Dc Infotech and Communication Limited — Call Transcript 2024

Jun 7, 2024

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Date: 07[th] June, 2024

To,

To, To, Compliance Department. Compliance Department. National Stock Exchange of India Ltd. BSE Limited, Exchange Plaza,Plot no. C/1, G Block, P.J. Towers, Dalal Street, Fort, Bandra-Kurla Complex Mumbai – 400 001. Bandra (E), Mumbai - 400 051.

Symbol: DCI ISIN : INE0A1101019

Subject: Link and transcript for Audio Recording of Earnings Conference Call of DC Infotech & Communications Limited – Q4 & FY24 Financial Results

Dear Sir/ Madam,

Pursuant to the provisions of Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015, please find below link and transcript for audio recording of Earnings Conference Call of DC Infotech & Communications Limited held on 05[th ] June 2024 at 11:30 am to discuss the Company’s business and financial performance for Q4 & FY24.

Link https://www.mediafire.com/file/ff46xrifatllx8s/DCinfotechCommunication-05062024.mp3/file

Kindly take the same on record.

Thanking you

For DC Infotech & Communication Limited

Digitally signed by CHETANKUMAR HASMUKHLAL CHETANKUMAR TIMBADIA DN: c=IN, o=Personal, pseudonym=aGa2xq82poKnVEvInhSF2zbFhRuIKKR3, 2.5.4.20=a48aa829449c2fc176ba693f4ec8ed1302fc1784 HASMUKHLAL 8f16d7cc4792267ac4b65785, postalCode=400057, st=Maharashtra, serialNumber=58b00f9601167d03e912530e1ae65c80fc 47528b6483e342960b0f14bf3dee8a, TIMBADIA cn=CHETANKUMAR HASMUKHLAL TIMBADIA Date: 2024.06.07 18:07:41 +05'30'

________

Mr. Chetankumar Timbadia Managing Director DIN No: 06731478

DC Infotech and Communication Limited

Registered Offi: Unit No.2, Aristocrate, Lajya Compound, Mogra Road, Andheri (East),Mumbai - 400069, Maharashtra, India Telephone No. 022 28329000(Hunting), Email: info@dcinfotech.com website : www.dcinfotech.com CIN :U74999MH2019PLC319622

DC Infotech & Communication Limited Q4 & FY24 Earnings Conference Call

June 05, 2024

Moderator:

Ladies and gentlemen, good day and welcome to DC Infotech & Communications Limited Q4 and FY24 Earnings Conference Call.

As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing * then 0 on your touchtone phone. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on date of this call. The statements are not the guarantee of future performance and involve risks and uncertainties that are difficult to predict. Please note that this conference is being recorded.

Today, from the management side, we have with us Mr. Chetankumar Timbadia – Managing Director, Mr. Devendra Sayani – Whole-Time Director and Mr. Piyush Shah – Chief Financial Officer.

I would now like to hand the conference over to Mr. Chetankumar Timbadia – Managing Director from DC Infotech & Communications Limited. Thank you and over to you, sir.

Chetankumar Timbadia:

Thank you, Michelle. Good morning, everyone. I would like to wish you all a very warm welcome to DC Infotech & Communication Limited earnings conference call for the fourth quarter and the full year ended 31st March 2024.

I would start by thanking everyone for being here today and joining us on this call today. With me today is on call, Mr. Devendra Sayani, Whole-Time Director and Mr. Piyush Shah- CFO and Ad Factors – our Investor Relation team.

Speaking about the company's business, it was established in 1998. DC Infotech has been specializing and providing innovative networking, unified communication and data security products and solutions by utilizing the latest technology. Over the years, we have been able to establish ourselves as the leading company and solutions, sales and support of networking UC and security products and services. Our core competency are in understanding existing network and future needs. We excel at first understanding the need and then design and deploy an effective functional network. Also adding to that, we have an exhaustive range of POC appliances and solution for different industry vertical and have done security implementations with major installations pan India.

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I'm excited to share some update about our company and our achievements over the past year before we dive into the details of our business and financial performances. We are proud to announce for the second time in a row, DC Infotech has been featured among the top 500 fastest growing company in Asia Pacific region for the year 2024 as recognized by Financial Times. This esteemed ranking underscores the Financial Times recently released in its 6th edition of FT High-Growth Companies Asia Pacific 2024 Special Report, highlighting the companies that have demonstrated exceptional growth and resilience amidst challenging economic conditions between 2019 and 2023. We are honored to be recognized among this esteem companies for our remarkable achievements during this period; DC Infotech & Communication Limited exceptional growth trajectory, commitment to excellence, innovation and sustainable growth in this dynamic technology field, which solidifies its position as a powerhouse of networking and security solutions sector. We have received the highest value contribution awards from Samsung for its exceptional work in digital signage. This award was presented at Samsung’s Award Gala and recognized DC Infotech’s dedication and outstanding contribution to digital signage field. The award highlights the company's innovative solution and its ability to deliver high quality services which significantly contributes to digital signage industry. At MSME Startup Expo 2023 organized by Confederation of Indian Traders CAIT, DC Info was honored with Udhyam Ratna Award 2023. This award is given to companies who demonstrate outstanding services and achievements in field of Trade and Industry. This Startup Expo serves as a platform for SME startup service providers to network and showcase their product and services, and receiving this award as such a prestigious event underscores DC Infotech’s impact and leadership in the industry. This achievement reflects our commitment to excellence and innovation in providing top notch solutions in the IT sector. We are grateful for the recognition we have received and new opportunities to serve our clients with the best technology and services.

Moving forward, our focus will remain on securing more such segments and expanding our presence in those areas with a view to deliver sustained value to all the stakeholders. Going forward, we want to simplify our segmental revenue reporting as our business primarily is divided into 3 categories; networking, unified communication and enterprise security business.

Now turning to our financial performance, fourth quarter Q4 FY24. We have reported Rs. 154.59 crores of revenue during Q4 of FY24, a 60.74% Y-on-Y rise, growth is mainly driven by large orders executed in the enterprise segment as well as the UC segment. Our EBITDA for the fourth quarter stands at Rs. 6.74 crores, increasing 78.16% Y-on-Y driven by change in mix of products and brands. EBITDA margins stood at 4.36%, an improvement of 43 bps compared to the previous year. Our net profit for the quarter is at Rs. 4.21 crores as compared to Rs. 2.15 crore in the last quarter of FY23. Net profit margin stood at 2.733%, up by 50 bps. EPS for this quarter is Rs. 3.29. Now for the full year, we have reported Rs. 459.63 crores revenue in FY24, a 27.81% year-on-year rise due to strong demand in our products like Samsung, NETSCOUT, Netgear, D-Link, Arbor and other software and services. EBITDA for the full year is Rs. 20.04

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crores, an increase of 57.53% Y-on-Y. Our net profits during the full year is Rs. 11.61 crore against profit of Rs. 7.08 crore in FY23. Net profit for the margin stood at 2.53%. EPS for this period is Rs. 9.51. This is all from my side. Now we can take questions. Thank you.

Moderator: Thank you very much, sir. We will now begin the question-and-answer session. We have a question from the line of Arka Bhattacharya, an individual investor. Please go ahead.

Arka Bhattacharya: I'm pretty happy with the numbers that you have come across. I would like to know regarding the margins that we are having, could you see an increase in margins going forward, that is question one. And second question is regarding the equity dilution. Going forward one more time, are you guys planning to reduce the stake from promoter side? These are the two questions that I have for you.

Chetankumar Timbadia: Mr. Bhattacharya, your line was not very audible, but if I am getting your question you are asking about the margins which have increased, right?

Arka Bhattacharya:

Yes, sir.

Chetankumar Timbadia: So the increase in margins has been our endeavor from the day one and we continue to focus in that direction. And in that line, we are aligning our products with more of services to be bundled in and the product mix which we are carrying as we are trying to get it to an optimal level also, we increase our margins and also with the scale we plan to bring the efficiency also into our operations, which has also contributed to the growth in the margins and we continue to plan to doing that. I think that answers the first part of your question.

Arka Bhattacharya:

Yes, sir. That answers the second part of the question. The first part was regarding the preferential that you have diluted some of the stake, are you guys going to do that going forward any further time where your promoters will be diluting the stake?

Chetankumar Timbadia:

So promoters are not in the mode of diluting the stake. We have done a preferential thing, but parallelly, there has been warrants which are convertible, which has been issued which will be up on conversion of warrants will be again back to what we were, so there is no idea terms of promoters to dilute the stake. As strategically, we are doing some preferential issue, but parallelly promoters are equally committed to the company and its organization and we will continue to keep our stake as of now to the same level.

Arka Bhattacharya: And last like to add one final question to this, what your guidance would be for the next at least 2 to 3 years?

Chetankumar Timbadia: For three years guidance, you are asking me?

Arka Bhattacharya: Yeah, 2 to 3 years…

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Chetankumar Timbadia: Our vision endeavor will be continuing this trajectory of growth 15% to 20% Y-on-Y that should be our endeavor and the guidance for the next 2 to 3 years.

Moderator: Thank you. The next question is from the line of Ketan Athavale from RoboCapital. Please go ahead. Ketan Athavale: So I wanted to know how will be our margins going ahead, how much improvement can we expect over the next 1 to 2 years and what will be the sources?

Chetankumar Timbadia: And as far as the margins is concerned, if I follow up to the answer which I gave, Mr. Bhattacharya, as the scale increases and we continue to bring efficiency into our operations and thirdly, the product mix of adding services to the products which we are getting and more and more solutions offering as we grow, we see that the margins improving to a better level than this and hopefully this trajectory of growth in margin should be continuing the years to come.

Ketan Athavale: So can you give guidance on margins like exact number or a range?

Chetankumar Timbadia: Range we should be hovering around 3 plus percent in year or two to come. Moderator: Thank you. The next question is from the line of Ankur Gulati, an individual investor. Please go ahead. Ankur Gulati: This is the first time I'm dialing in for the company, if you don't mind, can you just give a quick overview in 3-4 minutes on the products and services?

Chetankumar Timbadia: Ankurji if I may give you an overview, DC Infotech & Communication Limited, we are mainly into networking as a field overall as a domain, 3 domains which are businesses are divided into. One is the traditional networking which we have been doing over 2 decades, networking consisted of for on-prem to cloud solution, wired to wired solution, complete range of products and solutions are on the offering. The second domain which we work is in unified communication where it is digital signage controllers and AV solutions where voice and video is concerned. So that is the second where the convergence of data and audio video comes. That is the second domain which we work in and the third domain which we work is into the enterprise security. When we call enterprise security, we do data security, not the video or CCTV type of security. We are purely a data player where we do cyber security, data security, cloud security, internal network data security and other offerings of this. So if I may say, my business is divided into three major domains which have nuances further down into each category, but this is the thing. We have started our journey with networking. So networking still remains a huge chunk of our business, which is approximately 45%-50% of our business, the unified communication patch also contributes around 25%-30% of our business and the

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enterprise security business, which is the latest addition and as the time goes, it has a more and more demand has risen to approximately 25% of our kitty. Am I able to answer you or?

Ankur Gulati:

Chetankumar Timbadia:

Ankur Gulati:

Chetankumar Timbadia:

Moderator:

Vishal Vardhan:

Chetankumar Timbadia:

So yeah, that's helpful. Really appreciate that. Just a quick question, the margin profile is let’s say is up 5%. So is this more because of they're buying products from third parties and then just installing them? And as you move slightly more towards services, is the margin is expected to improve over the next 2-3 years?

Yes, sir. See, products are not developed by us. We are more of integrator and solution. We are not a manufacturer. So we have aligned ourselves with certain technologies and we have aligned ourselves with certain OEM with the niche technology which they carry. Margins are surely say as earlier our journey started with only trading of products but in last couple of years we have moved from trading of products to our value-added distribution now to more of a solution and the service oriented approach. Surely as more and more services factor kicks in and we get equipped with more and more solutions, margins are on the way up.

Is there some sort of an exclusivity we have with these OEMs where only we can work for them or is it there's no exclusivity with these OEMs when it comes to implementing?

Out of the whole bag which we carry, couple of brands we have exclusivities; couple of brands, we have limited exclusivity; and a couple of brands, there is a regional exclusivity. There are some certain products or solutions, there are some certain skills or certain technology, we have an exclusivity and other products and services, there may not be exclusivity, but the kind of knowledge base, manpower which we are developing, we stand a very favorable position with the OEM to be our preferred partner in terms of the offering whenever they go to the market.

Thank you. The next question is from the line of Vishal Vardhan from KPIT Tech. Please go ahead.

So my question was like, what is the role of DC Infotech products into data centers like can you give a short brief on the services and the product and the value-added service and product that you give to data center? And the second question will be on the cash flow side, like can you comment a bit on the cash flow side and further improvement in it?

So Vishal, thanks, I will take the first portion of the question and the 2nd portion of the question, I would like our CFO Piyush bhai to able to answer that more clearly. The first portion of the question is for the data center. We have great offerings for the data center as such. For data center, basically, if you are aware or as a layman, data center consists of two technology, hardware and software. In hardware, there is one compute side which is lot of servers and storage, bare metal A, C, and etc. We are not into that space. We are into data center is the basic, the networking, the connectivity, the racks, the switches, the cabling portion of it, the routers, the wired that is the portion we service in the data center. So that completely comes

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out of our networking patch what we do. We have offerings of networking switches, cabling, fiber, routers. That is one patch which we offering to data center and the 2nd and the most important thing, every data center now has a connectivity backhaul to a cloud or internet exposure where the lines come in and as we see data center means data. So there is lot of data which is being stored, accessed. So in our enterprise patch, we have solutions for seeing that the data is stored safely and can be retrieved anytime any moment in a safe and secured way to right persons and control it from any external threats of corruption or any ransomware or attacks of any type. So for data center, we have two solutions, one is the hardware in terms of networking and two, the security stack which is needed in a data center to protect its data from all the other sources. So that's the offering which we have for data center, a strong story for data center in terms of DDoS attack, ransomware attack, accessibility attack. We have a couple of offerings which service to this kind of threats available in the market. Am I able to answer you this? So then I will hand it over to Piyush bhai to give your guidance on the cash flow question.

Vishal Vardhan:

Sir, one more thing like can you give me guidance on the growth that you are expecting particularly from data center segment in next three years?

Chetankumar Timbadia:

See, Vishal, data center is the currently booming thing which is needed. With data center, lot of cloud also has come in with Microsoft and Amazons and the Googles playing a lot of cloud into play; one side, the Adanis and the Reliances or Hiranandanis are on the spree of putting the data center, so it's an hybrid of data center and cloud which is going to play out and current tussle is going on there. As the technology evolves, let's see how it plays out, but growth in this patch either way, if it goes this way or that way, we are there in both for the patch, so we should be benefiting from either way the technology takes a curve and this patch inside our is as we started our journey into this enterprise security late 2018-19 sort of, and has been. Now it comes to around 25% of our business and going forward, we see that pie increasing overall in patch because it is one of the fastest growing patch in our business. So yes, overall this patch is going to grow and hopefully it will be one of the predominant patch which will be in our kitty. Piyush bhai, can you help him with the cash flow question which he had?

Piyush Shah: Yeah. Thank you, Chetan bhai. Regarding the cash flow, there will be an improvement in the cash flow because of conversion of warrants by the promoters as well as an improvement in the margins.

Moderator: Thank you. The next question is from the line of Ashok Jain, an individual investor. Please go ahead.

Ashok Jain: So if we see our working capital has increased, our working capital cycle, could you like throw some light on this please?

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Chetankumar Timbadia: Ashokji, you're seeing the increase in working capital cycle, that's true. It comes on as you are comparing it with the previous set of numbers as we have come out of COVID and the post of 2021-22 COVID with the cycles, there was an era of shortage and era of cash and carry mode. So the working cycles were very shorter and deferred the payment cycles were there and now we are back to normal. So the corporates, the customer everywhere now the normal default credit period has kicked in. So that has elongated our working cycle. And secondly, the most important factor out of this is earlier we used to have trade in maybe the deal size with small ticket size. As we are growing the kind of solution and kind of offering, kind of projects which we are taking are bigger ticket size, couple of crores are there and one it is an elaborate solution. It is not a one-off trade or lakh rupee material which we give as solution and we take the money that cycle is much faster. When it is a couple of crores, lot of components, lot of complexity goes into that and when that complete thing is delivered, the payment cycle kicks in. So because of that, there is a stretch on the payment cycle because the execution of a couple of lakhs project will take a faster and couple of crore project will take a much longer time and because of that longer time, the working cycle has increased.

Ashok Jain: Are we, like in the future, planning to raise any funds for our working capital? Chetankumar Timbadia: As in time need, we will be approaching as the business demands as I cannot crystal gaze into the future. But yes, if need be, as the business demands, we are open to raising more funds from bank or maybe via preference or whatever the board feels right, we may raise. Ashok Jain: Fair enough, sir. And sir, could you also share that which are our top three brands in terms of revenue and what is our dependency on them? As a percentage of our revenue basically to understand the dependency? Chetankumar Timbadia: Top three brands in each patch, I would like to segregate it and you see that Samsung is the biggest contributor because its solutions are the offerings which we do. Out of 25%-30% of our business in that Patch, Samsung would be around 15% to 20% contributing out of that. So that answers. In the networking patch, Netgear which we are exclusive distributors for Northeast and West of India contributes around 50% of our patch, 45%-50% in that patch. The third enterprise security, NETSCOUT and Arbor are visibility solutions and DDoS security solutions is 60% of that patch which we offer. Ashok Jain: Understood, sir. And just one last question, what is our current order book? And like how much has it grown like compared to previous year? And like, how do we see it going ahead? Chetankumar Timbadia: So going to the order book question, see our order PO2 execution is a very minimal cycle. So there's nothing more of in other industries, they may have elongated getting the PO and manufacturing something and deliver takes maybe couple of months to couple of years. For us, that is not the case. Our PO2 delivery is within a maximum of a month or so first, but we have a good funnel which we have quoted in cases which we are working on. So we measure

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ourselves on the funnel because once that funnel materialized to our customer peer receiving, our delivery is fast, so answering order book in terms of PO and to be executed will be quite small compared to the funnel which we are carrying is decent. It is approximately around Rs. 40 crores to Rs. 50 crores which we are already quoted, and the order should be coming through maybe in this month or the quarter next, so order book is not very relevant to our business.

Ashok Jain:

And if I could just ask one last question, how do we differentiate ourselves from our competition in this space that like in our entire landscape that we operate in, what is like the competitive edge that we could have?

Chetankumar Timbadia:

The landscape that we operated, I don't see any similar size peer which we have, so that is the very good advantage. We have some peers, but there are something who do similar work are very large like maybe our Tata communication size, size of thing or a Hitachi kind which are a couple of Rs. 1000 crores organization. In the patch we are which a couple of Rs. 100 crores patch are, there is no apple to Apple comparison which we have. So that is the one edge we have. In terms of market presence, with this comparatively smaller size with the elasticity and the flexibility which we bring to the customer in terms of offering services is something which a customer would like to do and good to have. And secondly, what will be our edge in that, we in any domain whatever we did in the product, it is always a value addition. So a simple networking product like a router you can buy it from which we don't deal, but for an example sake I'm just explaining it to you. For example, if you want to buy a router for your home or office, you can go to Amazon and buy one. That's the very simplest way of doing it, but the second what we are able to do, if a person you dial into our sales guy or our office and if you say router, then my guy is trained to help you and guide you to buy, he may ask you what your office size is? What is your requirement? How people are going to log in? What is the speed you are looking? What is the Internet size you are looking and then give you a final solution that this is something which is recommended to you and to top it up there are guys who can help you to install and support it. So the complete cycle from a buying guidance to support in terms of installation and later the support which we have a unique way in across the categories whatever we are servicing, all brands, all technology we have the sales team who is technically qualified to guide you and the support and service team to back it up. So this is something which is very unique as proposition to our customers. And this helps to keep edge ahead than the rest of the peers in any domain which we work in.

Moderator: Thank you. The next question is from the line of Manoj Rajani from Rajani Family Office. Please go ahead.

Manoj Rajani:

So basically sir wanted to understand that during our last concall, you had mentioned that the goal of reaching Rs. 1000 crores in revenue within the next couple of years. So just wanted to understand like how close are we to achieving this target right as of now? And what are the primary drivers behind this growth?

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Chetankumar Timbadia: Manoj ji, glad to have you back. And you remember what I had spoken, so I would love somebody like you following up on this. So to answer your question, the Rs. 1000 crore mark still stays on the horizon. And if you say how close, we are halfway there. And I hope in next couple of years we should be there, we have a plan in place to see and let's see how fast we are able to execute it in a more profitable way. But yes, the Rs. 1000 crore plan stays on the horizon and we are firmly committed to reach it. The time duration may be little here and there, but that is on the horizon.

Manoj Rajani: So by FY26 or the two quarters more, we should be able to achieve it? Chetankumar Timbadia: FY26 would be my dream target, but our endeavor is there. We are in that endeavor to go towards that direction. I would not be able to commit to you on FY26, but yeah, my heart would like to do that in that direction. But maybe one or two financials here and there, we will be there.

Manoj Rajani: Certainly. And so, sir, you had emphasized that interactive panels are poised to become a significant growth opportunity as well particularly in the second-half of this year. So could you quantify the revenue potential that we see from that particular segment? And I mean, additionally, could you also provide some insight if we have been in any customer discussions or the order pipeline that it currently holds? Chetankumar Timbadia: This is what I had updated you in the last earnings call. Interactive panel is here and in a big way. We have done a couple of 100 units for one of the state government in the last financial year, but as you know last 6 months, government was in a shutdown mode of not investing any more, which hopefully yesterday everything has been recently cleared. So interactive panel coming in this year is going to be a very big driver from the government side because the education is one of the big field where our government is investing and it has to, so that we should be seeing good traction. As far as interactive panel on the enterprise side or the corporate side, the adoption is going in a very decent way, more and more organization are using it for their boardrooms, meeting room, huddle rooms and a lot of other methods are being used. So yeah, we see that contributing to a decent maybe Rs. 30 to Rs. 50 crores this year interactive panel into our kitty.

Manoj Rajani: And what was it in the last year, FY24?

Chetankumar Timbadia: FY24, I would say it was one decent big order, this is very offhand, but I would give you a range between Rs. 8 to Rs. 12 crores.

Moderator: Thank you. The next question is from the line of Ashna Joshi, an individual investor. Please go ahead.

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Ashna Joshi:

Chetankumar Timbadia:

Ashna Joshi:

Chetankumar Timbadia:

Ashna Joshi:

Chetankumar Timbadia:

I just wanted to understand in terms of our competition that is Creative and Reddington. So how do we differentiate ourselves from our competitors and that's something that I wanted to understand?

So from our competitors, you mentioned Creative Newtech and Reddington India Limited. So, ma'am, we are not, if you see, maybe size wise we are nearly there or little smaller than Creative and Reddington, we are a very small compared to them. Creative, we are not into that same domain ma'am. Creative is more into product selling, it is more of an offline version of an Amazon which is doing with the couple of technologies and brands which they are carrying. They do the distribution across the nation. Their strength is distribution while our strength not lies in distribution, our strength lies in solutions and services and the products we carry. They don't do that. So that's the differentiator. They are good at moving the material to the various location, reaching out to the last single user customer. We are more of a corporate or a B2B type of business. So that's the differentiator with Creative and Reddington again is a mega version of Creative. Reddington lies in strength of its network across the nation, across the globe. With the financial strength and the muscle they have, they do lot of mobility in terms of Apple and Samsung, which out of that 40,000-50,000 must be contributing 20,000-30,000 of that turnover and lot of other IT brands also. So large brands who want to just reach out to the books and corner of this nation would use that Reddington route with the type of network and the financial strength are there. So we are not in direct competition or a peer sort of that, but yes, you would see that if you are able to see what Reddington has been doing or trying to achieve in last couple of years, they were trying to build some solution and services factor to what they are doing and trying to add because this is the way forward which they have also realized and we are rightly in that patch, we are already there doing that in that patch. Size wise not comparable, but yes what we are doing Reddington is trying to do it. Will they be able to do it with their size, it's a big question ma’am because an elephant takes time to turn and maybe but we are not happy as I would not like to, in terms of technology size wise, yes, maybe you can have a look at it.

So in terms of technology, who do we consider as our like-to-like player?

Ma'am, much nothing much in the listed space which we have since as you must have heard already, I had explained it to earlier gentleman. We are working into three domains, so there is no apple-to-apple company which is available exactly in these domains. There are non-listed private limited players who have either one or two domain in their kitty and we compete with them, but nothing in the listed space ma’am.

Sir, just wanted to understand our revenue mix in terms of our customers. So who will be like our top five contributing customers and what kind of revenue do they contribute?

Top five customers if I go by the last year since in the security patch, we do lot of high-end solutions and this high-end solutions go to large organizations, I would call it Nifty 50 type of

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organizations, the banks, the financial institution. Since we have borne out of this and that is our strength, the NSEs, the BSEs and this kind of patch is only they have their consultancy in place like a Deloitte or KPMG or TCL or NTT or a Hitachi type of. So what happens is the complete solution or the take away is given to one of them and the security patches then carved out and handed over to us because only they don't have that expertise to execute it and deliver it. Then we come into play and out of the whole project that offloaded portion of security is being done, supplied, installed and serviced back-end firm that whole patch which this kind of working apples are minimal like infra, road, etc., everything. So here if you see my top five customer, that TCL was one of our biggest customer, Tata Communication Limited was one of the biggest customer in the last previous year. Hitachi was one of our biggest customer in last previous year in the security patch. And in the product patch or the networking patch which we do, there, we have one of the partners out of Delhi who does a good business for us. And for the UC patch, we have done some decent size orders last year, which were mainly for museums across the nation, and Sansad Bhavan and so with the partner who has picked up for new Sansad Bhavan and the museum, we have done quite a bit work for them, so if you have the privilege to visit Sansad Bhavan, you see a lot of LEDs around there and that work has been done by us.

Ashna Joshi:

So what kind of revenues would they be contributing? Will you be able to bifurcate that like how much percentage of the revenue does it contribute these top customers?

Chetankumar Timbadia:

I will not be able to give you top five, but our top 15 of them will be contributing around 40%50% of our business.

Ashna Joshi: Top 15, you said?

Chetankumar Timbadia: Yeah, top 15.

Moderator: Thank you. The next question is from the line of Harshal Patel, an individual investor. Please go ahead.

Harshal Patel:

I have a few questions. So do we have a plan to raise the funds for our working capital?

Chetankumar Timbadia:

Harshal, I think I had answered it earlier. For your reference, yes, as of now we have funded but going forward as business demand needs, we are open to raise more as our business needs because we are committed to the kind of growth which we have already given as the guidance. And obviously, without funds, nothing would happen. So we as a board as are open whenever the need arises, we will raise to fuel the growth.

Harshal Patel:

And what percentage of our revenue and margins are derived from the hardware and the software segment from FY24?

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Chetankumar Timbadia: FY24, hardware is 80%, 20% comes from the software services.

Harshal Patel: And could you provide a current breakdown of our revenue for our business segment? What are the margins for this segment? Chetankumar Timbadia: So business segment, we are working to three domains; Networking, UC and Enterprise Security. The networking patches are approximately 45% of our business. The UC business comes around 25%-30% and 25% comes from the enterprise security patch. The margins in the networking patch, what we call it, is around hovering around 5% to 7%. In the UC patch, it is approximately 7% to 8% or 9% and in the security patch, it is double digit. Harshal Patel: And what is our important key drivers for revenue and EBITDA margins? Are we planning to work on the new areas of development in our businesses? So do we have any update on expanding our businesses in overseas market as you had mentioned potential plans for the expanding outside India, so can you share more details on any progress made in international markets and how this aligns with the company overall growth strategy? Chetankumar Timbadia: The expansion plan is very much on the board. This year, we have just moved to the southern India, which we are not present. So we just set up our operations in Southern India, the team is in place. So this year will be the focus in Southern India. Overseas market, we are studying it and once the time is right, you should be hearing from us on that also. Moderator: Thank you. The next question is from the line of Arka Bhattacharya, an individual investor. Please go ahead. Arka Bhattacharya: Sorry for the follow-up question, which has already been answered and I just would like to know what the breakup in terms of software and hardware is? In your last concall you have given the breakup. What is the breakup for the software and hardware in FY24? Chetankumar Timbadia: This is the same thing which I told, 80% is products and 20% is software. Arka Bhattacharya: And another one question will be sir, the number of employees, how many employees are working for you? Is everyone into sales or do you have people in development as well? Chetankumar Timbadia: We are approximately 70 plus team and it is mixture of everything. It is not only sales, sales support guys, the engineer, the technician and obviously the finance and the admin team. They all put together, we are 70 plus. Arka Bhattacharya: Ok. In the last con call also you had mentioned that you have very specially skilled set of people and the orders that you are getting, I wanted to know the kind of skilled people that you have in your development team as well? Do you have any developers who are working on this?

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Chetankumar Timbadia: So we don't do in-house development, we deploy solutions and products, there is no actual software development for other. We are installers and service providers for that. If I give an example, SAP. SAP, we don't do SAP but as an example I'm just SAP is a software, but there are installers and partners who will customize the SAP for you and install and support you. Similarly, we have some technologies which is a modular security products. According to the customer requirement, we will suggest you that modules which will require will help you to install it and then support you and configure it and support you on that software. So there's nothing like development, development, coding type in our business. It is more of configuring the existing product. Arka Bhattacharya : So you have mostly people from networking and IT specialist and that kind of…? Chetankumar Timbadia: Yeah. Moderator: Thank you. The next question is from the line of Aakash Sharma, an individual investor. Please go ahead. Aakash Sharma: My questions are on financials. Sir, can you tell me that like what are factors contributed for the growth in revenue? Chetankumar Timbadia: What factors contributed? Everything, all the domains contributed, and everything was going. Akash bhai, if you are able to rephrase your question it would be helpful what has contributed. There's nothing specific. One thing which has contributed, all the products and technologies have grown. Maybe some percentage here and there but everything has grown in our kitty. Aakash Sharma: Like the sales, if the sales has grown or any new regions has been expanded? Chetankumar Timbadia: The sales have grown, region expansion is for this year. As I mentioned to the earlier gentleman, Southern India is something which we are going to tap this year. Moderator: Thank you. The next question is from the line of Vishal Vardhan from KPIT Tech. Please go ahead. Vishal Vardhan: Sir, like I can see that the security software and the services segment for this particular quarter had a very good growth of like Rs. 40 crores compared to like other quarter where it used to be between Rs. 10 to Rs. 20 crores range. So was there any particular reason for this growth in security services and software and will we have this growth continued for next year like every quarter something similar in this range? Chetankumar Timbadia: Vishal, I would love to be there in that. But some orders which were supposed to be executed in OND because of that Diwali patch, they got pushed into the JFM quarter and because of that JFM quarter, you see a big spike. This kind of numbers would may not be the same, but our

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endeavor is towards that direction and we are working on a couple of good funnel and hopefully we will be able to manage around that size of numbers this year also every quarter.

Moderator:

Chetankumar Timbadia:

Moderator:

Thank you. Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to Mr. Chetankumar Timbadia from DC Infotech & Communication Limited for closing comments. Over to you, sir.

I would like to thank the entire team of DC Infotech & Communication Limited for their continuous effort, hard work and dedication, which strengthens the company’s resistance to the various market cycles. Also, I appreciate all of you for participating in this conference call. Please do get in touch with our Investor Relation team if you have any further follow-up questions for this. Thank you. Thank you everyone for joining. Thank you, Michelle. Thank you, Rupesh for arranging this.

Thank you members of the management. Ladies and gentlemen, on behalf of DC Infotech & Communication Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you. Thank you, sir.

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