Ladies and gentlemen, good day and welcome to the Network People Services Technologies Limited 2QFI 26 earnings conference call. As a reminder, all participants' lines will be in 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. Harshil Ganjani. Thank you, and over to you, sir.
On behalf of [audio distortion] , I would like to extend a warm welcome to everyone for joining the conference call of Network People Services Technologies Limited Q2FY 2026 conference call. We are pleased to have with us today the esteemed senior management team, Mr. Deepak Chand Thakur, Chairman and Managing Director; Mr. Ashish Aggarwal, Joint Managing Director; and Ms. Savita Vashist, Executive Director. The call is scheduled for 40-50 minutes. To ensure that everyone has the opportunity to participate, we kindly request that each participant limit their questions to two. Hence, this will help the management address as many as possible within the time frame. If we are unable to address any questions during the call, please feel free to reach out to us at [research@directkirinadvisors.com]. We'll be happy to coordinate with the management team and arrange further discussions. We appreciate your understanding and cooperation.
We look forward to an engaging and productive call. Now, I hand over the call to Mr. Deepak Chand Thakur. Over to you, sir.
Okay. Hey, Harshil. Thank you so much for the introduction. A very good evening, everyone. We really look forward to this connect with our shareholders every quarter. While we are on a mission to be a leading paycheck coming out of India, your support will definitely take us through this journey. We are sure about that. In fact, as we know, Warren Buffett has stopped writing the annual letter. We live by his point very clearly that someone's sitting in the shade today is because someone has planted a tree a long time ago. Trust me, we would like to replicate that in India's paycheck statement. We have been through a deep learning curve since the last four quarters, and it was all your confidence that stayed with us to pick up the numbers we have today.
I will touch base on some of the key business updates and our plan here onwards. About the numbers, our quarterly revenue has increased to INR 48.61 crore, which is about a 39% jump, quarter on quarter over INR 35 crore last quarter, I mean, from Q1. At the same time, our EBITDA stood at about INR 15.71 crore, which is again a 40% jump over the last quarter. Our net profit rose about 38%, which is almost INR 10 crore in absolute number, compared to INR 7 crore in the previous quarter, again maintaining a healthy profitability of about 20.4% over the total income. After a revenue impact last year, we committed to de-risk and diversify the business, and in a breakneck speed, we picked up from there, arrived really heavy within the last four quarters.
I would like to thank my colleagues and everyone in NPST who made sure we are building upward trend thereon. Just to reiterate about our business, we added multiple revenue sources in TSP, payment solutions to banks, fintechs, and corporates, leveraged our software capability on implementation and bidding for key projects, including Africa, which was based on an open banking platform, launched multiple new products, including Banking Connect. Now, that's about the interoperability between net banking and mobile banking, which was envisaged about one and a half years ago by RBI. We were, in fact, one of the first TSP to bring up this solution in the market. Then we saw that there is a need for SaaS-based revenue in the TSP business, and that is where we launched Bank in a Box. We declared about this last quarter, and we have it now.
Bank in a Box is more about whatever we have built for the banking ecosystem. How do we create a sachet and take it to small to mid-sized banks so that it opens up the opportunities around 2,000 banks across India? Now, Coins Platform, which is an offline payment solution, which we built about one and a half years back, we got multiple orders there, and that's where the overall TSP business is seeing a lot of traction coming up on device as a service model. Along with this, all you know is our core solutions, including UPI banking, Super App, IMPS, BBPS, and there are some heavy investments we are doing around large-scale products, including how do we take open banking to the global market. We got new accounts in UPI acquiring for small banks, BBPS, voice-based payments. That's the new venture.
Payment solution for payment gateway and payment devices for public sector bank. We have also added one more sponsor bank for our payment platform business that will further de-risk our Evok business. In payment platform, we are on a mission to re-engineer the entire Evok platform. Our intention is to launch version 4.0 by end or the early next quarter, majorly to address some of the key industry challenges which we identified in the last couple of quarters around early settlement, around the incremental pressure bank has for the CASA growth, and the high success rate for the payment aggregators. We are also focused on launching interoperability in payment platform for payout on autopay. This will increase our traction and the target audience.
RegTech, which I spoke about in Q4 last year, is no more a product for us, but in fact, the entire vertical which we believe will be a big thing in the next four quarters. We plan to take it to multiple segments here onwards. Earlier, we were looking just at the acquiring space, but now can we take it to beyond merchants? Can we take it to more markets, more segments? That is mainly because our accuracy rate now in our RegTech is about 90%, in fact, more than that for the fraud prediction. Next two to three quarters, we will be spending efforts in establishing the brand and expanding our reach in the segment. There has been a tremendous effort. With all of that, there has been tremendous effort in scaling the funnel, which we believe will take us to highest-ever performance soon.
We believe that what we targeted for the revenue growth in Q3 is doable. We believe that the incremental impact will be carried in multiple quarters thereon that will lead to sustained growth trajectory for the company. We are keen to invest into AI in all our delivery efforts, move our efficiency to industry best practice. Our intention here is to be more productive and performance-driven in terms of tech delivery and reduce the GTM for future solution in market. I know it's a long way, but these steps will create competitive advantage for NPST and reduce the resource dependency for critical growth opportunity. While the transition may take three to four quarters, we believe it is the right time to invest and build strong delivery fundamentals. About international, we continue to scout for new opportunities in the international market.
We're looking forward to another big break similar to the Africa which we had. We intend to carve out a new team and invest in this direction, in fact. Only then we can pick up great business here. Since we now have experience and expertise to replicate, while the journey is slow, it will increase the opportunity to build better margin and increase our product portfolio along with the revenue growth. In terms of the next focus for FY 2026, because we have two more quarters, our focus is going to be completely on increasing revenue stream in payment platform, building new accounts, and executing business in TSP, generate SaaS-based revenue for RegTech and Bank in a Box, and increase merchant presence through new product which we launched in H1. My team has put all the efforts to put these details in presentation and floated for everyone's consumption.
I hope you have got that. Beyond that, if you still have queries, I'm here. My team is here. We can definitely take it from here. Harshil, over to you.
Yes, we are. The floor is now open to question and answer session.
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 touchstone 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 [Agrim Kanungo] from [AK Investment]. Please go ahead.
Hi, sir. Congratulations on a good set of numbers. I also.
That.
My question is, what is the expectation for the Q3 and Q4? And which segment will be integrated?
One second. Your voice is cracking. Am I audible, Harshil?
Hello.
Hello.
Is it better?
Just try saying that again.
Sorry. Is this better?
Yeah. Just try saying.
Hello.
Yeah, yeah. Tell me.
Yeah. So team, what are the revenue projections for the next two quarters? And what do you think which segment will be driving it, moving ahead?
I don't think I can give projections here, but there is an incremental growth for sure coming up. There is no doubt about it. Whatever we committed over the last few quarters, I think all the investors will have stayed that we are definitely doing it. What can drive us is for sure the incremental product portfolio that we have added in TSP. That's really picking up SaaS-based revenue around devices, around the payment portfolio that is picking up. We see that our Evok is also contributing in the coming quarters. That is also a really big contribution coming up. There are some new payments, new revenue stream which we have added, which will start kicking from Q4. Yeah, those are the areas that we'll be focused on.
Some of the accounts that we are focused on right now in the domestic and not very, I wouldn't like to call it right away, but yes, our focus is also there in the global side.
One final question is about the margins. Do we expect it to improve with the product diversification that is happening? Is there any recent product or any services which has a higher potential for increased margins for us?
We had a very high margin when the Evok was peaking. And as and when it goes up, for sure the margin will multiply.
Okay. Thank you. I'll fall back in the queue.
Yeah.
Thank you. The next question is from the line of Gaurav Didwania from Qode Advisors. Please go ahead.
Perfect. Thank you for taking my question. Congratulations, Deepak, on the great set of numbers. We also met earlier this year, and you had mentioned that sometime it will take for numbers to get better. I just have a question. Can you give us a split on the different divisions in terms of TSP, PPS, Reg Tech? What's the split of revenue that's there in each segment?
See, RegTech, we have just saved out, and we believe, like I clearly said, that another two to three quarters, for sure, we want to focus on it. More than revenue, we should see the value creation that RegTech is going to bring in. RegTech, let's not count that in the revenue today. We have a split on the TSP and PPaaS. I think the split around TSP would be around 80%, 85% odd, and the PPaaS would be around 15% odd.
Perfect. Earlier, you would also quote the numbers that you've done on the TSP side. Are you quoting those numbers again?
I'm not quoting that number now. No, no. I'm not quoting that number now because the revenue stream is not absolute to the quoted number. Our revenue stream is multiplying, so that will be very difficult for someone to calculate right now. Let's not speculate that.
Got it. Last September, the numbers were close to INR 66 crores. That's when the revenue had peaked. What time do you see us reaching those levels again? Is it going to take a couple of more quarters, or do you have some expectation in mind?
I think that's what I've already addressed. I think in the Q1 call, I picked up that point very clearly that looking at the funnel that we have, we believe that Q3 is where we will be hitting it. Like I said right now, we are working on that direction already, and we see it doable.
Perfect. I think that's it from my side. Thank you for taking my questions.
Thanks. Yeah.
Thank you. The next question is from the line of [Sajuk Gupta] from [Ethics Charity]. Please go ahead.
Hi, Deepak. I think it is [Sajjan Gupta], not [Sajuk Gupta].
Congratulations for a great comeback in Q2 for the results.
Thanks.
Excellent.
I see there's a huge potential in transaction entries, the SaaS-based business. I just wanted to understand the sustainability of this business. How do you see this part of the business picking up now? Because this was at one point of time 80% of our business. How do you see this business doing and the sustainability of this part of it?
Thanks for that question, [Sajjan]. If you see the presentation we have shared, we have clearly shown the growth potential the market has right now. We have clearly given the contribution of UPI over the entire digital payment segment in the country. That's more than 90%, in fact. There is no way that the volume will go down or there is any impact around it. We have built the entire payment platform with UPI at the center. Now, what we are trying to solve problem here is not just the scale, but also adding more value to banks in the CASA business, and at the same time, solve certain industry problems where there is a revenue potential, including early settlement, including the high success rate, including the interoperability. All of these brought together, there's a huge potential that we see coming up.
The volume here is in thousands of crores when it comes to solving these problems. Moreover, the entire segment is now well-regulated, well-structured. The regulator has brought in tremendous efforts to bring the entire pieces together in the last four to five years. I believe that will be a great advantage for the product that we have right now. Yes, it has a lot of potential. New revenue stream getting added. Volumes are multiplying. At the growth stage that we are right now, trust me, we will be growing. In fact, our growth rate will definitely be the multiplier of the entire industry growth rate. That is what I would like to say.
Okay. Wonderful. Deepak, the second question which I have in my mind is that we have a TimePay which is up and running right now, and we are not talking anything about it. Can you throw some light on this business? How many people have onboarded on this? Are we doing any burn on this part of the business, if any? Just about this.
Great. I mean, I got this question last year also. In fact, Sajjan, for Bank Pay, we have more than 1 million customer base right now. If we are not burning, that's not the model on which we believe. Our intention to touch base on Time Pay was to be on the merchant side of the business. I mean, how do we solve the problem around the merchant? Because that's where the revenue generation is. There are certain great products that we are launching here. This one is about PPI, where the great MDR coming up. Then we have B2B merchant products which we launched. We are the first B2B merchant app in the country. We launched it under NBBL, which is, again, an NPCI body. These are the cases which help us strive the opportunity in TimePay.
These are the areas where we are focused on. The incremental number around the user base is a byproduct of these kinds of initiatives. That will definitely open up gates and revenue opportunities slowly. I mean, that's where we believe.
Wonderful. You're saying one million customers are already onboard right now?
Yes.
That is without any burn which you are doing as part of the business?
Yes. Yes.
Wonderful. I think that's all from my side. Thank you, Deepak, and all the best for the future.
Thank you. Thank you so much.
Thank you. Bye-bye.
Thank you. The next question is from the line of [Harish Kumar Gupta] from [Nirmal Bang] Securities Direct Limited. Please go ahead.
Hello Deepak sir. Congratulations on good results.
Thanks Harish.
[Foreign language]. I am sure that it cannot go for long duration. [Foreign language]. Can be sustained for at least four, five quarters or something like that?
Great question. Harish ji, right? Correct. Sorry.
Yes. Yes sir.
Harish ji, thank you so much.
[Foreign language] Sorry, I'll mix a word—but these are all new opportunities where we are trying to look at new products like BBPS.
We were not there. We brought in BBPS. Bank in a Connect to focus on 2,000 banks where we did not have traction at all. That was the traction we built in. [Foreign language]. T hese are all the vision and the push which the payment and the digital banking industry has right now in India.
[Foreign language].
Okay. Okay. [Foreign language].
Yes. [Foreign language]. Will definitely help you understand business better. [Foreign language].
[Foreign language]. Not 40% quarter on quarter, but at least double year on year, [Foreign language].
Sir, [Foreign language] we have published a report. The report is very clear where the analysis is from RBI, PWC, industry analysis . [Foreign language] today the UPI is at 20 billion per month, and it will go to 60 billion. Almost 300% growth in next four years.
This is not going to taper down. [Foreign language] user base, yes, absolutely right, user base around urban India and semi-urban India has been well captured. But taking this to semi-urban and rural India, [Foreign language] It's not short. It will take time.
Okay. Okay. Thanks for clarification. One last question. [Foreign language] how big this international opportunity you see it? Like it is in multiple of India's opportunity or small scale?
Sir, ticket revenue per ticket is definitely much larger than India. [Foreign language] the contract size is also larger because there the size of one state or one city in India is as big as the country itself. [Foreign language] considering the problem that they want to solve. [Foreign language] because we have also ventured new. For sure, the initial traction and whatever we have got as a feedback, the size of the contract and the revenue per ticket, [Foreign language] paying ability to pay or I would say that the [Foreign language].
Okay. Thank you. Thank you.
Thank you. The next question is from the line of [Neeral Gangal] from [Neeve Financial Services LLP]. Please go ahead.
Hello. Congratulations on great set of numbers. I would congratulate also that you achieved what you promised. That is very good because what you have said is done. Okay.
Thanks. Thank you so much.
On the new products, I wanted to understand a little what are those products? If I have missed maybe at the start, you would have said that is one question. Second is I wanted to understand the receivable cycle because what I am seeing is 115 days close to receivables of sales outstanding. I do not understand why is it so high in our service industry?
When it comes to product, I think I'll shorten it down because I think I have already experienced a couple of times. Product may, there is Banking Connect, which is about bringing interoperability in net and mobile banking. All the products that we have, UPI, IMPS, Super App, BBPS, all of that, we are creating a hosted ecosystem we have created, in fact. We have deployed that in our environment, and we are giving it as Bank in a Box. That means a short plug and play, fast DTM, low-cost model for mid to small-sized bank. These are major.
When it comes to payment platform, December end to early January is where we'll be launching a new version altogether, where we are solving problems around early settlement, and we are solving problems around interoperability and autopay and payout. This will open up gates for multiple new target audience. In summary, that's the product. There is more to it. I'll touch base on the second question straight away. Four quarters, our shift from payment platform to TSP is completely de-risking and diversifying our business. That is what we have done. What has happened by the nature of the business and the billing cycle that we have, we see that our cycle is lengthier compared to what we initially had in payment platform, where the cycle was literally running in within months.
Now this is somewhere like 60-90 days old. So that will settle down as and when we grow, as and when we have more and more multiplier to it.
Okay.
Big differences last year, obviously.
Great. Thanks. That was my question.
Yes. Thanks.
Thank you. The next question is from the line of [Anand Kumar], an individual investor. Please go ahead.
Thanks for taking my question. Can you hear me?
Yeah. Tell you.
Okay. A couple of questions. First one is when this MDR is sticking, right, to say it in the credit card or in the credit line, this will be margin equitative or there will be margin dilutive?
Can you repeat that? When MDR?
When the MDR sticking for the credit card and the credit line business, will they help our margins further grow or will they contract our margins?
No, no. It will increase the margin because right now we do not have the line of revenue coming in from credit card on UPI or credit line on UPI. As and when the traction increases, right now the credit card on UPI, if you go to a merchant today and you transact on your credit card on UPI scan and pay, then there is an MDR which gets generated. Now that will multiply as and when the customers using credit card over UPI will multiply. So that revenue is not accounted yet. I mean, that growth will ultimately give a growth to the merchant revenue, which will add up to the interchange income of our customers. So that will obviously kick in. Same way, credit line is long-term. It will still take time.
The question, I don't remember, I guess Harish ji, from him was majorly around the UPI going down next three to five years, what are the potential? Credit line is again a great long-term potential wherein lending-based impact in the ecosystem will kick in, and that will generate a lot of revenue. Of course, MDR is one of that.
Okay. So summary Deepak, what you are saying is that once these two products kick in, right, revenue for sure will go up, but there will also be more margin accretive as well.
Absolutely. Liquidative margin, incremental revenue.
Okay. The second question, I believe, which is completely on the opposite side is on the foreign side, this Africa business and this Dubai business, will the revenue when I want to just start, will that be in the TSP side or will that be in the PPaaS side?
The Africa entry was the TSP side, but it's more of salaries revenue where after implementation, we get a fixed set of revenue every month. In Dubai, we have just opened the operation, and we are participating in a lot of inquiries right now. We are trying to see how quickly we can close some of the accounts. I hope what we have done in Africa is what we will try to do in UAE or the Southeast Asia market.
Deepak is saying it's mostly the TSP, but in the SaaS more?
Yeah, TSP, but it's a hybrid one where we get paid for the delivery implementation, and then there is a monthly revenue coming in.
Purely from the number of banks perspective, right, like if we do not have that much exposure to the Africa business, will they be similar to the Indian number of banks or are they like half, one-fourth?
No, no. So honestly, the territory that we operate in, you have 10-20, that's the number of usual banks. And then like we have cooperative segments here in India, cooperative bank segment, you have very small accounts there. Like the size of credit societies that we have in India is the size of cooperative banks that they have. Yeah, that's the major because there again, it's a concentration of business amongst top 10, top 20-odd banks. That is what you'll see in India account also. The huge concentration around PSU private sector banks. You can consider that mix for any global market.
Okay. Just trying to sneak one more question if operator allows. Yes, I think this is follow-on to one of the other gentlemen asked you. Outstanding the growth, right, like 50%, 40%, 50% quarter on quarter is absolutely like in the dream size is not possible. If you have to draw like a five-year vision, what would you draw for yourself, Deepak?
I mean, honestly, there is so much potential left in it, but it's more of the combined effort of my team and everyone put together because we see huge potential across the segment. That was the reason why we wanted to educate our shareholders very clearly. We broke our entire target segment. We gave the clarity on the potential industry growth, the CAGR growth for the next four years, the absolute growth for the next four years in each segment. If we intend to capture that area, for sure, this kind of number is not impossible, but the kind of re-engineering, reinvention, rethinking, and the effort required by the organization will be humming with. All that put together is where numbers should be there. I mean, yeah.
Okay. Thanks, Deepak, for taking all the questions, and we wish you good luck for the future. We really want to tag along with you for the foreseeable future.
Thanks. Thanks.
Thank you. The next question is from the line of [Abhishek Sharma], an individual investor. Please go ahead.
Thank you. Thank you for the opportunity.
Thanks, Abhishek.
The first question is that TSP has chosen all three years like TSP, PPaaS, and RegTech. Which vertical is expected to drive the highest incremental revenue over the next [audio distortion] 18 months?
Which vertical is expected?
I mean, which vertical is expected to drive the incremental revenue over the next 12- 18 months?
I would say at top will be TSP and PPaaS because that's more mature. TSP for sure is definitely there. PPaaS will again be an absolute multiplier. RegTech, I think maybe six months later, we'll have to really look at how it is shaping of the market. If you ask me 12- 24 or maybe 18 months later, then for sure the maturity curves for PPaaS and the RegTech will definitely be much better contributor.
Okay. Okay. Okay. My second question is, how is the company balancing its growth between SaaS-based recurring revenue and implementation-led revenue?
To focus on that balance, if you see the business updates slide that we are giving, on one side, we are calling out the areas of investment where we are focusing on SaaS-based revenue even in TSP. On the other hand, we are also talking about launching new initiatives which will add more revenue to PPaaS. That is majorly to focus and increase the share around SaaS. I would say we have enough business around TSP, and SaaS is where we are also focusing right now. That is why all the products brought into a single box and then seeing how we can monthly generate revenue out of it.
At the same time, per pay-per-use model for all our products, right from RegTech to PPaaS to even Bank in a Box or to any new launch that we are doing right now, even voice payment that we launched, all of them are built on pay-per-use or in [audio distortion] . I think it will take some time to bring a fair sum of balance, but that's the effort that we have already poured in maybe a couple of quarters.
Okay. Okay. Great. How is our company's upcoming RBI and PCI compliance with changes or especially around data localization and digital lending guidelines?
We are not in lending. Neither we have product around that right now. If it is UPI-led, that's where we are focused. When it comes to data localization and all, I think if you are referring to regulated entities, we are not the regulated entities. However, being a TSP and being core to my customers who are all regulated entities, all our systems are rightly driven as per the RBI compliances. That's never a challenge. We have our internal risk committee. We have our audit committee. We have a CISO in the organization. All our products are compliant as per the banking guidelines. Without that, we can in fact, that's the fundamental basics. Without that, we cannot even sell the product in the market.
Okay. Right. Okay. Fine. That's it from my side for now. Thank you for answering. I'll get back into the queue, right?
Thanks.
Thank you. The next question is from the line of [Srinivasu K.] from [TIA]. Please go ahead.
Hi, sir. Thanks for the opportunity. My question is, recently, one of your competitors, like Paytm, introduced AI-based sound boxes with analytics to help the merchants. Are we also thinking about this kind of AI-based intelligence in our drinks product?
Yeah. So the problem, see, we actually wanted to solve the problem around the fraud analytics, which we have been able to bring in very well in the RegTech segment that we have already done. When it comes to sound box business, the model in which Paytm operates, they will be investing their own money to deploy sound boxes across merchants and generating revenue out of it. Our model is purely based on providing our device as a service platform and devices to our customers. They deploy it, and they pay us. It purely depends on the demand, which will keep multiplying over it. If Paytm has taken that step, it's great for the market because it will start calling out for the innovation, and it will start calling out for such kind of requirement in our products as well.
As and when the demand starts pouring in, as and when our customers start requesting for it, our innovation lab will definitely add to it and give it to the customer. I mean, right now, it's all about looking at the size of the market. Each of these accounts have rights from Central Bank , IOB , all these customers, and then deploying the sound box. The next level will be scaling it to the new designs like AI that you mentioned.
Okay. So then what was the initial, in your initial remarks, you talked about working on AI?
RegTech.
I see. I see. Okay. Another question.
AI for our internal efficiency is what I mentioned so that we can increase organizations' productivity and faster GTM when it comes to deliveries and scaling the organization's competitive advantage. That is internal to us. Second is, obviously, when it comes to product or the market, RegTech is where we are focused on, which is about fraud prevention.
Okay. Okay. Just to follow up on that, there is a lot of buzz in recent GFF that there is a conversational commerce within apps like ChatGPT. If discovery and checkout happens inside this ChatGPT agent, then banks and merchants also, merchant acquirers will also want these agent-ready APIs, right? What is your plan? Are you thinking in this direction also? Or is it too early?
I mean, that will be like another, so assume that you are currently transacting on Amazon or Flipkart. Tomorrow, you have ChatGPT with you, and you're transacting on ChatGPT. That's the new platform that will get created. However, the payment requirement of a merchant still remains. For us, I believe that it's more about the merchant ecosystem where we exist. Secondly, payment links, payment being derived over ERP. These are the areas where we have already invested. We are already stepping into those directions, like payment over WhatsApp, payment over SMS, payment over voice, IVR. These are the areas which we have already caught. Payment over ERP. These are all additional efforts that we are pouring in. That's why I said that we are re-engineering, and we are bringing absolutely new products to the market by maybe early next quarter.
Okay. Thank you. Best of luck.
Sure.
Thank you. The next question is from the line of [Ashish Soni] from [Family Office]. Please go ahead.
How much of impact you had because of the gaming ban on your UPI transaction revenue, sort of?
We had zero merchant on gaming—what do you call it? Gaming MCC. We did not have any. I believe the impact will be more on the payment aggregators than us. We did not have anyone right now from any of the payment aggregators on our platform. I think that clarity we have very clearly given on the share market. I mean, to the NSE, we uploaded that.
Okay.
I believe there may be an industry-wide impact where there can be a sense around it. When it comes to very specific, I would say no.
Okay. You are using AI internally. How much of cost optimization or profit improvement can it give to the company in the next two, three years?
Our goal is to optimize by about at least 40% when we began about two quarters back. I mean, we're thinking about it when we built it. I believe our calculation may be misjudged. When it comes to two to three years, it will be much larger than the 40% goal that we have. That's the lowest that I think we should consider.
In terms of percentage points of the margin, how much can it boost up the margins in two, three years?
Due to AI?
Yes. Internally, we are using AI, right? Employee cost will come down.
No. More than that, we should see that the employee—so it has two impacts. One is, today, if I'm doing some delivery to my customers with 100 man-days, and I have a revenue coming in for 100 man-days, now my competitor may end up doing it in about 50 man-days. If I'm still sitting at 100 man-days, then I have lost the competitive edge. I believe that it cannot be an absolute figure. We need to understand that when the entire ecosystem moves towards AI-based development, then the efficiency is across the industry. I believe that the efficiency will definitely be there, but it will be not so high. In fact, what will happen is your delivery per person will multiply. That is definitely going to happen. Your revenue, when it comes to for a particular change request, that may go down.
You end up taking more business. If my competitor is doing it for 50 man-days, my job is to bring it to 40 man-days from 100 man-days. That is one area that we need to look at immediately. Improving cost efficiency will not directly add to the margin. Yes, I would say that margin will definitely improve because of AI.
One last question. Government is thinking of merging the public sector banks, a few of them together. Will that give a flip-up to whatever base business initially you had in future?
Honestly, I've also read in the articles, and I'm also reading more about it as and when I go to my customers. I have not got much insight into it. Consolidation will definitely help the entire banking fraternity, or I would say that the banking pillars that we have in the country. At the same time, the incremental demand for digital products, that will be very high. I mean, although there will be consolidation, you cannot expect that one single vendor will have an ability to manage 20% of the country's entire population on a digital platform. There, you need to have a very different method altogether. RBI talks about de-risking your entire technology stack, your entire business, bringing in redundancy. I would say that it's way too early for us to comment.
That's the situation right now, wherein the incremental digital demand will pump up for this banking segment.
Okay, sir. Thanks and all the best.
Thanks.
Thank you. The next question is from the line of [Shilpa Nayak] from [RT Finance]. Please go ahead.
Oh, yeah. Thank you for this opportunity. So my first question is, NPST recently won an order from a large PSU bank with 3,300+ branches. So what portion of this is expected to be recognized as revenue in FY 2026?
This is about the Coins Platform where we are selling our product on a device-as-a-service model. I would say that we have just got it. The execution will take this quarter very well. The incremental scale will come in the next financial year. This financial year, we will be able to move maybe 10%-15% of the total order, not much. I think we should look at the next financial year.
Okay. So my second question will be, what is the average implementation cycle for Banking Connect and Bank in a Box?
Bank in a Box is targeted to be less than 30 days, 30 to or maybe even lesser than that. Banking Connect, depending on the if at all it is Bank in a Box. So anything that we bring in Bank in a Box, our intention is to be 30 days, 30-45 days flat for these products. Banking Connect, if launched in Bank in a Box, it will be 30-45 days. When it comes to large banks, it can take about 90-120 days.
Okay. Thank you for that. That's all from my side. Thank you for questioning that. Thank you.
You're welcome.
The next question is from the line of Prateek Chaudhary from Saamarthya Capital. Please go ahead.
Sir, more on a slightly longer-term potential for our Taipei app. You had briefly mentioned on MDR potentially being introduced for PPI. I just want to understand what is the current status in terms of the approval of this or where the industry is at in terms of agreeing to this or from the NPCI level. Say two years down the line or three years down the line, when we would have much larger consumers on our app, what might it mean? I understand even this MDR will be shared between the acquirer, the issuer, and the bank and the app. Any broad thoughts on where are we in terms of this getting implemented by NPCI or the government, and what it could mean for us in the next two, three years?
Yeah. MDR exists. It is not that it will be launched. It exists in minus UPI. Every product has MDR, CC, or PPI, or credit line. Everywhere there is MDR. It is just that UPI being such a mass focus and solving such a big infrastructure problem across various parts of India. That is a different pointer altogether. PPI, when it comes to solving very specific use cases, which comes to solving wallet-based transactions, MDR exists around it. That is not a new thing. Our intention here is to see how we can be on the B2B side of the business with this particular product. In a sense, are we able to capture the wallet-based transaction in the corporates? Are we able to capture the wallet-based transactions in the ERP segment? That is where we intend to introduce PPI.
That is how we want to explore the opportunity in TimePay rather than simply distributing cards or simply running behind cash zone on the user acquisition side. It is more about tying up with the potential corporates, tying up with the large entities where we can solve quick payments with the wallet-based transactions. That is leading to the MDR revenue in the ecosystem. I would say that in the next two to three years, this will be one of the key contributors in the PPI revenue source that we have. I mean, of course, I cannot give the number right now because it is just launched. It is not good to start putting the numbers to it. We have already got the order from one of the ERP vendors. We are working with them.
One stage, if we are done, we have got great success, then we'll start multiplying it with the other ERP vendors in the country.
Okay, sir. Thank you for your response.
Yep.
Thank you. As there are no further questions, we have reached the end of the question-and-answer session. I would now like to hand the conference over to Mr. Harshil Ganshyani for closing remarks.
Yes. Thank you, everyone, for joining the conference call of NPST Limited. If you have any queries, you can write to us at [research@directkirinadvisors.com]. Once again, thank you, everyone, for joining the conference call.
Thanks, Harshil. Thanks, everyone.
Thank you. On behalf of Kirin Advisors Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.