C.E. Info Systems LtdQ2 FY23IT - Software

C.E. Info Systems Ltd

Q2 FY23 Earnings Call Analysis

Management growth scorecard

Revenue

Category 1

Margin

Category 3

Fundraise

N/A

Order

Yes

Capex

Yes

3 of 4 growth signals are positive.

Revenue guidance

Category 1

→The company is targeting a 40%+ year-on-year growth in revenue for FY '24 and beyond, as stated by management.
→Growth is broad-based across segments including automotive OEMs, mobility fleets, consumer tech companies, and government.
→Increasing customer base (from 600 to over 850 customers) is driving revenue expansion.
→The connected vehicle journey, especially with EVs and ADAS, is a medium- to long-term growth engine in automotive.
→IoT business volumes, such as devices sold (~1.9 lakh devices in FY '23), are growing, with SaaS income and margins expected to improve steadily.
→Drone business positioned as a future growth pillar with opportunities in mapping, survey, and government projects like SVAMITVA.
→Real-time map updates and new product features like 3D airport maps and infrastructure developments support expanding use cases.
→The company expects to cross INR 1,000 crores in revenue within the next 4-5 years based on current growth trajectories.

Category 3

→The company aims for around 40%+ top-line growth for FY '24 and the next 3-4 years (Page 14, 15).
→Growth is broad-based across automotive, mobility fleets, consumer tech, government, and enterprise sectors (Page 5).
→The company anticipates crossing INR 1,000 crores revenue milestone in 4-5 years (Page 5).
→EBITDA margins are expected to improve gradually, with Map-led business at around 54% margin and IoT segment margins expanding over time (Page 3, 11).
→IoT EBITDA margin rose from 4% last year to 6.3% in Q1 FY'24, with a positive SaaS income impact expected going forward (Pages 3, 11).
→The business focuses on capital-efficient execution and sustainable margin protection amidst expected competitive challenges (Pages 6-7).
→Seasonality is viewed on a year-on-year basis; full-year growth and profitability are prioritized over quarterly fluctuations (Page 15).

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→The transcript on page 17 does not mention any current or planned fundraising through debt or equity.
→There is no discussion related to raising capital via equity issuance or debt borrowing in the Q&A or closing remarks.
→The focus is primarily on business updates, map updates, IoT revenue, and operational matters.
→The company emphasizes capital efficiency and executing its growth plans within its existing resources.
→No specific future plans for fundraising were indicated during this call.

Yes

→At the beginning of the year, MapmyIndia had an open order book of INR 918 crores.
→The company added around 250+ new customers in the last year, increasing the total to over 850 customers from 600.
→Growth is broad-based across market segments including automotive OEMs, mobility fleets, logistics, consumer tech, traditional corporates, and government.
→Revenue recognition happens as deliveries are made against this order book.
→The company is on track for a 40%+ growth for the fiscal year.
→The open order book and customer additions imply a strong pipeline supporting this growth trajectory.

Yes

→The company has made inorganic investments and partnerships specifically in drone solutions and IoT hardware to leverage capabilities from specialized companies rather than manufacturing drones themselves.
→These investments support providing full drone-based solutions including data capture, processing, and analysis, which enhances their mapping and geospatial platforms.
→Focus on building reliable hardware sources for IoT and drone segments through these strategic and inorganic investments.
→There is ongoing significant investment in advancing their map data products, notably developing a "4D high-definition digital map twin," which integrates drones and IoT data.
→The company positions drone, IoT, and mapping businesses as three strategic pillars supporting future growth and expansion.
→Although specific future capex figures are not disclosed, investments in technology platforms, hardware partnerships, and map advancement are key areas of focus.

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