3i Infotech Deepens Strategic Investments in Cloud-First and Edge-Ready Products
3i Infotech Limited (BSE: 532628, NSE: 3IINFOTECH), a leading digital transformation and technology solutions provider company, today announced its consolidated financial results for the Q1FY24 ended June 30th, 2023.
The company’s transformation strategy focuses on building new capabilities and competencies to accelerate penetration and revenue mix change around the globe with improving margins across the business. 3i Infotech is committed to creating highly customized, country-specific business models that will deliver significant value at the right price. The company will also be leveraging its NuRe Bharat Network to capitalize on advertising potential by connecting with prepaid segments and providing visibility and business opportunities to medium and small enterprises throughout India’s vast and diverse regions. This initiative will be undertaken while monetizing operations to deliver profitable results. Further to its traditional BFSI focus, 3i Infotech will also target mid-tier companies in the Telecom Media Entertainment (TME), manufacturing, and healthcare verticals.
The company reported consolidated revenue of Rs 194.4 crore in Q1FY24 with a growth of 8.5% YoY and 2.1% QoQ; Gross margin of 16.5% with a growth of 5.5% YoY and 0.5% sequential QoQ. During the quarter the company has added 38 new contracts from existing & new customers. The company has strong visibility of deals which will supplement the new wins for the year. Utilizing its innovative products and technologically powered platforms, 3i Infotech’s revenue mix is shifting from classic enterprises to next-generation businesses.
Commenting on the Q1 FY24 results, Mr. Thompson P. Gnanam, Managing Director and Global CEO, of 3i Infotech Limited said, “We are pleased to report revenue growth of 8.5% year on year, driven by a consistent effort to establish new services under the NuRe brand and to expand into new locations and sectors. We have made significant investments in new business models with the purpose of being future-ready, and we aim to monetize and develop our strategic investments in the cloud-first, digital inside cognitive-powered, and edge-ready products by establish new services under the NuRe brand and to expand into new locations and sectors.
Our NuRe Bharat Network (RailTel Project) is commercial ready. Despite an impact on our profitability due to the pre-operating cost & minimum guarantee payments in Q1, we are excited on the prospects of the same as there is a large order funnel building steadily.”
Key Business Announcements
- Awarded contract by Bajaj Electricals for specialized managed infrastructure services, cloud management, database management, and IT application support with a contract value of Rs. 18.7 crore over 5 years, plus one-time roll out service fees costs of roughly Rs. 60 lakh
- Won Managed Services Deal of Rs. 42.6 crore from a Leading Indian Pvt Bank, spread across 2 years
- NuRe FutureTech signed a memorandum of understanding (MoU) with SRM Valliammai Engineering College in Chennai to establish an AI (artificial intelligence) lab within the institute’s campus.
- Awarded a contract from IOCL for managed services of Rs. 16.3 crore to 3i Infotech
Other Business Highlights
- In Q1 FY24, Application-Automation-Analytics (AAA) was one of the highest revenue contributors with Rs 128.2 crore followed by IMS revenues of Rs 31.4 crore
- Q1 FY24 Revenues for the US region was Rs 85.4 crore a growth of 3.7% YoY, followed by revenue from India region was at Rs 81.5 crore a growth of 37.8% YoY
- From a vertical standpoint, Banking & Financial Services (BFSI) is a major contributor in total revenue with a 34.1% revenue share while Information Technology has a 27.9% revenue share in Q1 FY24
- CloudFirst reported revenues of Rs 6.8 crore with a GM of 29.2%; an increase in the revenue by 186% YoY & 59% QoQ
- Digital IMS (DIMS) has grown with revenue of Rs 31.4 crore with a GM of 16.3%, an increase in the revenue by 5.7 % QoQ and 25.6% YoY
- 38 logos added by the existing and new customers in Q1 FY24 primarily from Oil & Energy, BFS
- New contracts from existing North America BFS clients worth USD 2.4Mn TCV added in Cognitive computing, customer experience transformation and digital infrastructure management
Key Highlights of the Consolidated Financial Performance
- The quarter ended June 30th, 2023
- Operating Revenue was Rs 194.4 crore, up by 2.1% QoQ and 8.5%YoY
- Operating EBITDA (before RailTel MG costs) was Rs 1.3 crore which is up by Rs 8.2 crore QoQ and Rs 7.5 crore YoY