Newgen Software Technologies (NEWGEN) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 revenue reached INR 315 crores (₹3,147 million), up 25% year-over-year, with strong growth across all regions and notable traction in trade, lending, and supply chain finance solutions.

• Profit after tax rose 58% YoY to INR 48 crore (₹476 million), reflecting robust operational performance and improved margins.

• 13 new client logos were added, with significant deals in Indonesia, Malaysia, Qatar, US, and India; up-selling and cross-selling to existing customers contributed significantly to revenue growth.

• Launched LumYn, a GenAI-powered hyper-personalization platform for banking, and expanded insurance vertical initiatives.

• Recognized in Gartner's Market Guide and reaffirmed CRISIL A1+ short-term rating.

Financial highlights

• Consolidated revenue from operations was ₹31,471.93 lakhs (INR 315 crores), up from ₹25,167.09 lakhs year-over-year, with annuity revenues at INR 201 crores.

• Profit after tax for the quarter was INR 48 crore (₹4,756.98 lakhs), up 58% year-over-year.

• PAT margin for the quarter was approximately 15.1%.

• Net trade receivables stood at INR 402 crore as of June 30, 2024, with net DSO of 112 days.

• Cash, bank, and investments totaled INR 850 crore at quarter-end.

Outlook and guidance

• Focus areas for upcoming quarters include product innovation, scaling operations, global expansion, and enhancing banking and insurance solutions.

• Targeting 20-25% top-line growth, with margin expansion expected as scale increases.

• PAT margin guidance raised to around 20% as growth and productivity improve.

• Management highlighted continued strong demand for digital transformation solutions, especially in banking and financial services.

• A dividend of ₹4.00 per equity share for FY24 was recommended, subject to shareholder approval.