Although the growth in the retail segment seems impressive, this has come on a lower base where the segment reported 26% yoy decline in Q4FY17. The retail segment, which accounts for ~80% of the overall revenue, has recovered well after set back from demonetization in H2FY17 and GST in H1FY18. On Full year basis, the consolidated revenue grew by 6.1% yoy to Rs318.3cr on stronger performance of enterprise & govt. segment (up ~14% yoy), while retail was down by ~1% yoy. As a result, the contribution of enterprise & govt. segment has increased from 17% in FY17 to 19% in FY18. This augurs well for the company as renewal ratio for the enterprise & govt. segment is higher at 75% v/s 35% for retail segement.
On the operating profitability front, the company was able to report 1,546bps yoy expansion in EBITDA margin for the quarter to 55.1%. For FY18, the company reported a 776bps yoy expansion in EBITDA margin to 37.8%. The quarterly expansion of margins was largely owing to lower RD cost and Selling and Marketing cost (S&M). The RD expense declined by 437bps yoy for the quarter and S&M declined by 680bps yoy. The profitability was further aided by lower direct cost (down 119bps yoy, Q4FY18) and General Administration (G&A) cost (down 310bps yoy, Q4FY18). For FY18 R&D, S&M, S&M and G&A were down by 336bps yoy, 117bps yoy, 241bps yoy and 81 bps yoy, respectively.
The company reported 121.6% yoy increase in consolidated net profits for Q4FY18. The net profit rose to Rs49.2cr in Q4FY18 vs Rs22.2cr in Q4FY17. While the same for FY18 grew by 41.4% yoy to Rs78.7cr. However, there was a service tax credit amounting to Rs6.6cr in both Q4FY18 and for FY18, which increased the consolidated net profits.
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