Good evening, ladies and gentlemen. I am Sejal Tripathi, your moderator for this conference. Welcome to the conference call of Route Mobile Limited, arranged by Concept Investor Relations to discuss its Q2 and H1 FY 2025 results. We have with us today Mr. Rajdipkumar Gupta, Managing Director and CEO, Mr. Gautam Badalia, Group Chief Strategy Officer and Chief Investor Relations Officer, and Mr. Suresh Jankar, Chief Financial Officer. At this moment, all participants are in listen-only mode. Later, we will conduct a question and answer session. At that time, if you have a question, please press star and one on your touchtone keypad. Before we begin, I would like to remind you that some of the statements made in today's earnings call may be forward-looking in nature and may involve certain risks and uncertainties. Kindly refer to slide number two of the presentation for detailed disclaimer.
Please note that this conference is being recorded. I now hand the conference over to Mr. Rajdipkumar Gupta. Thank you, and over to you, sir.
Thank you. Good evening, everyone. Season's greetings to all of you and your respective families. I'm pleased to say that Route Mobile has achieved its highest revenue to date, even though Q2 is typically a slower period for us. With the months of July and August being holiday season in many parts of the world, we usually see a dip in activity. However, despite these seasonal challenges and the ongoing geopolitical issues, we have delivered approximately 10% revenue growth and over 20% EBITDA growth year-on-year basis. Looking ahead, with the festive season approaching, we expect to see a strong increase in revenue and expanded margin, and we remain confident in meeting our guidance for the year. In terms of business momentum, we had some solid deals in this past quarter, along with continuous progress in realizing synergies with Proximus Group.
Here are a few key highlights: We signed a significant deal in September with global e-commerce company to cover multiple regions. Traffic has already started and will ramp up over the time. Proximus and Infosys formed a long-term strategic partnership, which combines Route Mobile CPaaS solution, TeleSign DI services, and this offering with Infosys digital services. This partnership, following the Microsoft deal, strongly validates our group synergies. We're also working on several other long-term partnerships that we believe will drive significant value to Route Mobile. Beyond these group synergies, we have laid out a clear roadmap. We are already receiving additional traffic from TeleSign on routes where Route Mobile offers clear advantage in price and quality. Our cross-selling efforts are well underway, and we anticipate revenue momentum to follow shortly. We have launched our shared service initiative this past quarter and expect to see rapid progress in this area.
We also continue to lead in the metro ticketing space and with a new development for Maha Mumbai Metro. Additionally, we have implemented a WhatsApp-based utility communication service for IRCTC. Our new product revenue are showing strong growth, up by 32% year-on-year basis. A few other highlights since Q1 FY 2025. Route Mobile was named Leading Partner of the Year 2024 at the Meta WhatsApp Business Summit in India. Proximus Opal successfully completed its offer for scale to meet minimum public shareholding criteria. This attracted strong interest from long-only funds, and we are grateful to our investors for their continued trust. We will remain focused on delivering value for all our stakeholders. Lastly, based on our strong performance in the past 1/2 of FY 2025, I'm pleased to announce that Board of Directors has recommended an interim dividend of INR 6 per share.
With that, I will hand it over to Gautam to go over the financial highlights. Over to you, Gautam.
Thank you. Thank you, Rajdip. Good afternoon, everyone. Season's greetings to all of you. We have already uploaded our quarterly earnings presentation on our website as well as the stock exchanges websites. Hope you had a chance to go through the presentation. I'll quickly summarize our financial and operating performance during Q2 FY 2025 and H1 FY 2025 opening the floor for Q&A. The quarter gone by has been a good quarter, considering the seasonality of our business. It is our best quarterly revenue till date, and with festive season ahead of us, coupled with incremental synergy benefits, we are reasonably confident of meeting our guidance for the year.
Our revenue growth in Q2 FY 2025 was impacted marginally due to two reasons: continued weakness in digital messaging, owing to geopolitical issues in Continental Europe, and our ILD revenue in India was impacted for a few days in August, mainly due to our firewall software upgrade, as well as there was an infrastructure issue with the virtual machines at the cloud host. Things have completely normalized since then. For H1 FY 2025 versus H1 FY 2024, we also had a significant currency impact owing to Naira's devaluation, which is the Nigerian currency. Now, talking about a few growth levers. So we had a few growth levers that should pave a strong runway for us over the medium term. The one that Rajdip talked about, winning a large e-commerce deal, as mentioned by Rajdip, which should ramp up gradually.
Then we are also working with strategic partners like Infosys to accelerate our sales lead cycle. And very recently, we've also participated in a very large global RFP as part of the Proximus Group synergy. So if that RFP were to fructify, that should add significant layer of growth, I mean, for the coming years. The key highlights for H1 FY 2025 has been the strong cash conversion from EBITDA, which panned out to be 78%. In terms of key business metrics, in volume terms, we processed INR 40.5 billion billable transactions in Q2 FY 2025, which is again the highest quarterly billable volumes processed by us till date. Billable transactions increased from INR 31.3 billion in Q2 FY 2024 and INR 37.1 billion in Q1 FY 2025 to INR 40.5 billion in Q2 FY 2025.
Average realization per billable transactions marginally decreased from 29.7% in Q1 FY 2025 - 27.5% in Q2 FY 2025, owing to increase in domestic volumes in India and partly due to the ILD revenue impact as stated above. In terms of geography, India continues to be our largest market by termination, accounting for 51% of our revenue by termination. You may refer to slide 11 for the same. We continue to witness very strong momentum on the next generation products, which grew by 32% on a YoY basis, as referred in slide nine of the presentation. With this backdrop, let me walk you through our financial performance.
In terms of Q2 FY 2024, Q2 FY 2025 performance, revenue from operations grew by 9.7% from INR 101.46 million in Q2 FY 2024 - INR 111.34 million in Q2 FY 2025. Gross profit margin declined marginally from 21.2% - 21.1% due to the related party transactions, which happens at a lower gross margin. Reported EBITDA grew by 5.5% YoY from INR 12.81 million in Q2 FY 2024 - INR 13.52 million in Q2 FY 2025. There was a sequential growth of 9.3% during the same period. EBITDA margin expanded from 11.2% in Q1 FY 2025 to 12.1% in Q2 FY 2025.
The increase in finance cost was primarily due to the full quarter impact of a loan availed during the month of June 2025. Effective tax rate for the quarter was 23%. Profit after tax grew by 21.1% YoY from INR 884 million in Q2 FY 2025 - INR 1,070 million rupees in Q2 FY 2025, as compared to INR 812 million in Q1 FY 2025. PAT for Q2 FY 2025 includes exceptional item gain of INR 62.8 million, which is net of the fair value gain on the contingent consideration and recognition of impairment loss of goodwill pertaining to MRN. PAT margin was 9.6% in Q2 FY 2025, as against 7.4% in Q1 FY 2025.
We onboarded 56 new employees, and 45 employees left us during the quarter gone by. For H1 FY 2025, revenue from operations grew by 11.9% from INR 1,981.9 million in H1 FY 2024 - INR 2,216.8 million in H1 FY 2025. In terms of certain KPIs, billable transactions increased from INR 60.8 billion in H1 FY 2024-INR 77.6 billion in H1 FY 2025. We had a net revenue retention of 105%. You may refer to slide 13 of the earnings presentation. We added over 300+ new customers in H1 FY 2025 across all products. Gross profit margin increased marginally from 21.3% in H1 FY 2024 to 21.4% in H1 FY 2025.
EBITDA grew by 6.1% on a YoY basis. EBITDA margin contracted marginally from 12.9% in H1 FY 2024- 12.2% in H1 FY 2025. Effective tax rate for H1 FY 2025 was 22%, as against 16% for H1 FY 2024. Profit after tax grew by 4.5%. PAT margin declined from 9.1% - 8.5%. Cash and cash equivalent stood at the end of the quarter at INR 11,145 million, and net cash was INR 5,836 million as on September 30, 2024. Average receivable days stood at 79 days, and average payable days stood at 69 days. Cash flow conversion in H1 FY 2025 was very strong at 78%.
With these highlights, we open the floor for Q&A.
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 Amit Chandra from HDFC Securities. Please go ahead.
Yes, sir. Thanks for the opportunity. So the first question is on the margin guidance, that you have said that you are maintaining the margin guidance, but the ask rate for the second half is quite steep. So considering now we have festive season in quarter three, you know, what... Apart from that, what, you know, gives you the confidence to achieve more than the 10% sequential growth rate for the next two quarters? Is it, you know, the Vi deal, which is already in the base? So apart from that, which other, you know, deals will start to contribute, or is it, you're seeing revival in the base business?
And also, you know, in terms of the synergies that you mentioned, that you have seen some synergies coming from TeleSign. If you can, you know, like throw some light, are we in the early stages of the synergies or we can see that to be a, you know, to be a major contributor to the growth going forward?
Hi, it's Rajdip here. So as we, as I stated in my statement also, like, we are very much confident that we will achieve the guidance which we have given to the market. By looking at the current run rate for this quarter also, I think we believe that we will achieve the numbers which we have guided. Because in the festive season, we definitely add value to our revenue. As far as the synergy is concerned, we are working very closely with TeleSign as we speak. And as Gautam has mentioned, there is a very large RFP which is now been floated, and we have been invited to participate in that RFP. There are multiple deals like Infosys, as well as the Microsoft deal. Kind of deals are already in the pipeline.
So we are very much confident about the guidance, and we are working towards that, and we will definitely try to achieve that. And we believe that we will achieve that. Gautam, you want to add anything to this?
Yeah. So, just adding to what Rajdip said, I think, historically, I mean, seasonality has always played out. I mean, typically it's 45%-47% H1, and balance, I mean, happens to be H2. So if that were to play out, I think we should be, I think, in that touching distance of the guidance that we have given. And, a lot of this growth that we are talking about should come without any additional overhead costs. I mean, so that is the operating leverage, I mean, should play out, and that should lead to the margin expansion. So in the past, I think we have been able to kind of deliver significant, I mean, expansion on EBITDA margins during H2.
So I think some of those things are, as Rajdip mentioned, I think the run rate today, I think for this quarter, seems very, very promising, and hence, we are reasonably confident that we should be able to kind of meet the guidance that we have committed.
Okay. So in terms of the, you know, Vi deal, you mentioned that there were some, you know, headwinds in terms of, you know, some of the, like, issues with the, like, acquisition and with some of the, like, you know, AWS issues. So, ex of that, what is the, you know, the current run rate? And also, where we are in the journey in terms of, you know, hitting a steady state in which, we were earlier, the full, like, potential of the deal was INR 100 million, which is INR 800 crores, but still we are just, you know, like, 1/2 of that in terms of the full potential. So, when we expect to hit the full potential in that deal?
The infrastructure issue was, I think, for a few days. I mean, it's about seven days impact, I think, in terms of the ILD revenue. But everything is kind of working fine now. I mean, we have the sale with Amazon. I think everything worked at scale, I mean, from a platform standpoint. There is no concern whatsoever on that. From a Vi deal standpoint, I think we are on track in terms of the values that we've committed. We believe, I mean, we'll be able to subsume the entire commitment, I mean, during the course of this year.
Okay. And in this quarter we had, you know, like, volume jump. So I assume that the ILD volumes were mostly stable to on the positive side. But there was a sharp, sharp drop in the realization. So is there a change in mix which has caused that, or you know-
No, so the ILD volume was marginally impacted, as I said, I mean, because of those seven days. So to that extent, I think there was a little bit of an impact on the ILD volume growth. But the domestic volumes had ramped up. So, and it's because of the mix, I mean, got skewed more towards domestic versus ILD. And hence, I mean, the realizations kind of had a kind of a little bit of an impact.
Okay. Okay, so thank you. I will be back in the queue. Thanks.
Thank you. The next question is from the line of Nikhil Choudhary from Nuvama Wealth Management. Please go ahead.
Yeah, thanks for the opportunity. My first question is regarding the growth. In last quarter, the incremental revenue which we have added is approximately INR 100 crore, right? In the first half of FY 2025. This is broadly in line with what you have guided in terms of revenue synergy, plus Vodafone Idea site, right? So can you help us understand that, you know, in first half, we haven't seen much growth in organic revenue with just 10DLC in first half FY 2025. What gives you confidence of such a high single-digit kind of growth to achieve lower end of guidance? That too, when missed in messaging and messaging which forms, if I'm not wrong, 15%-20% of our revenue, having its own challenges. Thank you.
So, Nikhil, I think we have registered almost in H1 you are talking about, right?
Yes, yes.
H1, I think we had almost 11.9% growth, right?
So my point was, Gautam, a good part of it should be could have come from within your synergy as well as Idea. So ex of those two deals, which both are now in H1 base, how you will be able to drive the growth, with when, you know-
No, no. So I think, so let me clarify a few things here, Nikhil. I think what is happening is, so TeleSign was already kind of part of our organic revenue, right? So whatever incremental revenue that we have got, I think, from TeleSign during the course of last quarter, that could be attributed to the synergy. But a large part of the TeleSign revenue for H1, I mean, pans out to be part of our organic growth, organic revenue, so to say. And from Vodafone, essentially, I mean, the deal is where they are the suppliers, so we are actually monetizing their infrastructure with the customers.
So whatever growth that you're seeing is actually coming from customers, where we are getting the benefit of the pricing and quality because of the commitment that we have with Vi and the exclusivity that we have on the network because of the firewall.
Okay, Gautam. But just continuing with the thesis of what will happen in the second half, where at least Vodafone Idea will be in place, and M.R. messaging continue to impact us or continue to drag our revenue growth?
Sorry, I didn't get your query.
So next two quarters, required run rate to achieve lower end of our annual guidance is at least highly significant, right? That means we have to grow on a 100% basis despite Vodafone Idea deal in our base, right? So no more benefit from Vodafone Idea deal. So where you think we will get such a high double-digit kind of growth despite our-
Nikhil. If you see our numbers also, our domestic volume is also growing. We have, because of the festive season, because of some of the large e-commerce platform companies using our platform, we have seen a huge amount of growth in this quarter, in fact, in this month. And because of the festivity, you know, festive season, we've seen lots of other brand also using our platform very aggressively. As far as the ILD is concerned, plus the domestic traffic as well. So we do see lots of growth will come from the existing customer. At the same time, we already signed some, a few large customer whose traffics are already started coming to our platform. So based on those, you know, like, numbers, we believe that we are right back. And there are definitely some synergies.
We are working with the TeleSign also. As Gautam mentioned, the entire synergy was not there in entire H1 . The entire synergy will be there in this H2 for sure, and where TeleSign and Route Mobile work very closely to get more traffic from TeleSign.
Mm-hmm. Okay. Can you give me just color on MR Messaging? What update there, and what are our plans going ahead?
M.R. Messaging, I think right now, they are kind of grappling with a little bit of issues around some of the markets, I mean, which were strong markets for them. But having said that, I think the basis, I mean, the clients that they're talking to, I mean, some of the deal wins that they have, I mean, they are already kind of alluding to a decent growth, I think, coming through in Q3. And at the same time, I think we as a team are now working together in terms of integrating and optimizing a lot of cost, I mean, within the Route Mobile umbrella.
So some of those, I think, benefits will start to kind of play out from this quarter, along with, I mean, some amount of growth also coming back into the MR Messaging's revenue numbers.
Sure, Gautam. Thanks again for the opportunity, and good luck for coming quarter.
Thank you. The next question is from the line of Dipesh from Emkay Global. Please go ahead.
Yeah, thanks for the opportunity. A couple of questions. First of all, just want to get sense about new product. Now, WhatsApp has already done some pricing, basic utility message and all those stuff. So if you can provide that sense, and RCS also from monetization perspective. So if you can give some broad overview about how this new product things is playing out, because it has some kind of implication on our base business also. And second thing is how we are participating in overall growth opportunity. Second question is about some of the large deal which you announcing, partnership with Proximus Group, Microsoft, Infosys, and I think one of the large global RFP, I think in your prepared remark you mentioned.
So if you can provide some sense, what would be the role of Route and what would be the role of parent, and how one should understand the overall dynamics? And last question is about gross margin. Now, I understand because of ILD loss of revenue, it could have implication on revenue, but it ideally should benefit your gross margin. Now, if I look, gross margin is still down, despite some benefit of mix change in favor of domestic traffic. So if you can help us understand how one should look gross margin from million dollar perspective. Thank you.
Sure. So I'll answer the gross margin query first. So I mean, because of the related party transaction, I mean, this full quarter, I mean, we recorded the entire throughput between TeleSign, BICS, and Route Mobile as a related party, which was kind of indexed at a lower gross margin than the portfolio margin. So if you adjust for that, I mean, there would be a gross margin expansion that would play out. Coming to, I think, WhatsApp, I think on WhatsApp, we have seen almost 20%+ kind of a volume increase on a quarter- on- quarter basis. And on a YoY basis, we've increased - we've witnessed about a hundred percent kind of pricing volume increase, I mean, on a YoY basis.
So you're right. I think WhatsApp has kind of reduced the pricing, I mean, for some of these utility messaging and stuff. So that had a little bit of a negative kind of an impact on the revenue.
I think, it has just been done, I think, I think the starting of the month, it's not been included in last quarter, I think, or maybe the beginning of the last, month. But I think, apart from that, I think there's another question, related to... Can you just repeat the second question, Dipesh?
Yeah. So overall, let's say WhatsApp, because of pricing reasons. RCS is also where monetization has started to pick up. I just want to get broad sense about this new product portfolio.
... So let me just clear one. Let's go one by one, Dipesh. It's better like you ask one question and we answer one question, and then you go to the next question. That's better for our clarity. So on, in terms of RCS, I think in Route Mobile, like, some of the use cases which we have deployed with our customers are completely based on a conversational base. We are not looking as a company to try to build a traffic which is promotional type of traffic. We really want to build use cases which will solve the customer problem, whether it's your metro ticketing option, which we have built for various metros in India.
I think, and we have deployed conversational commerce kind of solution also, where people can buy tickets within their WhatsApp Bot as well. So we are focused henceforth completely going to be on the use cases where we can build use cases where we can actually solve customer problems and basically on a conversation side. We will not get into those promotional kind of activities through RCS or even through WhatsApp. And for it promotions, for RCS and WhatsApp is not the right channel to do a promotion on that, and we still prefer SMS is the right channel to do promotion on that end. So that's our strategy as of now, and we will continue to follow this, because we really want to build a sticky business for long term, where we try to solve customer problems through our solutions.
No, understand. So let's say if I look, overall ecosystem perspective, new product for us is somewhere around INR 78 crore. And as a percentage if one looks at it, it is still in, single- digit kind of thing, somewhere around seven odd percentage. It is inching up, but it... pace of that increase is fairly moderate. That is what I try to understand. Now, partly because of price changes, obviously has implication despite a 100% volume growth for YoY, its revenue growth might be lower than that number. So if you can provide some sense, apart from these two channels, what other area where you are seeing promising signs of growth in this new product side?
So there is a difference, I think.
Yeah. Go ahead, Gautam. Go ahead, Dipesh.
So, because I think one thing where we have kind of extensively worked with the, and now we have reached to all the market-
Mr. Gautam, sir, we are not able to hear you.
Am I audible now?
Yes.
Yes, sir.
Yeah, yeah. So what I'm saying is, one area kind of indexed ourselves, I mean, on the cross-selling synergies with the group is we have kind of mobilized, I mean, our sales teams across the group to start powering the sales of the new products, especially the WhatsApp Business messaging and all the IP Messaging, and to large groups.
There's a problem. I think we can't hear you properly.
Okay.
Sir, I'll connect you again.
No, just Dipesh to answer your question what Gautam was trying to highlight out here. So we as one team, at, between TeleSign and Route Mobile, now we have started working very closely with sales team presence in all different regions, especially Asia. I think you might be aware that there are multiple events we are doing jointly with TeleSign in Indonesia, in Singapore, in Malaysia and now in Middle East and Europe also. So this is also giving a lot of traction with the customer who are actually using TeleSign products by either on DI or SMS. And I think we are reaching out to all the customers which have been served by TeleSign to offer our email and WhatsApp and RCS services through our platform. I hope I'm able to answer your question.
Understand. Last thing, if you can give some sense about progress on some of these large deals. One deal which you said around large e-com, ten destination kind of deal, where we are in that? Because the earlier quarter, I think progress was slow, whether you are seeing any material uptick there, and Microsoft, Infosys, even large global RFP which you highlighted.
Yes. So I think. As I mentioned at the beginning, we are very much integrated with this large e-commerce company. They have started using our platform. The ramp-up started already, and we do see the huge potential coming from this customer. In terms of large RFP, if you see this large RFP is a customer base globally. They're looking out for transmission globally. And probably Asia, Africa and Middle East is where Route Mobile will provide the data connectivity to this large being part of this large RFP. So I think whether it's TeleSign or Route Mobile, we believe that our connectivity in the emerging countries will pan out as a clear advantage to Route Mobile, and that is exactly where we are very excited about this RFP.
Understand. And Rajdip, related question about all this put together is about gross margin. Because of related party transaction, gross margin, I think even in this quarter, it, it has implication on gross margin. Considering some of these large partnership deals, do you think our gross margin likely to remain under pressure in medium term?
No, no, no, not at all. Not at all, because these are direct deals, and I don't see there's any impact, because of that. So that I can assure you.
Broadly, where we are currently operating, somewhere around low twenties is sustainable kind of gross margin?
Yes, indeed.
Okay. Thank you.
Thank you. The next question is from the line of Saumil Shah from Paras Investments. Please go ahead.
Hi, sir. What is our EBITDA guidance for this financial year? Sorry, I missed the opening remarks.
So around 13%.
Around 13%. And for the first half, I think we are less than 12%. So for the remaining half-
We are around 12.2%, so we've kind of guided at 13%.
...For the first half, we are at 12.2%?
Yeah, 12.2% on a reported basis, adjusted basis is at 11.9%.
Okay, okay. So for the remaining half, we need to go about 13% EBITDA margin. Is this doable?
Yeah. So the fact is, I mean, it's because of, I mean, H2 happens to be very strong, so the incremental throughput that we get, I mean, in terms of revenue and gross profit, directly flows to EBITDA, because, I mean, the ongoing overhead costs are largely fixed in nature. So there is a high operating leverage in the business.
Okay, okay. And, so when we grow our revenues by 18%-20% this year, in terms of bottom line, can we grow at a similar rate to 18%-20%?
It should, it should be. I mean, the only caveat is, I think tax rates have increased. So that's the only caveat. I mean, to that extent, I mean, maybe it may be a little muted.
Okay, okay. Because the current tax rate would be what? In the range of 20%?
Yeah. So it's around 20%-23%.
Okay, okay. And so last question: What is the other income of INR 32 crore for this quarter?
Sorry, come again?
There is other income of INR 32 crore for this quarter.
A large part of that is, I mean, so that's interest income and, also, I mean, there is foreign gain. So these are largely, I mean, emanating from translation, so there is... I mean, these are the two large components there.
Okay, okay. So this is not a recurring income for the remaining quarters?
No, no, no, no.
Okay, okay. Yeah, that's it from my side. Thank you.
Thank you. The next question is from the line of Yash Dedhia from Maximal Capital. Please go ahead.
Hello. Thanks for the opportunity, sir. Sir, firstly, on the effective tax rate, like you alluded earlier as well. So, tax rate now, since the mix will shift towards you and Middle East also will be levying tax. So for full year basis and going ahead, we foresee tax rate to settle between which, what rate around?
Yeah, it should be between 20%-22%.
So, current tax rate is something that will stay?
Around 22%. That's right.
Okay. And sir, one more question. The large RFP, which we were depending on, so this, our whole guidance of 18%-22% growth this year, and the future projection of, say, by 2028, $1 billion revenue. Our guidance depends on this particular RFP, or it will still stay even if we somehow not able to?
Yeah. So this RFP has not, I think, for next H2, we should not consider this RFP because it will take some time to integrate. But for sure, for three to four years down the line, they said many kind of values that will definitely going to be part of the value.
Okay. Okay. And sir, one broad question on the growth which we are projecting. Say, CPaaS industry is actually not growing, the industry per se. So in this, the growth, the higher growth which we are guiding on, part of which will be coming from synergy benefit, and part of it should be coming from the organic business which we have. So, what is the organic growth, which apart from synergy benefits, we are projecting on or you have built it in your internal estimates?
No, so we are not trying to kind of, kind of break that into two buckets. Essentially, I mean, the thought process of this deal, I mean, this partnership was to kind of a truly global company, access to all the enterprises globally. So, I mean, so from that standpoint, we are looking at this whole bucket. I mean, TeleSign continues to be an existing client, so, I mean, all the revenues that we are able to garner from them, I mean, happens to be organic revenue. So from an organic growth standpoint, I think we, kind of, reassure, I mean, the guidance that we have given for this. And I think over the next three years, we can...
We are working along with the group on a lot of these synergies, where we also have a lot of inherent strength in emerging markets, so a lot of that will also play out in terms of the organic growth strategy that we have planned.
Okay. And we are confident on achieving this target because of better H2 and stronger H2 than H1?
Yeah, H2 happens to be strong and historically, but for last year, where because there were a few headwinds. I mean, historically, it has always been like 45%-55% or 47%-53% in terms of the.
More or less.
Between H1 and H2.
More or less, to achieve lower band of guidance, we will have to grow by 22%-24%, at least.
That's correct.
Okay. Great. Great. Thank you so much, sir.
Thank you. The next question is from the line of Jyoti Singh from Arihant Capital Markets Limited. Please go ahead.
Yeah, thank you for the opportunity, so my question is basically on the GenAI side. Do we expect GenAI-based services to start contributing meaningful to the revenue? As earlier, I saw a few of the posts that we are, you know, talking big move in AI, so if you can guide us.
... So Jyoti, yes, indeed, there are multiple use cases, especially on customer support. Our team, especially our bot, which is called Roubot , and, like, our entire Omnichannel Stack has GenAI capability, and we are solving some of the problems of the customer through our GenAI. So we are very much aligned with the progress in this space, and we are using the technology to help our customer to have a better outcome.
Sir, any meaningful revenue that we are expecting?
Jyoti, it will be add-on services to the customer right now, and we are just testing multiple things on GenAI with our customer right now. We cannot quantify at this point of time. Probably in the next few quarters, we will, we may give some kind of, you know, like, numbers to that.
Okay. Thank you so much.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of Arvind Arora from Enam Capital. Please go ahead.
Hello, am I audible?
Yes, sir.
Thank you for the opportunity. So my question is with regards to the synergy benefit that we are drawing, drawing due to the arrangement with Proximus Group. So is there any change in the first part due to this arrangement?
Sorry, can you repeat your query? Is there any...
Is there any saving in the cost, like, as we are talking synergy in the benefit? So we are talking on the problem, but is there any cost saving part also where we will get a reduction in per transaction cost due to the arrangement with Proximus Group?
Not yet, some of those things I think are being assessed, but nothing of that sort is kind of laid out right now.
Okay, that's all from my side.
Thank you. The next question is from the line of Ashok Shah from Investec. Please go ahead.
Thank you for taking my questions. So regarding this, dividend distribution and further CapEx or the money to be deployed in the business, can you throw some light?
Yeah, so I think from a guidance standpoint, we have kind of given a guidance of distributing up to 20% of the PAT as dividend. I mean, so the dividend distribution is in line with the guidance that we have given, and from a CapEx standpoint, I mean, but for the research and the product development, I mean, we don't have any significant CapEx. I mean, we are largely, I mean, more an asset-light kind of a business model. So per se, there isn't any significant CapEx required for the business.
So, how this cash should be, would be deployed or it will be invested in this New Products or something which you have on your hands?
Sorry, sir, I didn't get your query.
Sir, you told that there is no CapEx to be involved, so how the cash generated will be invested in future?
Yeah, yeah. So I think we have a dividend distribution policy, and on top of that, I mean, we keep looking at kind of opportunities where we can augment the capabilities of the platform. I mean, so we keep looking for some of those opportunities. And when we find an I mean appropriate kind of fit from our product and our vision standpoint, I mean, we would like to kind of do maybe a few tuck-in acquisitions.
Just to add out here, we already have a decent-sized R&D team and, like, new product team. We already been working on new products and the new technologies. So I think we already invested, and I think we'll continue to invest in those areas as well.
Okay. Okay. Thank you, sir. Thank you. That's all from my side.
Thank you. The next question is from the line of Dipesh from Emkay Global. Please go ahead.
Yeah, just so I think in your prepared remarks, you said, weakness in MRM and ILD revenue, I think seven workdays because of certain reasons, revenue growth was impacted. Can you provide more detail around it? And what was the total quantum because of these factors?
Yeah. So, I think on the ILD side, I think the impact was about close to $3 million for about seven days of revenue impact, and on the MR Messaging side, I think we had seen, I mean, weakness on a QoQ basis to the tune of about INR 99 crore.
Okay. Thank you.
Thank you. The next question is from the line of Devraj, who is an individual investor. Please go ahead.
Yeah, hi.
Mr. Devraj, I would request you to unmute your line and speak, please.
Yeah, hi. Am I audible now?
Yes, sir. Please go ahead.
Okay, hi. So, I had a question or two, but I think the question on the allocation of capital has already been answered. But I just... I just want to understand the future trajectory of the debt that the company is taking on, because we've really ramped up on the debt, right? And I understand some of the compulsions. I've been following this company for a while. So what's going to be the future trajectory on the debt that the company plans to take on?
... Yeah, so I think what we are embarking on is leveraging the strengths of the group. So, I mean, just to kind of give you a color, I mean, so BICS has one of the largest infrastructure, I mean, in terms of the telecom infrastructure, I mean, so they enable a lot of the voice calls. I mean, over 50% of voice traffic, I mean, terminates on BICS platform. So we're going to use the strength of BICS globally. Then we are going to use the digital identity strength of TeleSign. I mean, so they have kind of really evolved in terms of rendering more security to every digital transaction.
And then, at this point in time, as we speak, we are doing a few sandbox testing, I mean, even in India, with the regulators and a few large banks. That would be the wrapper on every digital transaction. And on top of that, we would kind of power our RCS platform with all the digital transactions for an enterprise. We would be a one-stop solution provider for the entire digital journey of any enterprise to their consumer, in any form and shape. I mean, they will be, we'll be able to kind of power a very secure digital transaction seamlessly over the infrastructure layer of the group. That's the thought process I think that we are embarking on.
I think just to add to this, I think our entire platform, you know, like, now has the TeleSign and BICS as a company, I mean, TeleSign as a company, have access of entire platform of ours, and we can take this entire platform to European countries and the US-based customer. That is another big strength we believe in coming quarters down the line, where we can see lots of sales coming from this part of the world to recover portfolio.
Right. Right. Okay.
Thank you. Ladies and gentlemen, we will take that as the last question. I would now like to hand the conference over to Mr. Gautam Badalia for closing comments.
Yeah, we thank you all for your participation. In case you may have any additional queries, clarifications, please reach out to us, and we'll be more than happy to answer any. Thank you.
On behalf of Route Mobile Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.