6th March 2023 –Cigniti Technologies –CNBC interview with CFO K Venkatachary :
–Q4 as of now cautiously optimistic & Biz is looking good, going by the run-rate we are confidant of repeating the performance for the Qtr ahead and FY24 also looks very good with order book situation & kind of renewals that have taken place.
–9M revenue is 154 Mn$ and FY22 is at 164Mn$ which going by Qtrly run rate their is 25% growth. Out of 32 clients out of top 60 clients have given price increase & the range of price increase is 7 to 10%.
–This increase is affected from Jan23 and rest of the client are getting affected from 1st Apr’23 based on the renewal timings.
–Going further for the existing clients the scope for revision on price increase is very limited but its more to do with selling. In digital engineering as a segment was 6 to 7Mn in the FY22 yr but this year it will be 9% which is roughly 18Mn$ on the estimated no. of 200Mn$+
–We are giving big push to digital engineering and we are confidant that we will be 24% of contribution from this segment in FY24 which will also be high teen growth.
–Margins –Margins will be in our favour as it has increased from 9.5% in Q1 to 15% in Q3FY23. We are tgting north of 16%+ next year based on the current estimates and FY23 will end up on avg.14.3% but we will move up to 16%+ with digital engineering push and price increase coming for the full year & few composition mix wherein more offshore which will yield higher margins for us. Stability of labour will also contribute to this.
–2 yr back there was an ambitious tgt of 500Mn$ & current run rate is 200Mn$ , last yr we did a rejig of our strategy wherein organically we had kept a tgt that by 2028 we should be getting to about 650Mn$ but putting both inorganic + organic together we will look at 1Bn$ size , organically we are ambitious to reach 650Mn$ by 2028
–Retail segment contributes around 16% to the topline, we have estimated 16/17% but from the retail enhancement have not happened but we have not seen any pushback in terms of budget from the retail as a segment where we are operating with the cust. but we are cautious for the next 2 Qtrs for this segment. The further spends are not happening and ramp-ups in deals is not happening & deferred by a couple of Qtrs
–InOrganic plans ? –There is a separate team which reviews it and we are serious to acquire capabilities on the digital engineering side & we are evaluating and there is a fair amout of pipeline & as the board decides we will come back to the media on it.
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