the reason. I mean, we are just giving you the exact picture. That's why it has happened. Okay? And during the whole year, whatever business we expect, because these are the businesses we work for a year or so, such large projects, one or two slips can happen. And it has happened, and we are acknowledging it.
Understood. And the last one is, if I were to look at the stock of devices which is giving you this subscription revenue on IoT sale, where would that be currently in terms of closing number? Because I think that number was close to 500,000 devices in end of 2024. That should be something like 650,000, 670,000 devices for nine months, 2025. Again, is the number broadly the right zip code?
You're talking about the inventory, or you're talking about?
No. No. The number, so if I look at the sale of subscription devices in IoT, how many devices would be subscribed to your IoT services? This should be somewhere around 600-700K units is what I thought. I just wanted to verify that number with you.
Your number is right.
Okay. TK. Okay. Got it.
Thank you. The next question is from the line of Gautam Rathi from CWC. Please go ahead.
Hi, Mr. Verma. Thanks for taking my question. I had a couple of them first. On the Hyundai contract, just needed some clarification. So this is a 400 crore contract for five years, but how should we think about the peak ramp revenue in this contract, right? Is it fair to say because even if I take average, it's an 80 crore, but is it fair to think that at a peak, this could be like 100-120 crore kind of a revenue? And just to take a guess, today, we would be not even, say, 10-15 crores in that contract. Is it fair to think it that way?
See, when they have signed a contract for that much, okay, and they have said that in five years' time, based on their projected sale of vehicles. Now, they have not guaranteed every year or every month's amount, quantity. So you can look at it many different ways. One is 400 divided by 5 gives you 80 crores. 80 crores divided by four quarters gives you how much? 20 crores. That's one way. The other way is Hyundai is also expanding.
In Q3, their sales were also down. Like nothing. I mean, from Q1, normally, Q1 and Q2, we have seen automotive OEM, their revenue going up. This is what we have observed. So you can track it very easily with Hyundai car sales. And as Sapna said, that all the vehicles of Hyundai Kia, which comes with navigation or connected vehicle, they will all have no exceptions. They will all have MapmyIndia maps.
Okay. Understood.
So it might be starting from X number. It might become 2X maybe in two years or three years' time frame. It's possible.
Understood. And Mr. Verma, the other thing on the Hyundai JV, last time around, we were saying that even in the JV, the map making part, right, the development of maps would be outsourced to MapmyIndia, right? So are we already seeing the cost coming for this in our business for which in future we will get the revenue, or is it still too early?
Let me clarify. One country, they have outsourced to us. Okay? The other countries, it is better that the local players of those countries who are getting wiped out by the big giant, they have gotten a new life. Okay? And they are being nurtured by the JV to make the maps good. How they are being nurtured by JV? MapmyIndia is providing them with certain tools and technologies. That's one side of it.
The other side is when they provide that data to the JV, the JV gives it to MapmyIndia to put it in the format so that that data can be sellable to or licensed to any other automotive customers, including Hyundai Kia. If it is non-Hyundai Kia, then it will get added to our software, and we will have a further revenue opportunity, one, due to the software part, and the second is when we process the data into a particular, when I say process the data, productize it, we will also earn certain revenue.
So this is the model on which we are operating. But as I said, start expecting it, all these for revenue, and gradually see how it builds up. The Southeast Asian market is as big as the India market. The India market, we have been working for the last 10 years, and we have gradually gone up. Similarly, not 10 years, but similarly, it will take ramp up of two, three years, I suspect, where the full advantage of the TAM that is available in Southeast Asian countries, the JV will be able to achieve.
Understood. That was really helpful. The last question, right? How should we think about the growth in the government part of the business? If I take nine months, FY25, what would be the growth in that business versus the same period last year?
Which business?
Government business.
Government business. See, we were like a couple of % in government business for many, many years. Last two, three years, we have started them increasing. So last year, I think, if I remember correctly, it was single-digit %.
Percentage of our total revenue from government was in the single digit. It was in the single digit. This year, I'm giving you advanced information that we might be definitely will be in double digit, but less than 20%. Less than 15%, which is more or less.
FY25, then only I'll know the exact number, but I'm giving you some color to it.
Mr. Verma, again, if I understand it right, with your government business going up, is it fair to assume that your margins, overall blended margins, could be lower? Because in one of the earlier questions, you mentioned that your margins should be around 38%-40%, 38%, right? So is it fair to assume that as the share of government business goes up, we overall?
Let me answer this question very straightforward. Internally, we are looking at the revenue growth first. That's the first important thing we are focusing on. Second thing we are focusing on, our EBITDA growth. I'm not talking about the margin. I think it will give you a wrong color and understanding. If my EBITDA growth happens, that means my PAT growth happens, and that's what ultimately matters to the company and to its shareholders. So I will strongly suggest that after this financial year, let's focus on, instead of margin, let's focus on the growth of EBITDA.
Understood. That's very fair. Thanks a lot. Thanks a lot for answering the questions.
Thank you. Ladies and gentlemen, to ask a question, you may press star and one. The next question is from the line of Sudhima [inaudible] of Aquin V Ventures. Please go ahead.
Hi, Mr. Verma. Thank you so much for giving me the opportunity. I have two questions. First, I just wanted to know, earlier, if we see that we have an average growth rate of around 30-35%. And now in FY24, we are targeting around 25%, and going forward also, we are seeing that 25% year-to-year expected. So I want to know what is exactly happening in the industry. Are we facing any competition, or what is happening?
Why are we not able to have the earlier run rate of 35% plus growth rate? And also, what is the reason of declining margins? I know that B2C cost is what we have incurred, and that has resulted in the dent in margins. But since we are going to calibrate this cost going forward, then again, we are targeting for 38%. So what is the reason for the dent in margins also and its target?
Let me first answer you on this margin. Just now, I made the statement that going forward, let's start understanding what is the EBITDA growth and not this margin. Because if we focus on this margin, my revenue growth will get adversely impacted. Any one of you, and I'm sure all of you understand that. If the revenue growth happens with that kind of EBITDA margin, then it's like you are living in a different world.
So you are talking about the competition and all that. Yes, competition is there all across. How can we operate without competition? Even in maps, in certain parts of maps, we do have competition from Google. Our job is to try to get that business from them, snatch that business from them, and bring it to us. In government also, there are many companies who are bidding and who are trying to get, and they are also growing. So every business vertical will have a different kind of margin.
The company's objective is how to keep increasing the revenue growth. Answering your first part of the question about that 35%-40% growth in the revenue, well, we never said 35%-40%. I don't remember ever saying it. What we have said was 1,000 crore revenue in FY28. Some people like you might have done some reverse calculation and come to the conclusion that 35% is required. I don't know how it was computed. The last two years, we did achieve around 30%-35% growth. So we are targeting 1,000 crores, and I'll continue saying that the 1,000 crores is our target for FY28.
Hello. Hello.
Yeah.
Yeah. Yes. Actually, just the reason we wanted to know is just why the growth rate has slowed down. I understand that you have a target of 1,000 crores by FY28, but we were growing at 30%-35%, and just reaching to 25% growth is a concern. Or maybe just we wanted to know the reason behind that.
Anyway, another way to understand is from a lower base, the percentage can be higher. From a higher base, the percentage can be lower.
Correct.
I think there are several ways to look at it.
Got it. And the second question is, so I wanted to understand on this Hyundai Kia contract. So since you said that we have five-year contract, I wanted to know how does it work? Every year, if, for example, Kia makes 100 vehicles, your maps are being installed on all of those 100 vehicles. Then in second year, if they again manufacture 80 vehicles, then that is your 80 maps are being installed. Then how does it work? What happens post five years?
Jo aapne vehicles install kar diye hain, will there be the renewal of your mapping thing, and post that you will have a different contract of new vehicles being manufactured? And the ASP of INR 800 includes the installation part, and is it includes your renewal also?
Okay. Okay. I will take that question. It's clearly, our contracts are based on the number of vehicles produced for the program for which we have signed the contract. And under one program, there could be multiple make and models of the vehicle that could fall in. So Hyundai Kia is set all vehicles, but that would be different for different regions. Our contract terms condition could be limited to specific vehicle programs also.
Now, our contract, every contract would be different from the perspective of the number of years and the renewal strategy. But typically, we sign, the licensing term is for three to five years, and post that, there is a renewal, which is an option to the OEM and to the end customer as well. So they can get the plan renewal at a certain cost from that period.
Okay. Got it. Just a request. Will it be possible for you guys to give more granular detail on your segment-wise? Like, what is the variable and fixed contract mix? And in variable, what is for A&M, what could be the number of vehicles which are being, we are installing our maps on a quarterly basis? So it will give us more clear picture to track the KPI of your business. Otherwise, it would be very difficult for us to predict like what is going to happen in the next quarter. Share the number of vehicles towards number of licenses?
Yearly, we are set. Early, but just now, but still to help you all, I didn't mention that we had a 23% growth in the number of licenses as compared to the last year. Last year for the nine months. So if you have that number last year, so you can compare that and see 20% growth has happened.
Yeah. Okay. Got it. Got it. Thank you so much. That's it from the side.
Thank you. Ladies and gentlemen, this was the last question for today. I would now like to hand the conference over to the management for closing comments.
Well, thank you all for listening to us patiently. All that I can say is that we are on track. We have a great team here to deliver what we talk about. So let's hope that you also have confidence in us the way we have confidence internally. Thank you so much.
Thank you. On behalf of Anand Rathi Share and Stock Brokers Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.