InfoBeans Technologies (NSE:INFOBEAN) Q2 2027 Earnings Call

0:00 Welcome everyone and thanks for joining this Q2 FY27 earnings call for InfoBeans Technologies Limited. The results are available on the stock exchange. In case anyone does not have a copy of the same, please do write to us. We will be happy to send it over to you. To take us through the results of this quarter, we have with us three co founders, Mr. Vinas Sethi, Mr. Siddharth Sethi, and Mr. Mitesh Bora. We will be starting the call with a brief overview of the company's performance, and then we will allow the Q and A session. Kindly ask your questions by raising your hand and the brief overview where Avinash is over. And then we will address all the questions one by one. I would like to remind you all that everything said on this call that reflects any outlook for the future can be considered as a forward looking statement and must be used in conjunction with the uncertainty and the risk that we face.

0:54 These uncertainties and risks are included but not limited to what we have mentioned in the prospectus filed with SEBI and subsequent annual reports. With the said note, I turn over the call to Avinash. Over to Avinash. Thank you, Surbhi. Thank you everybody for joining this call. I know it is market hours, but you know results were out yesterday and we wanted to you know cover the report today itself. So, please go to the slide deck. So, INFOBEAN is a company always believe in investing in the latest and greatest of the technologies available at that time and we have been investing heavily in the AI capabilities and the biggest news of this quarter in my mind is that we have got Claude select services partner status from Anthropic and we have more than a dozen certified cloud developers and a couple of forward deployed engineers who are certified with us.

2:07 So, that gives us enormous power and strength to go to our customers and deploy anthropic solutions or AI solutions at their business to improve their capabilities and efficiencies of the business. So, if you look at the slide I am assuming it is visible to all of you. We are present across the four geographies three are the major markets US, Middle East and Europe and we have development centers in in Indore, Pune, Chennai and Bengaluru. This is a quick road map of the transformation journey over the years. We have been in business for twenty six years now incorporated in 2000.

2:59 You know we achieved our first milestone of 4 crores in 2007 and within eight years in we in 2015 we kind of reached 10x and then from '15 to '23 we kind of reached again you know little less than 10x at $3.99 crores. We acquired couple of companies between 2019 and 2021 and before that we went public in 2017 on the SME platform and then moved to the main platform on the main on 2019. We onboarded Fanish Moorthy as our advisor to the board in 2024. It's more than two years now. Opel Perry joined us as independent director in 2025 and we had our second buyback and a bonus in 2026.

3:57 This is a quick numbers at a glance. One of the biggest strength of InfoBeans is that we have 50 large enterprise clients even at this size. We are a very small company in the entire IT landscape in India, but despite that we have Fortune 500 customers and Fortune 100 customers which is part of our direct relationships. More than 94% of these clients come back for more work every year and that is again very important strength and a moat if you want to call that. We have been investing heavily on the AI and our software development exercise is very very AI enabled for the most part. We have done two successful acquisitions as I mentioned 2019 and 2021.

4:47 One was a cross border acquisition of Philosophy Group INC and second was a Salesforce platinum partner from Pune called as Internet Solutions. We did two buybacks in 2021 and 2025. 2021 was at four times of the IPO price and 2025 was eight times of the IPO price. Last year financials, had a good run, good revenue growth versus good improvement in the margins both on the PAT and EBITDA side. Significant amount of cash and cash equivalents as a reserves in the company And we have been growing at 23% CAGR since 2081. As I said, all of these partnerships and certifications, think the most important one is cloud partner network as of now.

5:40 This is where our global service offerings are, AI led engineering across the organization and Salesforce and ServiceNow are the two technology platforms that we focus on because both of these are being used by large enterprise customers and it is kind of a segue into those clients for us once we get an entry inside these organizations using Salesforce and ServiceNow. Practices. We aim to focus on BFSI as a strong vertical for us because we have a dozen clients in the BFSI space and same with storage and virtualization as another vertical space that we have. A quick snapshot on the team, the three founders here Vinash Mitesh and Siddharth and we have our independent directors Opel, Mayuri and Summerser.

6:31 Summerser has retired by tenure in the month of very strong engineering team and you know long timers at INFOBEAN. Amit Makija is almost two decades with INFOBEAN. So, Dennis is almost five years now. Kanal again more than two decades, Kanupriya and Aprith. Very key people in terms of sales and client success, these are the people who hold the fort for us in front of the client, Ram, Gitaanjali, Manish and Tarunatha in different geographies.

7:21 Quick snapshot of our clients, most of the clients prefer not to name them and therefore, we have to put it under NDA. If you look at the NDA lot here, a Fortune 200 company, a Fortune 500 company, another Fortune 500, another Fortune 500 German company. So multiple such clients that we've been working with. And most important factor here is their average age average age of the relationship with these clients for InfoBeans is more than nine years now. You know, ILM is a client which is with us for more than twenty two, twenty three years now. IQVIA is for more than eighteen years now. So very, very long relationships is is another moat for InfoBeans as a company.

8:07 Quick financial snapshot here, we have grown 28% Y o Y on the total revenue from 129 to 165. On EBITDA side we have grown 14% and on the PAD side we have grown 16%. On the USD terms we have grown 22 Y o Y, remaining was INR appreciation, dollar appreciation against INR. On a quarterly basis also I am happy to announce that we have grown at 6% Q on Q which is quite a good growth in the current market situation and EBITDA also has grown 14 and PAT has 21% Q on Q as well. Since we are closing our half yearly results here, there is a good comparison, quick comparison on H1 to H1 of last year.

9:00 Note that the last year H1 had about 6.3 crores of ERC, employee retention credit from the US government which is an extraordinary income which we have for the comparison here we have removed from the numbers. And if you look at it H1 to H1 we have grown 30% and EBITDA 18% and PAD 22%. In USD terms the growth was 22 similar to the quarter length number. Similar numbers in different presentation, PAT margins at 16%, we are happy with it and 1% drop was probably because of the I mean as I said we typically I keep telling every quarter that we typically aim for 24% EBITDA margin and 15% PAT margins 14 to 15% PAT margins.

9:53 So, we are very very happy at these numbers. Reduction does not tell us anything here because that is where the targets are. And one important factor is seven quarters of sequential operating revenue growth of 6% over 6% quarter on quarter for the last seven quarters. So that tells us that we are in a momentum which is sustained and we are growing constantly quarter on quarter for last seven quarters in a row. Little bit more detail here, revenue from operations, other income, if you look at it the other income dropped by 2 crores, but the revenue from operations have grown by 8 crores sorry.

10:44 10. June should be on this side okay. So, it is by 10 crores and other income dropped by 1 crore quarter on quarter by 2 crores on a year on year basis and the other income component was mostly because of the RBI increasing the rates. Our treasury is mostly held in corporate bonds and government securities. So, the yield disturbs the IRR, but since we will hold it till maturity, it is just a notional loss for us. Total revenue grew from 130 to 166 on a Y o Y basis and EBITDA grew from 36 to 41 crores. EBITDA margin comes back to the steady state number. Last quarter it was 23, this quarter it is 24%.

11:36 So, we have good growth here. PAT margins have improved from 14% to 16% Q on Q from 22 to 26 crores. We continue to investment AI capabilities and we continue to build our sales capabilities across all the three geographies. So, there is going to be investment which might put a pressure on the margins in future as well, but that's totally okay because we are investing and building the business. A quick balance sheet snapshot here. Most of the money and the profits got added up into the reserves. So some movements because of dividend, because of amortization and so on typical business scenario.

12:22 Revenue breakup of USA, we are kind of balancing it fairly well. USA is now at 49%, Europe is at 40% which is a good counter balance to the challenging macro environment posed by the Trump government. UAE at 8% which is kind of a steady state, rest of the world including India is about 3%. So, good momentum in the European market for us. AI update, I mentioned earlier, we got this cloud select services partner just last, two weeks ago. And we are also ISO 42,001 certified for AI practices. Lot of these engineering products are used as a accelerator for our clients as a showcase and door opening strategy for us. We use these tools to showcase our capabilities to the client.

13:22 Awards for the tenth time we have nominated as a best employer brand by Asia in Asia and EcoVadis has a very rapid sustainability rating which is important for us in today's context because every new RFP is asking for our ESG ratings and EcoVadis is very reputed rating institution and we have got a bronze medal which means that we are ranked in top 35 globally, 35% globally across our ESG practices. We also take our CSR activity very seriously and that is where we have instituted this InfoBeans Foundation under which we run an ITEP, Information Technology Excellence Programme where we train underprivileged youth to become software engineer within a period of one year and after that they are successfully placed in IT companies across Hindalco and Pune.

14:36 So we have two objectives, education for employment and sustaining the green cover of the mother earth. So, we do plant trees every year in the monsoon season. At the same time we have trees planted for birthdays of our team So, that is a scheme that we have and therefore, we have every quarter we would have significant number of trees planted across the country mostly around Indore and Pune region. Quick market data as of September 30, the market price was 143 and the market came out at $13.91. I will open it to Survi for question and answer. Survi and Kunal, continue and let's open the forum for question and answers.

15:33 So, thank you everyone. We will now begin the QA session. Participants are requested to use the raise hand feature. We will allow you to talk. You can unmute yourself and ask your question. We further request you to limit yourself to one question at a time. You may rejoin the queue for the follow-up questions. We would be happy to take them if the time permits. Thank you. So first question is coming from the line of So, the first question is coming from the line of Keshav Karwa. Can we ask them to type it, if

17:11 you are not able to hear them? Type it in the chat box please. I would request the participant to please type their question. Will take it. So first question is from mister Mihir Dami. Mihir, please unmute yourself and ask your question. Mihir, please unmute yourself and ask your question. Yeah. Thanks for the opportunity.

17:56 I'm back from a great event. I wanted to ask where are you in traction currently? How are you able to support such great growth? Which industries are doing well for you currently? So we work across multiple industries. As I mentioned, BFSI, manufacturing, logistics, HR. We have seen growth across all the segments. It's hard to find typically it's hard to put a finger to a particular industry. We're growing well across all our clients, not a much challenge. I think except for healthcare compliance, we are not seeing any worry sign.

18:51 Okay. Also, how much was the net hiring for the quarter and what are your plans for hiring for the year? So we continue to add skills across the board since we are seeing good demand at 30% growth rate. Our hiring net addition would be in the range of around I would say 10% to 15%. So, the revenue growth is not really mapping up exactly to the headcount that it used to be. So definitely it is kind of an indicator that we are using AI to improve our efficiency and optimize our delivery efforts. Net number if I were to tell you is about 43 net addition that we added in this quarter. On a base of 1,800 plus which is like about what is it 10 much like two, three how much it is? Four, two, three. 5%.

19:46 5%. Less than. Less actually three, 4%. Okay. Also can you give us an idea of that deal wins you all have had recently for the quarter or last one year? There is I mean we do not disclose these individual client deals or the size of the deals. That is not a practice that we have been following. And as I said, typically I think there is a press release also where we mentioned that there are three clients that we have won, two from The US market, one from the Indian market. And typically for a services company like ours, the deal size at the start is very small.

20:32 It is a first step towards building the trust relationship between the two parties. And it is eventually and gradually that we generate significant business as a repeat business from these customers. So deal wins is irrelevant in our context. And one thing you mentioned about the clock. Meher, I will request you to come back in the line please. Yes. Thank you, Mihir. Next question is coming from the line of Mr. Hitesh. Hitesh, please unmute yourself and ask your question. Hi. Am I audible? Yeah,.

21:22 So I have couple of questions. Actually, I wanted to understand what changes this AI is bringing. We know there are a lot of changes, and it's happening on a daily basis. How you are changing yourself? What capabilities are you building around AI and to grow with the AI and how industry landscape is changing with this? Mitesh, would you like to take this? Hitesh, are you able to hear me okay? Yes, I can hear you. Okay. Thank you so much for your question, Hitesh. AI landscape continues to change and almost feels unrecognizable from 2025 if you look at 2026.

22:11 For us, our goal has always been to look at where our clients need the real help. Now, the usuals, which is utilization of the frontier models to do bulk of the actual engineering work, keeping design, keeping architecture intact, keeping quality assurance and the process intact, but large part of the software development we can continue to build using such models. So that is one factor that doesn't change much. So we continue to develop capabilities in and around how to best utilize that. So that is one. The second big evolution that we have seen this year is utilization of agents in actual enterprise environments or what you call the agentic enterprise going forward.

23:08 And deployment of agents in scenarios where simple support such as for example an L0 or an L1 could be removed. Again, this is just an example or a contact center situation or software that is scheduled, there is automation that can be used. So enterprises have been now increasingly starting to see the value that comes from agents that get deployed in their environment. Of course, there are a lot of issues and challenges that have emerged also. The likes of governments, their concerns around data privacy, their obvious concerns around cost, you might be hearing a lot of that. We are constantly building capabilities and expertise in and around all of that.

23:57 Today, I was talking to somebody in San Francisco. There is so much conversation that is happening around multi agent systems, which is a very natural progression in a lot of organizations. And there is a lot of talk about how context, how coordination can be utilized as efficiency levers going forward to ensure both accuracy and cost are maintained because these are very important considerations for enterprises. So this is something that we keep focusing very heavily on. At the end of the day, it is about solving problems for our customers and utilizing technology in the best possible manner. That's how we go about it. I hope that answers your question.

24:44 Yeah, that's pretty much what I was looking for. One more question I have like, how we see going forward changes in pricing? Are we feeding any pricing pressure from the customer end or industry wise? I mean, we are moving to outcome based pricing to and it does it impact the I... I'm sure it it does not impact the amount of work, but does it impact our top line in some way? It... Does it hamper? So, no, it does not hamper our top line in any way because we keep on getting more work.

25:29 As Avinash pointed out earlier, our net addition is much lower than the growth in revenue. That is some kind of an indication of the the the lack of pricing pressure so to speak and even then our profit increases. So there is no such pricing pressure that we see right now. I think what is more important to the customer is how much value are we adding using AI without AI, whichever way we go, the customer is trusting us banking on us to provide solutions to solve their business problems. We are also using AI internally to increase our efficiencies. So for example, our internal evaluation process which used to take a few weeks two or three weeks is now completed in a matter of days because we have built internal systems that help us do our performance appraisals you know very quickly very fast it was a very tedious and cumbersome process.

26:24 Similarly, on our sales side and marketing side we are able to use AI very effectively without rapidly increasing the sales or marketing team for for our outreach, for our email campaigns, marketing campaigns, our social media campaigns. So all of those things help us in increasing efficiency, reducing overall cost, and even then keeping our margins intact and increasing revenue. So I think the numbers speak for themselves in terms of lack of pricing pressure. So thank you, Mr. Hitesh. You can rejoin the queue if you have follow-up questions. Yeah. Just all the best to the management. Thank you, Hitesh. Good. Yeah. Yeah. Thanks. Thank you. So next question is coming from the line of Mr. VP Rajesh.

27:11 Rajesh, unmute yourself and proceed with your question. Mister Rajesh, you need to unmute yourself and proceed with your question. Hey, VP. How are you? He's unable to unmute. Is unmuted. Rajesh, you are already unmuted. You can proceed. We can hear you.

28:07 So let's take the next question. Next question is from Sumuk. Sumuk, please unmute yourself and ask your question. Hi team, am I audible? Yes, Sumuk. Congratulations on a very good quarter. Thank you. So I have two questions, one is on the 99 crores which which has been capitalized in H1, which was intangible, it was at work. So regarding that and also the 8 crores loan that was given to the director, can you please give us more understanding on both of these line items. So what was the first question, if you can repeat. So one is the capitalization of intangible of 9 crores. Yeah, yeah. So, okay.

28:57 Yeah. So, we have been developing certain accelerators in the system and there is always this lag in revenue generated by those actually it is no sooner these are products. So, there is a product called a stanza, there is a product called a bean trail and we have been investing in these products. So, the capitalization is towards the effort that is going to go and the revenue is going to come later. So, we capitalized it and revenue started coming in. So, we have started to start amortizing it, that is one. The second part is the directed loan. So, we have a policy in The US where the employees can get a loan of up to $1,000,000 and since Mitesh is also a director and an employee of InfoBeans's INC.

29:52 So, he availed that facility and it was a I would say three four month period between which it was repaid as well. So, there was an interest bearing loan it was given to him and under all the norms that we have followed that is a practice. Thank you and one more question is this 22% constant currency growth. So how much of it could be attributable to growth from existing clients and how much from new clients that has happened over the last two quarters? So you are talking about a quarter on quarter growth, right? 6%. 22% YMY. Yes, yes. Okay. So the Y o Y growth I would say typically every year we have more than 90% business coming from the existing clients. Clients.

30:49 The remaining business comes from the new clients. Now in a services environment what we sell is trust and trust takes its own time to get built over the years. So typically the first quarter would have a lesser share of revenue from a new client versus the let us say sixth or seventh or eighth quarter. So that client journey grows eventually from you know first quarter to you know fourth, fifth quarter to eighth quarter to ninth quarter and we have a history of clients that you know stay with us for multiple decades. And that is where the value comes for us where we continue to keep generating margins and better business from each of these clients over year over year. So it a nature of the services business that takes its own ramp up time for a new client.

31:50 Having said that, we continue to make our sales efforts in a way that we strike multi million dollar deals on day one. And it takes its own time anywhere between six to twelve months to get to a closure for such clients and such deals. Let me also tell you that we focus on large enterprises which has its own nuances to navigate to reach to a level where we can get to the dotted line. So it takes its own time and process to get there, but despite that, not everybody is willing to sign a multi million dollar deal on day one. So they take their, they start with small work and then build successively from there.

32:41 Thank you, Sumuk. May rejoin the queue for the follow-up question. Mr. Rajesh, please try and unmute yourself and ask your question. So Rajesh, if you are facing any difficulty with your mic, you can put your question in the q and a box. By the time, we will take the next question. Next question is from mister., please unmute yourself and ask your question. Hello, sir. Am I audible? Yes, Mohit.

33:32 Yes. I I think so. I've already put it in the chat bot... Chat also. I had a question with regards to our revenue and EBITDA kind of growth we are targeting for the... Or for revenue and EBITDA targeting for the full year. And what kind of growth can we see going forward? I understand that you talked a lot about relationship, but it is more in the back right now going ahead with the changing times. Does still it affects how much growth we are going to get in this changing time? See we do not give the forecasting and the you know I would say forward looking numbers.

34:17 But what we are seeing in the market today is there is a sustained growth momentum for us. We continue to have a good healthy order pipeline and healthy demand. So hiring continues, our AI training continues, our relationship, our projects continues. So, we we are finding good as I said sustained momentum at this point. Okay. And I had a h next question in regards to the situation in The US. It is becoming a little bit challenging for companies to do business over there due to certain visa norms and all. So what kind of a different spread are we looking at?

35:05 Are we trying to expand into other geographies? And going forward the 49% which we have currently can that be further reduced through diversification? See as a company our focus will be to increase our US revenue share. US is a very big market and we have been in business with The US for twenty six years now. So, we would certainly want to expand more in The US because we have a very large reprincipal client list also, that is point number one. The other point is we are still a micro company and the macro environment that we hear in newspapers and media do not really affect us on either side, on the bad side or the good side.

35:55 What works for us is the relationship that we carry with our clients and the kind of demand that they see in their own businesses. So I do not think these macro factors are negatively affecting us. The third point that we talked about was the visa. So we are not I mean from day one we have not been dependent on H1B visas, we have always been offshore heavy and bulk of our revenue is through our delivery centers delivered through our delivery centers across India. So, even if you look at today out of this almost 1,900 people team, you would have less than 50 people across all the three geographies which is very insignificant in the entire equation and therefore, you know there was this H1B restriction four, five years ago and here you know it is made extremely tough by the Trump government, but it does not really affect us because we are not a visa dependent business.

36:57 Okay, thank you sir. I will get back in the queue. Okay. Thank you. Thank you, Danwit, thank you. So, Rajesh unfortunately your mic is not working, but I will convey your message to founders and I will ask your question. So, Avinash Rajesh is saying congratulations to us for the numbers for this Thank you. And he has a question that cash has gone up significantly. And second question is any update on the aminephrine? Yes, we are cognizant of the fact it is a good and a bad news that cash is getting accumulated in the business that is a good news. Yes, we are in the process of constantly scouting for the right target and thankfully I think last quarter there were good number of I would say leads for the targets which are suitable to our you know. So, let me also tell the audience here that we have a very strict acquisition criteria and you know it was only in I would say in last few months that I was seeing some good fitments as a part of the lead generation effort on the M and A side.

38:06 So, I yeah I think we continue to make that effort, it is a it is a sales kind of a situation in hit or miss you do not know, you cannot even predict until that is signed. So, yes the efforts are on I will for the benefit of the audience I will quickly narrate what we are looking at. We are actively looking at ServiceNow companies or AI and data companies in a 5 to $15,000,000 revenue range with overseas customers and delivery in India. So, this is the kind of filter that we have applied and any deal that comes to us through any banker has to meet this filter before you know it even gets there. So, so it takes it is you know the filters are high and but as I said there are leads coming in.

38:58 Now, are we in a serious discussion or you know at a closure stage difficult to say unless it is done. Once it is done, we will announce it to the board on the NSE and BSE both. So, yeah, I think once the term sheet is signed or there is a progress which is a tangible progress, we will announce it, but until then it is very difficult to predict anything. But yes, we are aware of the cash position and certainly want to make good use of the cash towards building the business. Let me also add here for the benefit of the investors here that as a company we are firm believer of using the capital to reinvest and grow the business. We have been doing it every year for last twenty six years.

39:44 We are not a company that you should look at for dividend yields. We pay dividends, we do buybacks as when needed but it is not an active strategy for us to give the cash back to the investors. We would rather use it to build the business and navigate the challenging times that is posed ahead of us by investing in AI and being more aggressive on the sales side. So we want to generate better value out of the business rather than return the cash. Yes, thank you. So we have some question in chat box. So most of them are asking that why the trade receivables has increased.

40:33 Some pressure of the you know client ends where and then some of the clients actually change their terms also. So from sixty days to ninety days and some of the clients have been delaying their payments. But these are long standing clients so we know that it is not a risk. Despite that we make provisions in our books. So, we are well covered in that sense. But yes, are confident that all of these delayed receivables will be received fairly quickly. We are at it, we are chasing it constantly. Also I believe some of the increase in receivable would also be a function of growth.

41:21 That's correct. That's also contributing to it. Danwit, do you have a follow-up question? If you have, you can unmute yourself and ask your follow-up question. Mister, you can unmute yourself if you have a follow-up question. I do not have any follow-up question. It was an older question which I had posted in the chat box. That was the same question. Alright. Thank you. Thank you, Dwight. Yes. Thank you everybody for your time and interest in InfoBeans. We appreciate your support and we look forward to more such good quarters. Thank you so much. Thank you. Thank you everyone and now you may disconnect your lines.

42:19 Thank you.