Kore Digital Limited (KDL) Earnings Call Transcript
November 18, 2024
Earnings Call Speaker Segments
Ladies and gentlemen, good day, and welcome to the Kore Digital Limited H1 FY '25 Earnings Conference Call hosted by Kirin Advisors. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Ganesh from Kirin Advisors. Thank you, and over to you, sir.
Thank you, and good afternoon, everyone. On behalf of Kirin Advisors, I welcome you all to the conference call of Kore Digital Limited. From the management team, we have Mr. Ravindra Doshi, Managing Director. And now I hand over the call to Mr. Ravindra Doshi. Over to you, sir.
Good afternoon, all the participants. I extend a warm welcome to everyone for today's conference call. Most of the details we have already covered in earlier calls also, so I will not go into the market size and all those things. Today, I'm having very bad throat and a little cough, cold. So please excuse me if I don't go in detail. Yes. We move on to our financial performance for the first half of year '25. I'm pleased to report strong growth across all key metrics. Our total income surged to INR 91.82 crores, reflecting an impressive year-on-year growth of 511.35%. EBITDA stood to INR 10.88 crores, making a 145.78% increase with an EBITDA margin of 11.85%. Net profit for the period grew significantly to INR 7.58 crores, representing year-on-year growth of 142.44%. Meanwhile, net profit of 8.21% furthermore, our earnings per share reached INR 18.81 registering a growth of 89.05%. These strong results underscore the operational efficiency, strategic execution and unwavering focus on delivery of [indiscernible] Second quarter of '25, our financial performance was impacted by monsoon, as I told earlier also, the second quarter is always lean in our line. So this slight reduction is there in it. During quarter 2 financial '25, we reported a total income of INR 41.05 crores, EBITDA at INR 3.42 crores and EBITDA margin of INR 8.32 crores. Net profit stood at INR 2.24 crores, translating a net profit margin of 5.46%. The EPS came in at INR 5.59. While these figures reflect seasonal challenges to the quarter, we remain optimistic about a strong recovery in operation, which is normal for every year. These financial results highlight our performance amidst seasonal challenges. However, with operations normalizing post monsoon, we anticipate a recovery and multiplication in coming quarters operationally and financially. In rising demand for communication infrastructure and infrastructure [indiscernible] present significant growth opportunity, and we are confident that our strategic positioning, focused execution will enable us to deliver improved results in the near future. Before we transition to our question-and-answer session, I would like to express my heartfelt gratitude to all stakeholders for their continued trust and support. Our contributions remaining invaluable to our journey -- sorry, your contribution remain invaluable to our journey, and we look forward to your ongoing engagement as we work towards sustained growth. With this, I now open the floor for questions. Thank you. Please, Mr. Ganesh.
[Operator Instructions] The first question is from the line of Aditya Dave from CAO Capital.
Sir, since the time we last spoke, there have been a couple of developments in the telecom industry. And I wanted to understand how they would impact our business. One is the Vodafone issue, which has again deteriorated substantially. Would that have any kind of direct or indirect impact on our future projections? And second was the large tender, which was awarded by BSNL for BharatNet Phase-3. And then subsequently, the entire thing has gone for litigation. So again, what kind of impact do you see of these two events on our business? If you can elaborate on that, sir?
First, let me take the Vodafone case. As per my knowledge, Vodafone will recover from this situation. Challenges, whatever challenges are there -- they are still best play masters when it comes to my section of the industry. And management is also very professional. At times, they are better than all other operators. So we hope they will recover. Possibility is there. And with the support of government, yes, it is possible because nobody can afford having only two operators. So that -- my knowledge in this, this thing is Vodafone is not going down anytime soon. So I'm very hopeful, and I think we all should be hopeful for that. About BharatNet, anyway, we don't operate on that. So BharatNet is always [indiscernible]. I'll not comment more. BharatNet is not -- is a very low-margin business.
Yes, sir, you were mentioning it last time around. And I just wanted to understand if you have changed your view.
No, no, I have looked into it, but still, it has not come to a level where we can -- if we -- see, we work in a different way. We put all the efforts in best quality. So they are -- very few people appreciate best quality. They are not able to pay for it. So we don't operate on that.
Right. Sir, my second question is on the EBITDA margin trend. So it's very seasonally a seasonal business because of the seasonal rains and there sometimes there is a lot of heat also, work gets impacted from time to time because of weather situations. So how should we look at the margins for the entire year? How do you see the margin trajectory...?
You refer my balance sheet, sir, previous balance sheets. You will find out the pattern. Clear cut pattern will be there. It is always a little bit low in second quarter and next 2 quarters do more than double of the first 2 quarters. [indiscernible] pattern because heat wave will come after March.
Right, sir.
So April, May, June, July, August, September. These are the quarters where we don't do book. And October onwards...
I was not looking for quarterly.
Sorry.
Sir, I was not looking for quarterly variations because quarterly, I understand there will be massive variation. There is no point even looking at it. I was wondering if I look at your full year -- the full year picture, which balances out all the seasonality. So in FY '23, we were at 22% margins and then the scale grew and the margins for FY '24 were at 15%. Now what should we take as the base as we move towards our targets of, let's say, INR 1,000 crores? What should be the...
When we move to INR 1,000 crores profit margin will be slightly lower because when volumes increase, profits decrease. So you reach there, I'll have to make some concessions. Without that, I won't be able to reach there. So I may not have that consistent high profit, but fair profit will be there.
Sir, is there a level below which you then just walk from the position?
Yes, definitely. if I'm not making net in hand 10%, then I don't go into it.
The 10% PAT number is a good estimate, sir, for the entire company?
For entire year, I think it's a fair estimate.
It's a fair estimate.
It will be slightly higher than that, but 10% is the estimate which I stick to.
Perfect, sir. And final question, sir, what all was discussed in the previous con calls, anything -- any updates on that after this quarter? Would you like to change, improve the guidance, decrease the guidance or remain steady fast, your plans have not changed. The outlook has not changed.
No, nothing till now, nothing has changed. It may -- I may give you better results if something additional comes up. We are participating in multiple tenders. And even if one of it clicks, then figures will definitely more positive. Because right now, election is there in Maharashtra. So it is slowing down our work. But then it is just a matter of 3 days.
Have a speedy recovery. All the best.
The next question is from the line of Hardik Gandhi from HPMG Shares.
I hope you are getting well and hope for a speedy recovery. I was just looking at the numbers for this quarter. So in the first quarter, you mentioned that there were nationwide elections, everything that affected the -- in the second quarter, it was rain and the third quarter, it's back Maharashtra election.
No, but it is just a matter of 2 days. So now nothing is scheduled. So don't worry about it. We will be able to reach the targets.
Yes. So that's what I was getting to because earlier, we gave a projection of INR 400 crores this year, then it was revised to INR 300 crores. So...
Fair projection will be -- right now, what seems is INR 300 crores to INR 400 crores between somewhere. And if something additional comes out, which is in pipeline because mostly the government tenders and things are there, unless they are awarded and we start the work, we cannot depend on that.
Yes, of course.
So I don't count it inside, but there are tenders in pipeline. So we may give better results.
Yes. So -- but to be more sure, are you saying that we'll have like 3-digit top line in the next 2 quarters? Because right now it's INR 50 and INR 41 crores for the past 2 quarters. And to reach the INR 300 crores goal, we have to do INR 210 crores in next 2 quarters.
Yes, that is very well possible.
Okay. Understood. Sir, on the last con call, we discussed that there was a tender which was like just about timing pending. And you said you'll update us in the first week of October, first or second week. And any update on that one because I don't know if it fell through or is it work in progress?
It is work in progress till now.
Understood, sir. Understood. Okay. And going forward, have there been any material changes as to -- any material changes as in right now, the project -- the revenue which we are looking at, majority of it comes from which segment?
Sir, it is 30% telecom and 70% construction. EPC.
Okay. 30-70. And who is -- like are we getting direct EPC contracts from the government or if it is -- we are subcontracting?
No, we get the good, build, operate, own and transfer. So EPC is always ours, when it is telecom. When it is other construction activities, then it is through the principal contractor and we get a subcontractor.
Okay. So EPC is all as and then telecom is also. So...
Yes.
So how much of the EPC is asked and how much are we subcontracting -- because in the PPT, it was written, we got a contract from a different player, I don't know, just one second. You got a contract...
See, what I am referring is mostly about the revenue collection.
Correct.
[Foreign Language] contracts to keep it is for 2 years and 3 years like that. So what we will be able to achieve, that is what I'm talking. What will be measured and billed and paid.
And going forward, that this year, we reach INR 300 crores. In the next year...
We will definitely reach INR 300 crores plus. INR 400 crores is something because of two elections and the monsoon and all those things. So I'm a little bit skeptical. I will try to reach there.
Yes, sir, of course. I think INR 300 crores is also a very good number to reach this year, which shows the ability...
We have to reach there because if we want to complete the project and if we don't go with full speed, then it will be affecting my margins, my profit.
Do we get a bonus from government if we complete...
Nothing. Nothing.
Nothing.
We get paid by telecom companies, not by government.
Okay. Okay. Yes, sir. And sir, so going forward for the next year, then for the INR 1,000 crores, how much will be the split between telecom and...
See, normal split is 30-70. It will be like that only. Yes, some additional things we are trying to do related -- in related fields only. So that may affect our this percentage. Some additions will come, which will not fall into complete telecom, not fall into complete EPC. It will be some mixture and things. That announcement will come in December once all contracts and things are signed and in place.
Yes, sir. So just to be sure, by when will the tenders be awarded, any approximate maximum time like within.
You are asking me to get some government work, that is difficult.
Not at all, not at all. But, oh but asking -- sorry, I don't know if this might be a triggering one, but given that there are elections right around in Maharashtra, will any change in political party affect us?
No, no, we don't get affected, but the decision-making process gets halted.
Correct. Definitely.
That is the issue.
Okay. Okay. Understood. So on an optimistic basis, we are looking -- the tender should be awarded within a year's time, like at least by the time we close.
No, no, before the year-end, this financial year end.
Before this financial year end.
Yes.
Hope you'll get recover soon.
The next question is from the line of Prakash, an individual investor.
This is Prakash. Am I audible?
Yes, sir. You're audible.
In fact, most of my questions have been answered. I had similar questions about in terms of this quarter revenue and whether we are good in terms of the projections. I just have one follow-up question. Most of the questions have been answered by you because this is a seasonal quarter. We are sticking to our projections for FY '25. Last time, when you talked about an order for a 700-kilometer new order, and you said that we would have some good news in 15 days or so, this whole tight for 15 days. Is that still on the table? And did we get any outcome of that.
It is still on the table. We have to wait till this election result on 23rd. Maybe by 25th or so, I will get the things cleared. We wait for another 15 days.
Sorry, sir, go ahead.
But it is positive.
And is it going to add to our FY '25 and FY '26 projection and how much revenue...
It all depends on the closing figures, now how we close that order. So unless the finalized -- negotiated figures are not finalized and then we have it in black and white, I will not hazard a guess.
And in fact, I heard you speaking to a few of the investors and letting them know that we are on track for INR 300 crores to INR 400 crores this year and INR 1,000 crores next year as well. That is very good news. And hope you recover soon. Thank you very much.
Thank you for your good wishes. Thank you.
The next question is from the line of Krian See, an individual investor.
My first question is after the completion of Nagpur-Mumbai Highway, what is the revenue expectation from the telecom side, which have been laid of optic fibers per year?
Sir, we have is -- our model is we get paid every 3 years for the optic fiber, and that will continue for 25 years.
What is the revenue expectation for -- after completion of complete project for 3 years?
After completion, we get is INR 1,500 crores divided by -- minimum INR 150 crores.
For 3 years, am I right?
Yes.
The next question is from the line of Pradip Nagadia, an individual investor.
I hope you recover soon, sir. So I have two questions. Last time you spoke about in the con call regarding that you are expanding your team. You are bringing in new people on the Board. So can you please throw some light as to where we have progressed on that line?
Yes, we have got three manager level and two supervisor level additions. They are being briefed and trained for the Samruddhi project. And we are going to take additional couple of people because this is very long.
Sir, am I audible?
Can you please repeat the question?
Yes. Sir, I just wanted to ask last time in the con call, you spoke about building the team and bringing in new people in the management side. So can you please throw some light as to where we have progressed in the last 3 months? Am I audible, sir?
Yes, yes. But I have already answered number of manpower taken and a couple of more will be taken.
Sir, my question was regarding to the top management. You said you'll be bringing some [indiscernible].
[indiscernible] additional. We need it as a managerial level, second level. And we already have consultants with us. We have all [indiscernible] senior level people who have already worked in telecom, and they are our consultants that look after the things like meeting all telecom and all, but we have a consultant this thing. The person who represents me is the consultant with 30 years' experience in the telecom line, and knows everyone. So he does the follow-up. I don't have to personally do that. That is already taken because once we got the Samruddhi project, we needed that.
Okay, sir. Sir, my second question is with respect to something you spoke about in the last con call when I've asked you regarding your 2030 vision. And you shared that you have plans to enter in the defense side in the deep-tech technology, where you have plans to do something for the Indian Air Force. So can you throw some light as to where we have reached?
We have already approached DRDO through [ IRT ] where we have an incubation. My son's company is there and presentations and things are done. Soon, we will get the call from concerned people.
So, right now, it hasn't progressed.
It is work in progress.
Got your point. So would you like to throw some more light on it? Or maybe we should wait for some announcement?
No, no. Process is on. This is a government process, and it is always very slow.
Fair enough, sir. And sir, my last question is, you gave us a guidance of INR 300 crores to INR 400 crores. Can you throw some light as to what will be the margins in that?
It will be standard 10%. Definitely.
10%.
Yes. It will be 10% definitely. It can be 11, it can be 12.
The next question is from the line of Manoj, an individual investor.
Most of my questions have already been answered. I just wanted to understand about the Samruddhi Highway as to what's the progress till now? How much of it has been completed and we were supposed to get paid every 100 kilometers. So what's the progress on that?
See, because of this election, the permissions and things got delayed and monsoons also was very late. Up to 15 -- 16th October, it was still raining. So we couldn't -- I mean, our machines don't work on the wet [indiscernible]. We had to wait. Now it has started, but we will be able to reach whatever is there, we will increase the number of machines.
Yes. In the last con call, you had also mentioned that you were purchasing some additional machines for the road work.
Yes.
Has that been done? Have those machines been purchased?
Machines are purchased already.
All right. And you also mentioned that you will get paid every 3 years. So how does that work? I mean, for that 100 kilometers.
I'll make it clear. One moment, I have a call. Please hold. Sorry.
Yes. I was asking for the status of that. I mean, you were explaining how the payment cycle works for the Samruddhi Highway.
So first is when we are doing installation, we take a good chunk of money from telecom before handing over the project. out of 6 -- if I'm giving one duct, I will take sufficient advance payment. And then every 3 years, it is split. 15 years is the basic concession and another 10 years is additional extended. So there, every year, we get about INR 152 crores from one telecom.
Okay. So for every 3 years, you get paid in advance or after the end of the 3 years?
Yes. Yes, it is always advance.
It's always advance. Okay. That's great. And is there a time line for when we can...
Most of my construction costs will come when I hand over, but then there is fees or rental paid to MSRDC and rental is collected from the telecom. So that is 3 years process. Every 3 years, we do that.
Right. I mean I understand it's a cash out business, but is there any time line on when we can complete this and hand over so that this can accrue.
We completed in 1.5 years from today.
Okay, 1.5 years. All right. So it's safe to assume that we will get this income in FY '26. FY '26 onwards this election.
Some will come in '25 and -- some part will come in '25 because we hand over at least 200 to 300 kilometers...
Yes. And in FY '26, we'll hand over the whole thing, so we'll get the 3-year payment, right?
Yes. That is why this project is INR 4,000 crores.
Correct. Correct. And also one more question. I mean, in the previous con call, you said that the bulk of the lease income comes in the fourth quarter. So how much percentage of our annual turnover is the lease income?
You people ask so difficult question. Vodafone will pay some time. Airtel will pay in a different mode. Jio is again a different ball game. So actually projecting is very difficult.
No, no. Okay. So your major income is coming in the fourth quarter, right, for the lease income? I mean plus or minus a little bit here or there.
Yes.
And if you projected the INR 300 crores to INR 400 crores for this year, so it's safe to assume that a INR 30 crores to INR 40 crore PAT should be possible this year. 10% margin.
[indiscernible]
No, no, PAT. PAT. 30% to 40% PAT.
PAT will be -- it is 300, yes, it will be there.
The next question is from the line of Swami, an individual investor. Since there is no response from the participant, we'll move to the next. The next question is from the line of Mayank, an individual investor.
Yes. So my question is very specific to the financial statements. So there are just two parts which I want to ask very specifically. So the first part is that in the balance sheet, I see that the trade receivables is around INR 96 crores. So I have understood from the previous con calls also that the payments are delayed. So I just wanted to understand like if we have got INR 41 crores of revenue in Q2, like what portion of was like actually developed in Q2 and we got the payment within Q2? And how much of it was from the previous quarters as a roll-off?
Our new model of business, it is very difficult to split it into quarters.
Okay.
All right. Okay. Because it is required, we are doing the accounting accordingly. But what I have completed in quarter 2 will be paid in quarter 3. So, figures, it is really always advisable that it is seen not quarterly, but yearly.
Okay, sir. And my second question is again from the profit/loss statement. So like I understand there has been some concerns that the margin has gone down. But personally, I don't think like the overall performance was quite bad. In fact, most part of the -- like profit part was good. Probably the only thing which has drawn down the margin in this quarter as compared to the previous quarter or the previous year is the changes in inventories of goods and work in progress. So like same quarter last year, it was minus 406. And previous quarter, this year, it was minus 165. But this quarter, it has come back into the positive score of 513, which has, I think, brought down the overall profitability. So I just want to understand like why has this work in progress increased so much? And -- is it because of something like expanded work that we are expecting in Q3 and Q4?
Sir, we have -- see new project has started. Inventory is built up because we have -- every day, we do 3 to 4 kilometers of trenching and ducting. For that, I have to have stock for at least 1 month. So work in progress and these things will keep increasing until work is completed. I think I've understood correct and answered rightly.
Yes, sir. So that was basically what I was thinking. Actually, many people have been very impressed by the revenue growth, but people have been complaining a little about the margin. So this is something that struck me, like it is not something to worry about, but more like in the Q3 and Q4, we will actually see the good results coming in. So I just wanted to confirm that from perspective.
Yes. That is right. Because our total performance is always in Q3 and Q4 only. Q1 is because of extreme heat and then we are wrapping up the things.
Correct. So I think what I understand is even the margins will also improve. So obviously, another INR 200 crore plus even if we get through revenues, that will be there. But even we can expect like margins to go above 10% because this quarter, the margins have gone down to 7%, probably because of the inventory pile up. It is not because of a lack of efficiency or something. So I wanted -- yes, that is the message. I just wanted to give to the rest of the investors also because there has been a bit of panic. But this is the like hidden meaning of the P&L statement...
We are growing at the rate of 300%. What is there to panic?
Yes. Actually, people got a little scared about the loss in -- the decrease in margins. But, sir, I'm very satisfied with your answer and all the best, and that was all I had to ask. So all the best for your company and for your health, sir.
[Operator Instructions] The next question is from the line of Suman Kumar, an individual investor.
We are giving a projection of [indiscernible]
I'm not able to hear you clearly. Can you please speak a little louder?
Is it -- can you hear me now?
Now it's good.
We are giving a forecast of around INR 300 crores to INR 400 crores of revenue [indiscernible] Last year it was around INR 90 crores -- sorry [indiscernible] close to around [indiscernible] we're expecting. Are you seeing a requirement of capital raise in the next year? If yes, then what is the plan like how much capital would be required to meet the revenue?
Additional funds, definitely, we need. I'm waiting for one more tender to be realized, then I can justify the need, and I will definitely come.
But we will be able to do it.
We will need additional funds once additional orders are in pipeline. And that time, we will definitely approach again.
I get that. But are you saying that we would require additional -- I mean, additional tender to deliver the FY '25 numbers...
As I have already said that I'm waiting for additional tenders to come through to be awarded. Once that is there, then I'll be definitely needing some funds and then I'll approach.
But not to deliver FY '25 number. Is that what you're saying?
This is already taken care of.
The next question is from the line of Sanjay Jain, an individual investor.
I wish speedy recovery for your health. My question -- first question is like although we have a seasonality in this quarter of rains, still if we compare our September quarter to September quarter, our revenue has grown by 4x, INR 10 crores to INR 40-plus crores, but profit has declined from INR 2.62 crores to INR 2.42 crores.
Yes.
I can -- so one, I want to know what is the reason for that. Hello?
Line got silent.
No, no. I asked my question. Like although I can understand there is seasonality in this quarter of September due to rain, still our revenue grew from -- if you compare with last year September quarter, our revenue grew from INR 10 crores to INR 40 crores. It's almost 4x. But still our profit declined from INR 2.62 crores to INR 2.42 crores.
Sir, because of increase in stock, inventory.
So in this accounting standard, don't we take care that because this can impact like give a very good, very wrong impression of results to the public or investor. So is this the right approach of accounting standard where like it impacts our whole profit because if we have not accounted revenue in current year, won't it be fair that the work in progress is also adjusted accordingly?
Let me discuss with my chartered accountant, please.
And, yes, another thing.
He is with me right now.
Yes, I'm waiting for the answer.
Yes, sir, your suggestion is accepted. We will look into it. Next time, you will see accounting in a little slightly different way.
Yes, sir. That is important because ultimately, what your balance sheet shows or your P&L shows, market takes that rate from that only. And second thing, sir, as our 6-month revenue is INR 90 crores and our -- this thing is INR 96 crores, our like borrowing -- sorry, borrowing, I'm saying our debt. So what is our turnaround for our -- getting our payments? Because almost INR 90 crores to 2 quarter turnover and INR 96 crores pending payment...
The turnaround time -- Yes, I've got the question. The turnaround time is normally 90 days to 120 days. Because work is always in progress.
Okay. But in this case, it seems that whole amount has gone into a 120-day cycle because 120 days turnover is INR 90 crores and receivable is INR 96 crores.
You got it right.
Another question, sir, although another participant has asked regarding Vodafone, we also hope the Vodafone survives well and it does well.
It is good for everyone, sir.
Yes, good for everyone. But still, if there is something wrong with Vodafone, how much impact it will have on our business?
Sir, that will have real impact is about 15% on the telecom revenue. That is why we have diversified into infrastructure and telecom both. So even if one site goes weak, then we can recover from the other. We can maintain our profit margins and top line and bottom line.
Sir, 15% of telecom business or 15% of total business.
15% to 20% of telecom business.
So it means telecom business is 30%. So if we take 20%, it will be hard.
It's negligible.
6% maximum.
Yes, yes. If I say it is negligible, then it is a little, arrogant. So I [indiscernible] this.
Okay, sir. And second thing, margin-wise, what is the margin in telecom and what is the margin in rest of the 70% business?
Sir, I don't want to answer this. Telecom is almost more than 50%, 60% margin, because we invest, once the investment is done, then it is always collective.
Okay. Okay. Okay. But if you take most of, most of money invested in initial phase, so then how does it work?
I didn't say.
Sir, because [Foreign Language]
Sir, if you are somewhere in Mumbai or around, I will suggest you please come personally and understand this part.
I'm from Delhi NCR, but like to...
Whenever you are in Mumbai, please take time and come.
Sure. Sure.
It's a little complicated. It cannot be explained on con call.
And can you explain, sir, the rest of 70% business, what kind of contracts we are doing in that 70% of business?
We are doing the work. [indiscernible]
Pardon?
Normally, it is part of road construction process. In telecom also...
Also, so you can deliver your projected revenues in time to come.
No, we will definitely reach our projections. Yes, INR 1,000 crores is a challenge.
INR 1,000 crores challenge or achievable?
No, it is a challenge. I mean we keep -- I'll be happy to do it. It is doable. Otherwise, I will not give the projection.
The next question is from the line of Shubham, an individual investor.
Yes. Sorry, I joined a little late. So I definitely would have missed a core part of a little lesser revenue for this quarter. But I'll read through the transcript when it is published. But for the rest of it, Ravindra Ji, as I can over here the last few questions, everything is on track of the projection at least for the current financial year.
Yes.
Okay. So there's no surprise or anything -- nothing in the line.
No, no surprise at all. Whatever is projected will be done, 5%, 10% margin you have to give because of demographic, government election and all those things which affect our working. But variation won't be more than 5% plus/minus.
Got it. Got it. That makes complete sense. And also, I'm assuming the -- from where we are right now to looking at FY '25, '26, the INR 1,000 crore projection is also coming along. I heard you saying that it's challenging, but that's what we are aiming for.
If challenge is not there, there is no fun.
Yes, yes. That's good. That's good. No, I would stress on that. I think I got larger part of the understanding of what reduced the profit margins, et cetera, was also...
No, no, no. Sir, let me explain. Our profit margins don't depend on quarterly work, but accounting has to be done properly only. The margins and things, everything is on the real -- really effective is a year. Quarter-to-quarter, this is not the industry where you will get quarter-to-quarter. It's specifically in infrastructure.
Fair. No, I understand it now, but I think it would have been better if you would have got that kind of understanding even in the initial -- when we have multiple other meets or the historic meets that we had. But this clarity now, which is now coming through post facto result is a little surprise, at least to me. But I understand now that this is largely to be looked at a year-on-year basis, not on a quarterly basis, which is fine.
Yes, sir. Yes, sir.
And we are largely aligned with the overall broader margin expectation from a year-end per se, that remains intact. It's the quarterly fluctuation that is impacting the current margins and the current numbers. Is that a fair understanding?
Sir, correct.
Sure, sure. So we have largely -- Ravindra Ji, as you also keep saying that larger part of the revenue and the corresponding profit margin then has to be largely skewed towards Q3 and Q4, which, as you said, is all aligned and there's no surprise here and there.
Yes, sir.
Thank you. As that was the last question for the day, I now hand the conference over to Mr. Ganesh for closing comments. Over to you, sir.
Thank you, everyone, for joining the conference call of Kore Digital Limited. If you have any queries, you can write us at research@kirinadvisors.com. Once again, thank you, everyone, for joining the conference call.
Thank you. On behalf of Kirin Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.
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