ABM Knowledgeware Ltd Management Discussions

A. Industry Structure and Development:

E -governance in India has some notable strengths such as:

Digital Infrastructure: India has made significant strides in digital infrastructure, including widespread internet connectivity and mobile penetration.

Government Commitment: The Indian government has demonstrated a strong commitment to e-governance, as evidenced by initiatives like Digital India.

Citizen Participation: E-governance encourages citizen participation, transparency and accountability.

Efficiency: Automation and digitization streamline processes, improving service delivery efficiency.

Despite its growth, the E-governance sector has some weaknesses. There is still a digital divide, with rural areas lagging in access to technology though it is being bridged fast due to internet and connectivity.

Similarly, as e-governance expands, cybersecurity threats become more pronounced, as can be seen from many recent examples. Governments are making serious efforts to minimize the impact. Even then, it has been observed that some nations are adopting cyber attacks as a tool to create disruptions in targeted countries.

Bureaucratic inertia and resistance to adopting new technologies often hinder implementation. Resistance to reengineering age-old processes, a lack of commitment to pursuing cost and quality-based procurement, and a lack of continuity in the event of a change of E-gov Champion are often seen as weaknesses of the sector.

By and large, the industry is dominated by regional players as large companies are seen to be very selective in bidding for projects.

B. Existing Opportunities and Outlook:

Advent of AI has generated a lot of interest among customers. While there are no adequate use cases that can be scaled, enough efforts are being made to use AI in administration.

Technology and its implementation are, by far not the challenging factors. The success of e-government hinges on adoption and sustained use by overcoming initial rejection and resistance. These areas need continuous focus, as transparency and citizen participation would improve significantly as a result of these aspects. It can throw open opportunities like Inclusive Growth whereby, E-governance can bridge gaps and ensure inclusive growth by reaching marginalized populations. The use of AI and Data Analytics can enhance decision-making and policy formulation. It can open horizons for Collaboration with the Private Sector, accelerating innovation and service delivery.

ABM has Order book of 148 Crs to be executed in next 3-5 years.

C. Business Threats:

ABM experienced challenges due to brisk political developments in its home state of Maharashtra last year and the Code of Conduct this year due to parliamentary elections. Maharashtra will hold municipal elections shortly. Five states including Maharashtra will hold assembly elections in the second and third quarters of 2024-25. The restrictions of the Code of Conduct for these elections would significantly slow down the opportunities.

At the same time, ABM has intensified its diversification efforts to reduce dependence on a single business segment and geographical area. These efforts have continued but with a mixed success. It is impacting Order booking.

The investment in the associate Agritech Company Scanit in Silicon Valley, USA, will continue during the year. Scanit will take 1-2 years to become profitable as we find a good response to the products of Scanit. Till then it can impact the Balance sheet of ABM.

GoI has also undertaken an initiative to provide a municipal ERP to willing states free of cost through empanelled Implementation Partners. ABM is executing the same in two states for Online Building Plan Approval. This is a new product and a new technology for ABM, and ABM has to undergo a steep learning curve. The product is also evolving, thereby posing challenges to users as well as System Integrators like ABM. This is likely to cause Time and Cost overrun while developing new skill for ABM to repeat the same in more states.

All these can subdue the revenue and profits of ABM substantially during 2024-25.

D. Business Strategies and Planning :

ABM has certainly achieved leadership in the niche of e-municipality in India, with sustained profitability and performance that are unmatched by any of the competitors. However, these achievements have come at the cost of growth on the top line, as we have experienced in the past. ABM has been observing the adverse results of aggressive sales strategies of many small and large companies in this segment and has opted for a cautious approach. The experience of this segment, however, has been tough into successful execution and recovery of outstanding. Hence, ABM has intensified its ongoing efforts to diversify. There will be selective bidding in the core segment of e-municipality, which can result in a drop in the order books for a year or two. Areas such as technical manpower augmentation and Agritech start-up investment will remain priorities.

E. Human Resource Management :

ABMs objective is to acquire, develop, utilize, and retain efficient employees for mutually rewarding associations.

ABM thus continues to stay on course with its approach to human capital management by supporting and enhancing the organizations goals and objectives. This involves a range of strategic interventions and activities such as:

• Inclusive Work Culture:

Promoting diversity and inclusion within the workplace to ensure all employees feel valued and respected. • Employee Motivation:

Implementing programs and initiatives that boost employee morale, satisfaction, and productivity.

• Learning and Development:

Providing continuous training and development opportunities to help employees grow their skills and advance their careers.

ABM has always believed in upskilling and reskilling employees to prepare for current changes. These activities also help businesses handle fast-approaching developments that require more agility. The company has renamed training sessions as workshops to maximize the benefits of quality learning interventions. A workshop is an interactive meeting where a group of people engages in activities to solve a problem or work on an assignment using various tools and techniques.

During the financial year 2023-24, ABM initiated multiple workshops for employees in various roles. These workshops have not only enhanced employee skills but also improved the quality of support provided to our clients. Additionally, these enhanced employee capabilities are helping the organization sustain existing business and seize new opportunities. The workshops were delivered both online and offline.

To name a few, below were the workshops:

• Effective Business Communication