Quick Heal Technologies Limited — Interim / Quarterly Report 2019

Nov 12, 2018

Quick Heal Quick Heal Technologies Ltd.

Security Simplified (Formerly Known as Quick Heal Technologies Pvt. Ltd.) Regd. Office:Marvel Edge, Office No.7010 ( & D, 7th Floor,Viman Nagar,Pune 411014, Tel.:+91 206681 3232 Email: info@quickheal.com (IN - L72200MH1995PL(091408

Ref No.: QHTLjSecjSEj2018-19j44 12thNovember, 2018

The Manager, Corporate Services, BSELimited, 14th floor, P J Towers, Dalal Street, Mumbai - 400001 Ref:Security ID : QUICKHEAL Security Code: 539678

The Manager, Corporate Services, National Stock Exchange of India Limited, Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai - 400051 Symbol: QUICKHEAL Series : EQ

Subject: Outcome of Board Meeting 12thNovember, 2018

Dear Sir j Madam,

We wish to inform you that the Board of Directors at its meeting held on 12th November, 2018 which commenced at 03:00 PM and concluded at 7:52 PM, has approved following:

• 1. Unaudited Standalone Financial Results of the Company for the quarter and half year ended 30thSeptember, 2018.
• 1. A copy of the Press Release being issued in respect of aforesaid financial results.
• 1. Result Presentation in respect of aforesaid financial results.
• 1. Pursuant to Regulation 33 of SEBI Regulations, we have enclosed herewith Limited Review Report for the Unaudited Standalone Financial Results of the Company for the quarter and half year ended 30thSeptember, 2018, from our Statutory Auditors, Mjs S R B C& COLLP,Chartered Accountants.

This is for your information and records.

For Quick Heal Technologies Limited

~ Raghav Mulay Company Secretary Encl: As Above

QUICKHEALTECHNOLOGIESEdge, Office No. 7010 C & 0,Regd. Office: Marvel7th floor,Opposite	LIMITEDNeco GardenSociety,VimanNagar,	Pune - 411014
CIN: L72200MH1995PLC091408
STATEMENTOF STANDALONE ASSETS AND LIABILITIES	AS AT SEPTEMBER30, 2018
	As atSeptember 30, 2018	As atMarch 31, 2018
Assets	(Unaudited)	(Audited)
Non-currentassets
(a) Property, plant and equipment	1,651.20	1,610.96
(b) Capital work-in-progress		138.72
(c) Intangible assets	-101.93	118.31
(d) Investments in subsidiaries	147.16	184.50
(e) Financial assets
(i) Investments	194.80	175.75
(ii) Loans and security deposits	3.81	3.18
(iii) Other financial assets	3.97	2.92
(I) Deferred tax assets (net)	77.51	43.70
(g) Income tax assets (net)	26.74	33.90
(h) Other non-current assets	0.13	0.14
	2,207.25	2,312.08
Current assets
(a) Inventories	47.01	47.15
(b) Financial assets
(i) Investments	3,123.02	2,889.04
(ii) Trade receivables	1,168.79	1,027.41
(iii) Cash and cash equivalents	114.94	83.47
(iv) Bank balances other than (iii) above	1,478.48	1,507.24
(v) Loans and security deposits	8.26	8.13
(vi) Interest accrued	37.54	39.00
(c) Other current assets	41.14	23.59
	6,019.18	5,625.03
Total assets	8226.43	7937.11
Equity and liabilities
Equity
(a) Equity share capital	704.89	703.88
(b) Share application money pending allotment	0.29	-
(c) Other equity	6,829.49	6,667.44
Total equity	7,534.67	7,371.32
Llabllities
Non-currentliabilities
(a) Net employee defined benefit liabilities	14.64	21.04
(b) Other non-current liabilities	19.33	-
	33.97	21.04
Current liabilities
(a) Financial liabilities
(i) Trade payables
(a) Total outstanding dues of micro enterprises and small enterprises	-	-
(b) Total outstanding dues creditors other than micro enterprises and enterprises	392.64	322.72
(ii) Other financial liabilities	20.05	15.61
(b) Other current liabilities	162.08	131.24
(c) Net employee defined benefit liabilities	16.11	13.10
(d) Income tax liabilities (net)	66.91	62.08
	657.79	544.75
Total liabilities	691.76	565.79

Total equity and liabilities 8,226.43 7,937.11

QUICK HEAL TECHNOLOGIES LIMITED

Regd. Office: Marvel Edge, Office No. 7010 C & D, 7th Floor, Opposite Necc Garden Society, Viman Nagar, Pune> 411014 CIN: L722ooMH1995PLC091408

STATEMENT OF FINANCIAL RESULTS FOR TilE QUARTER AND SIX MONTIlS ENDED SEPTEMBER 30, 2018

							(lNR In million)
		Standalone
			uarter ended		Six month ended		Year ended
Sr.No.	Particulars	September 30, 2018(Unaudited)	June 30, 2018(Unaudited)	September 30,2017(Unaudited)	September 30,2018(Unaudited)	September 30, 2017(Unaudited)	March 31, 2018(Audited)
	I Income
	Revenue from operations	1,088.56	527.88	1,045.32	1,616.44	1,342.54	3,162.22
	Other income	86.35	63.75	56.94	150.10	111.57	298.75
	Total Income	1174.91	591.63	1102.26	1766.54	1 454.11	3460.97
	2 Expenses	10.31	1.80	1.59	12.11
	Cost of raw materials consumed	41.42	19.22			3.99	10.55
	Purchase of security software products			17.22	60.64	24.75	93.96
	Increase I (decrease) in inventories of security software products	(5.36)	(2.94)	22.64	(8.30)	22.41	22.02
	Employee benefits expense	243.51	250.87	256.93	494.38	512.65	996.76
	Depreciation and amortisation expense	60.12	59.14	67.63	119.26	131.73	268.82
	Other expenses	195.90	166.20	144.02	362.10	333.72	801.62
	Total expenses	545.90	494.29	510.03	1,040.19	1,029.25	2,193.73
	3 Profit I (1055) before exceptional Items and tax (1-2)	629.01	97.34	592.23	726.35	424.86	1,267.24
	4 Exceptional items (refer note 4)	50.00			50.00		75.09
	5 Profit I (loss) before tax (3-4)	579.01	97.34	592.23	676.35	424.86	1,192.15
	6 Tax expenseCurrent tax
	Pertaining to profit for the current period	191.27	29.69	179.11	220.96	127.11	363.68
	Adjustments of tax relating to earlier periods (Net)	14.71	-		14.71		-
	Deferred lax	(4.01	3.24	20.40	(0.77	15.88	39.69
	Total tax expense	201.97	32.93	199.51	234.90	142.99	403.37
	7 Profit I (loss) for the period (5-6)	377.04	64.41	392.72	441.45	281.87	788.78
	8 Other comprehensive income, net of taxOther comprehensive income not to be reclassified to profit or loss in subsequent periods:
	Re-measurcment of defined benefit plans	1.36	(4.69)	2.55	(3.33)	0.13	7.35
	Net (loss) or gain on FVTOC1 assets (refer note 4)	(29.52)			(29.52)	-	(37.13)
	Total other comprehensive Income	(28.16)	(4.69)	2.55	(32.85)	0.13	(29.78)
	9 Total comprehensive income (after tax) (7+8)	348.88	59.72	395.27	408.60	282.00	759.00
	10 Paid-up equity share capital (face value ofINR 10 each)	704.89	704.70	701.89	704.89	701.89	703.88
	11 Other equity (as per balance sheet of previous accounting year)						6,667.44
	12 Earnings per share of INR 10 each:(not annualiscd except for the year ended March)
	a) Basic	5.35	0.91	5.60	6.26	4.02	11.23
	b) Diluted	5.34	0.91	5.58	6.25	4.00	11.20

	Regd. Office: Marvel Edge, Office No. 7010 C & D, 7th· Floor, Opposite Neco Garden Society, Virnan Nagar, Pune - 411014	QUICK HEAL TECHNOLOGIES LIMITED
:		CIN: L7Z200MH1995PLC091408
	STATEMENT OF FINANCIAL RESULTS FOR THE OUARTER AND SIX MONTHS ENDED SEPTEMBER 30 2018
Notes to financial results
1 The above financia1s results for the quarter and six month ended September 30,2018 have been subjected to limited review by the statutory auditors of the Company and reviewed by the Audit Committee and approved by the Board ofDircctors of the Company at the meetings heldon November 12,2018.
2 During the earlier periods, the Company had received statements of demands of service tax under the provisions of Finance Act, 1994 for lNR 1,223.07 million (excluding penalty of lNR 626.97 million and pre-deposit ifany) covering the period from March 01, 201 1 to March 3 I,2016 on supply of anti-virus software in Compact Disk, The Company had filed an appeal with Customs, Excise and Service Tax Appellate Tribunal, New Delhi for the period March 01,2011 to March 31,2014 and with the Customs, Excise and Service Tax Appellate Tribunal,Mumbai for the period April 01, 2014 to March 31, 2016. Based on technical circular issued by the government authorities and an independent legal opinion, the Company is confident of getting this claim set aside and accordingly no provision has been considered necessaryin thisregard and also for the subsequent period till June 30, 2017 (before implementation orGST).
In addition to above, during the earlier period, the Company had received letter for submission of the sales information pertaining to period April 01, 2016 to March 31, 2017 and from April 01,2017 to June 30, 2017 respectively. Accordingly, the Company had submitted therequired information during the earlier periods.
3 Effective April I, 2018, the Company has adopted Ind AS 115 revenue from contracts with customers under the modified retrospective approach without adjustment of comparatives. The standards is applied to contracts that remains in force as at April 01, 2018. The application 0the standards did not have any significant impact on the retain earnings as at April 0 I, 2018 and financial results for the current quarter and six month ended.
4 Impairmentof investments
Included in exceptional items
Particulars			Ouarter ended		Six month ended		Year ended
		September 30, 2018(Unaudited)	June 30, 2018(Unaudited)	September 30, 2017(Unaudited)	September 30,2018(Unaudited)	September 30,2017(Unaudited)	March 31, 2018(Audited)
Impairment of investment in wholly owned subsidiaries		50.00			50.00		75.09
Further, the decline in fare value of investment ofINR 29.52 million (March 31, 20t8; lNR 37.13 million) has been included in Other Comprehensive income.
S The Company is engaged in providing security software solutions. The Chief Operating Decision Maker (CO OM) reviews the information pertaining to revenue of each of the target customer group (segments) viz. retail, enterprise & government and mobile. However, based onsimilarity of activities/products,108 "Operating segments".	risk and reward structure, organisation structure and internal reporting systems, the Company has structured its operations into one operating segment viz. anti-virus and as such there is no separate reportable operating segment as defined by Ind AS
6 Post implementation of Goods and Services Tax (GST) w.c.f July 1,2017, "Rcvenue from operations" has been disclosed net ofGST.					---:-:--,
				;'"-	-:(;~I
				,.>			For and on behalf oftbe Board ef Directon
				-7-/I,Cr
				II"	\'~~\
Place: Pune				I	InljIf		L1KaiJash KatkarManaging Director

QUICK HEAL TECHNOLOGIES LIMITED , Regd, Office: Marvel Edge, Office No. 7010 C & D, 7th Floor, Opposite Neco Garden Society, Virnan Nagar, Pune - 411014

CIN: L72200MHl995PLC091408

ABRIDGED STATEMENT OF FINANCIAL RESULTS

(INR in million)

		Standalone
			Quarter ended		Six month ended		Yearendcd
Sr. No.	Particulars	September 30, 2018	June 30, 2018	September 30,2017	September 30, 2018	September 30, 2017	Marcb 31, 2018
		(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Audited)
		(Refer note 2)		(Refer note 2)
I	Total income from operations (net)	1,088.56	527.88	1,045.32	1,616.44	1,342.54	3,162.22
2	Net profit/(Ioss) for the period before tax (before exceptional items)	629.01	97.34	592.23	726.35	424.86	1,267.24
3	Net profit/(loss) for the period before tax (after exceptional items)	579.01	97.34	592.23	676.35	424.86	1,192.15
4	Net profit/(Ioss) for the period after tax (after exceptional items)	377.04	64.41	392.72	441.45	281.87	788.78
5	Total Comprehensive Income for the period [comprising profit/(Ioss) for the period (after tax) and other comprebensive	348.88	59.72	395.27	408.60	282.00	759.00
	income (after tax)1
6	Reserves (excluding Revaluation Reserve as shown in the Balance Sheet of previous year)						6,667.44
7	Equity share capital (Face value on' 10 each)	704.89	704.70	701.89	704.89	701.89	703.88
8	Earnings per share (before and after extraordinary items)
	(of<1O each)· not annualised
	Basic:	5.35	0.91	5.60	6.26	4.02	11.23
	Diluted:	5.34	0.91	5.58	6.25	4.00	11.20

Notes:

I The above is an extract of the detailed format of Half year and Quarter Financial Results filed with the Stock Exchange under Regulation 33 of the Securities and Exchange Board ofindia ('SEBI') (Listing obligations and Disclosure Requirements ('LODR') Regulations, 2015. The full format of the audited standalone financial results of the Company are available on the Stock Exchange's website (www.bseindia.com and www.nscindia.com) and also on the Company's website - www.guickheaLco.in.

2 The above financials results for the quarter and six month ended September 30, 2018 have been subjected to limited review by the statutory auditors of the Company and reviewed by the Audit Committee and approved by the Board of Directors of the Company at the meetings held on November 12,2018.

Date: November 12,2018 ,

, - ft~ / , For and on bebalf of the Board of Directors SdI· I, , Kailasb Katkar Place: Pune I Managing Director I & Chief Executive Officer

.'

/4. Ii /'

FOR IMMEDIATE RELEASE

Quick Heal Technologies Limited reports 20% increase in revenue during H1 FY19

• Revenue grew YoY by 20% to Rs. 1,622 million
• EBITDA grew YoY by 58% to Rs. 686 million with a Margin of 42%
• PAT grew YoY by 77% to Rs. 482 million with an improvement in Margin to 30%

PUNE, November 12, 2018: Quick Heal Technologies Limited ("Quick Heal"), India's leading IT Security Software Products and Solutions provider, reported its reviewed and un-audited results for the quarter and half year ending 30th September 2018.

Consolidated Financial Highlights:

Particulars (Rs. million)	H1 FY19	H1 FY18	YoYChange
Revenue	1,622.20	1,353.79	19.83%
EBITDA	685.71	434.27	57.90%
EBITDA Margin	42.27%	32.08%	+1,019 bps
PAT	482.14	271.74	77.43%
PAT Margin	29.72%	20.07%	+965 bps

Segmental Performance for the half year ended 30th September 2018

• Retail segment revenue up 20% to Rs. 1,379 million as compared to Rs.1,154 million in the corresponding period of the previous year
  • Contributes 80% to Total Revenue
• Enterprise and Government segment revenue up 8% to Rs. 335 million as compared to Rs. 309 million in the corresponding period previous year
  • Contributes 20% to Total Revenue

Mr. Kailash Katkar, Managing Director & Chief Executive Officer, Quick Heal Technologies Limited, said; "There has been a steady momentum in the business which is visible from our H1FY19 performance. We have been actively engaging with the channel ecosystem, which has resulted in a better performance in Retail as well as Enterprise & Government segment. The Retail segment has grown by 20% on YoY basis whereas the Enterprise segment has grown by 8% on YoY basis. We continue to remain focused on the growth of both retail and enterprise segments and are confident of continuing on the growth path in the coming quarters."

Mr. Nitin Kulkarni, Chief Financial Officer, Quick Heal Technologies Limited, added "We have been actively working on various strategies to fuel growth in the business and at the same time also maintain strict cost controls. The strategy has paid off in H1 FY19, wherein we have witnessed 20% growth in revenues and increase in EBITDA and PAT margins by 1,019 bps and 965 bps respectively."

Mr. Vijay Mhaskar, Chief Operating Officer, Quick Heal Technologies Limited, commented "The cyber threat landscape has been presenting new challenges every day and to ensure security of the digital world, we have been regularly enhancing the features of our existing products as well as launching new products to counter the threat landscape. The launch of Secure Web Gateway is a testimony to our commitment and ability to create customised solutions for the diversified needs of our customers. We are constantly working towards faster growth in Enterprise & Government segment and are confident of replicating our success of retail business on the Enterprise side as well."

Awards and Accreditations:-

Seqrite Endpoint Security certified as 'Approved Corporate Endpoint Protection for Windows' by 'AV-Test'

About Quick Heal Technologies Limited

Quick Heal Technologies Limited is one of the leading providers of IT security software products and solutions in India. Incorporated in 1995 with a registered office in Pune, Quick Heal has a network of over 23,500+ channel partners as on 30th September 2018. It conducts sales and marketing activities across India.

Quick Heal's portfolio includes solutions under the widely recognized brand names 'Quick Heal' and 'Seqrite' across various operating systems and devices.

For more information about the Company, please visit our website www.quickheal.co.in

Safe Harbor Statement

This document may contain forward-looking statements about Quick Heal Technologies Limited, which are based on the beliefs, opinions, and expectations of the company's management as the date of this press release and the companies do not assume any obligation to update their forward-looking statements if those beliefs, opinions, expectations, or other circumstances should change. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. Consequently, readers should not place any undue reliance on such forward-looking statements.

For further details please contact

Company	InvestorRelationsAdvisors
QuickHealTechnologiesLimited	StrategicGrowthAdvisorsPvt.Ltd.
CINNo:L72200MH1995PLC091408	CINNo:U74140MH2010PTC204285
Mr.AkashGosavi	Mr.JigarKavaiya/Mr.RahulAgarwal
EmailId:akash.gosavi@quickheal.co.in	EmailId:jigar.kavaiya@sgapl.net
Tel.No.:+9102066813287	rahul.agarwal@sgapl.net
	TelNo:+917738359389/+917977090416

Safe Harbor

This presentation and the accompanying slides (the "Presentation"), which have been prepared by Quick Heal Technologies Ltd. (the "Company"), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

This presentation contains certain forward looking statements concerning the Company's future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The Company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the Company.

Value Proposition

20+ Years of Quick Heal Technologies…

…with a Vision & Mission

Vision

To be the trusted Global Leader in securing the Digital World

Mission

• Secure our Customers by providing Innovative, most preferred and valued Security Solutions, Services and Knowledge.
• Protect information and interactions on all types of networks, devices & things globally.
• Build a healthy business and organization.

Enhance and Innovate Computer and Network Security Solutions through Strong Customer-focused Approach

...supported by Skilled Professionals

Sales and Marketing Team

311 members

Working closely with our customers and Channel Partners to identify new sales prospects, sell solutions and provide after-sales support.

Research & Development Team

360 members

Working on identifying new threats and devising innovative solutions and features across retail, enterprise and mobile segments with more than 2 decades of experience

Technical Support Team

206 members

Provide efficient multilingual and instant technical support, after sales service and effective guidance to domestic and overseas customers

Product Management Team Ensures that we build the Right Products for the Right Markets at the Right Time

Internet of Things (IoT) Security Team

Creating solutions to ensure all your connected devices are secure

R&D Team Members

R&D Spend as % of Sales

Product Development Team Designing & building cutting edge products & solutions

Incidence Response Team

Ensures customers are unaffected by critical attacks/outages by responding promptly

Quality Assurance Team

Relentlessly maintaining and creating industry benchmarks for quality

Security Labs

Detect and analyze threat vectors across the globe and provide advanced protection to customers

…striving for excellence in customer service

…Sales & Distribution to increase Market Share

Established a robust & diversified network and a dynamic ecosystem of Channel Partners in cities & towns across India to reach our end-customers

330 Enterprise Partners

Strong Internal Sales & Marketing Team of 311 Employees

work closely with Customers and Channel Partners to identify new sales prospects, sell solutions and provide after-sales support

70 Government Partners

Disclaimer: Maps not to scale. All data, information, and maps are provided "as is" without warranty or any representation of accuracy, timeliness or completeness

…guided by Experienced Board of Directors

Drives the strategic direction for the company while nurturing a strong leadership team to drive it's execution

Dr. KAILASH KATKAR MD & CEO

Mr. SANJAY KATKAR Joint MD & CTO

Spearheads the creation and subsequent development of the core product technology

Ex-IAS officer and served in senior positions at the State Government and Central Government

Mr. PRADEEP BHIDE Independent director

Independent Director Mr. MANU PARPIA Independent Director

Serves as the MD at Sequoia Capital India. Previously, he worked at Redknee's India subsidiary as the Managing Director

Mr. SHAILESH LAKHANI Non Executive Director

Mr. MEHUL SAVLA Independent Director

Serves as Director for RippleWave Equity Advisors LLP. Previously worked at JP Morgan, ICICI Securities and SEBI

Dr. APURVA JOSHI Independent director

Has 24 years of diverse experience in building and delivering a range of IT services for customers located across five continents

Certified bank forensic accounting professional and anti – money

laundering expert

Founded Geometric Limited and has 35+ years of experience in the PLM and Engineering arena

11

… and Strong Leadership Team

Dr. Kailash Katkar | Managing Director & CEO

• Has been a driving force in growing Quick Heal Technologies since it's inception • A proven leader with a profound proficiency in developing strong client relationships, passion for building outstanding teams and a disciplined focus on operations & execution of strategy

Mr. Sanjay Katkar | Joint Managing Director & CTO

• Co-founder of the company
• Leads the global technology strategy & is responsible for the core research & development of the products
• Has served as the Director of Association of Anti-Virus Researchers, Asia and is a distinguished speaker at various industry forums
• Holds Master's degree in Computer Science from University of Pune

Mr. Vijay Mhaskar | COO

• Responsible for formulating & driving the overall business strategy and operations across all business verticals
• 20+ years of experience in accelerating engineering processes & leading several successful products at Avaya, Symantec, Saba Inc., Clarice Technologies
• A Gold Medalist in Electrical Engineering & holds a Masters degree in Technology from IIT, Mumbai

Mr. Nitin Kulkarni | CFO

• 25+ years of experience in managing different aspects of finance function in IT and Manufacturing Industry
• Previously held leadership positions at Tech Mahindra, KPIT, Atlas Copco India and Persistent Systems
• A member of the Institute of Chartered Accountants of India

Mr. Nagesh Ayyagari | Vice President – Engineering, R&D

• Seasoned technology professional with a reputation for building and inspiring high-performance teams that delivered inline with company
• 20+ years of experience in leadership positions at Mphasis Software, McAfee, and Oracle
• Has management degrees from IIM, Bangalore and ESADE Business School & has done project management from UCB

Mr. Deepak Mishra | Head, Retail Sales

• Responsible for enhancing market share and driving channel strategy for the retail brand
• 19+ years of experience in FMCG, Beverages, Telecom and IT Industries
• Has extensive exposure in Sales and Distribution, channel management, and building a robust distribution to drive productivity and profitability

Mr. Jyotish Werulkar | Head, Enterprise Sales

• Responsible for leading and driving the enterprise channel strategy & for building and managing the entire enterprise sales vertical in India
• 14+ years of experience in sales and business development at IBM, Acer India, AMD India
• Holds an MBA from University of Pune

Mr. Gurudutt Jakhmola | Head, Government Sales

• A veteran Business Development professional with 16+ years of work experience in Government, Enterprise & SMB segment
• His core competencies include OEM Strategic Alliances, national/regional distribution and local Re-seller Network
• 18+ years of experience at firms such as Hutch, HP, and Reliance Broadcast Network Ltd

…giving Competitive edge Globally

Quick Heal Global Offices

International Partner Locations

Benin	Bangladesh	Austria
Ghana	Japan	France
Gambia	Cambodia	Italy
Kenya	Korea	Netherlands
Malawi	Sri Lanka	Poland
Togo	Myanmar	Australia
Uganda	Malaysia	United Arab Emirates
South Africa	Nepal	Iran
Zambia	Philippines	United States
Zimbabwe	Vietnam	Venezuela

Disclaimer: Maps not to scale. All data, information, and maps are provided "as is" without warranty or any representation of accuracy, timeliness or completeness

…certified by Global Agencies

International Certifications &

ISO Certifications

Our products help secure the networks used by millions of customers. Some of the industries we cater to:

…creating Specialized workforce at Quick Heal Academy

Academy Partners:

Savitribai Phule Pune University

• Designed an 'M-Tech in Information Technology Program' for Savitribai Phule Pune University

MIT-ADT University

• Conducted a training programme on Cyber Crime Investigation for BE graduates

Maharashtra Cosmopolitan Education Society

• The society runs 30 institutes from its ultra modern campaigns located in Maharashtra

Chitkara University

• MoU with Chitkara University
• Introduced an additional stream in Cyber Security for the 4-year Undergraduate program

Quantum Global Campus

• MoU with Quantum Global Campus for a joint B. Tech programme

Gujarat Forensic Sciences University

• MoU with Gujarat Forensic Sciences University during Vibrant Gujarat 2017

• Trained faculty members of a renowned
• SOC Training @Pune (100% freshers placed)
• Started a "45 day Industrial Training"
• Conducting cyber awareness training for a

…Awards & Accreditations as testimony to Delivery

• Best Make in India Brand, 14th VARINDIA IT Forum
• 12th Annual Info Security PG's 2016 Global Excellence Awards, USA
• Best Antivirus, 9th NCN Most Innovative Product of the Year Award
• Top Trademark Driven Industry (Small & Medium Enterprise) by CII Industrial Intellectual Property Awards

• Quick Heal Total Security receives BEST+++ certification from AVLab
• Seqrite Endpoint Security: Best Overall Speed 2017: Silver Award for the Performance Test
• Seqrite Endpoint Security is Approved Corporate Endpoint Protection for Windows by AV-Test
• Approved Windows Security Product for year 2017 by AV-Comparatives
• Seqrite Endpoint Security is ICSAlabs certified product for year 2017

• Seqrite received Best Enterprise IT Security Brand award at 11th NCN innovative product award 2018
• Quick Heal Total Security (Windows)achieved one of the best protection rate in AV-Comparatives test
• Seqrite Endpoint Security certified as 'Approved Corporate Endpoint Protection' for Windows by 'AV-Test'

Product Offerings

Product Portfolio across Business Segments

Retail / SMB – Drives Scalability

• Core Protection

• Privacy Protection

• Safe Banking Features

  • Web Security

• Parental Controls

• Stealth Mode

• Email Security

• Anti- Key Logger

• Track My Laptop

• Data Theft Protection

• PCTuner

• Improved Scan Engine

• Virtual Keyboard

• PC2 Mobile Scan

• QH Remote Device Management

Mobile Security – Huge Future Opportunity

• Growth Opportunities
  • Customers understanding the need for Mobile Security
  • Vast Untapped Market Potential

• Background Scan
• Security & Privacy Advisor
• SafePe
  • Cloud Backup
  • Call & Message Filter
• Register with TRAI
• Anti-Theft Technology
• Cloud Backup

Remote Device Management

Enterprise Business – Drives Sustainability

SEQRITE Endpoint Security (EPS)

SEQRITE Endpoint Security Cloud

SEQRITE Unified Threat Management (UTM)

SEQRITE Mobile Device Management (MDM)

SEQRITE Endpoint Encryption Solutions

SEQRITE Secure Web Gateway Security Vulnerabilities Insider Threats Ransomware Attacks Infected External Devices Malicious Internet Traffic Phishing Attacks Data Breaches Dos & DDos ATTACKS ADVANCED PERSISTENT THREATS MOBILE MALWARE & MALICIOUS MOBILE APPS

PRO-ACTIVE SERVICES

• Technical Audit
• Security Management
• Compliance Audit
• Security Consulting
• Red Team Audit

ACTIVE SERVICES

• Real Time Monitoring
• Security Operations Centre (SOC) Operations

RE-ACTIVE SERVICES

• CERT as a Service
• Digital Forensics
• Incident Response

Future opportunities

Turning Problems into Possibilities…

Cybersecurity Predictions - 2018 Future Opportunities

• Ransomware will be more vicious

• Crpytojacking a new menace to deal with

• Increase in threats to mobile devices

• Artificial Intelligence its use and misuse

• Internet of Things (IoT) will still remain an easy picking for attackers

• DDoS attacks will get more menacing

• Small and medium-sized businesses will remain in the kill zone for cybercriminals in 2018

• Brute-force attacks traditional but still effective

• Biometric authentication data at risk

• Government working on strong data protection regulations

• Enterprises are increasingly adopting security solutions to combat advanced cyber-threats

• By 2022, India's digital economy is expected to grow to USD 1 trillion

• Increase in Cyber Threats in Q3 2019:

  • 288 million cyber threats targeted Individuals and Businesses
  • The main trends include increase of ransomware attacks via Remote Desktop Protocol (RDP) and cryptocurrency mining
  • Over 7000 Ransomware and 33,000 cryptojacking hits detected on a daily basis

• Increase in Mobile Transactions: According to RBI data, mobile wallet transactions hit record 14,632 crore in June 2018

• Proliferation of smart devices will raise cybersecurity risks. By 2020, it is anticipated, the IoT may comprise as many as 30 billion devices

• By 2022, 6 billion people will be vulnerable to cyberattacks

Source : Quick Heal Annual Threat Report

Future Strategy

• Develop and promote software-as-a-

service model

Q2 & H1 FY19 Highlights

Q2 FY19 – Quarterly Consolidated Performance Highlights

29

H1 FY19 – Annual Consolidated Performance Highlights

Based on net revenues before adjusting for sales incentives

Q2 and H1 FY19 - Consolidated Profitability Statement

Particulars (Rs. mln)	Q2 FY19	Q2 FY18	Growth	YoY	H1 FY19	H1 FY18	Growth	YoY
Total Revenue	1,091.32	1,050.63	40.69	3.87%	1,622.20	1,353.79	268.41	19.83%
Direct Cost	53.73	50.88	2.85	5.60%	76.84	68.99	7.85	11.38%
Gross Profit	1,037.59	999.75	37.84	3.79%	1,545.36	1,284.80	260.56	20.28%
Gross Margin	95.08%	95.16%		-8 bps	95.26%	94.90%		36 bps
Operating Cost
R&D Cost	139.52	136.48	3.04	2.23%	281.83	278.66	3.17	1.14%
Sales and Marketing (S&M)	165.48	145.88	19.60	13.44%	318.98	320.03	-1.04	-0.33%
General Administration (G&A)	136.11	122.57	13.54	11.05%	258.83	251.84	6.99	2.78%
Total Expenditure	441.11	404.93	36.18	8.94%	859.65	850.53	9.12	1.07%
EBITDA	596.48	594.82	1.66	0.28%	685.71	434.27	251.44	57.90%
EBITDA Margin	54.66%	56.62%		-196 bps	42.27%	32.08%		1,019 bps
Depreciation	60.16	67.61	-7.45	-11.02%	119.38	131.82	-12.44	-9.44%
EBIT	536.32	527.21	9.11	1.73%	566.33	302.45	263.88	87.25%
EBIT Margin	49.14%	50.18%		-104 bps	34.91%	22.34%		1,257 bps
Other Income	86.85	57.28	29.57	51.61%	150.94	112.63	38.31	34.01%
PBT	623.17	584.50	38.67	6.62%	717.27	415.08	302.19	72.80%
Tax	202.14	199.70	2.44	1.22%	235.13	143.34	91.79	64.04%
PAT	421.03	384.80	36.23	9.42%	482.14	271.74	210.40	77.43%
PAT Margin	38.58%	36.63%		195 bps	29.72%	20.07%		965 bps

NOTE: Certain figures have been re-grouped wherever necessary

Q2 and H1 FY19 - Consolidated Ratio Analysis

In %	Q2 FY19	Q2 FY18	H1 FY19	H1 FY18
Expenses
Direct Cost / Revenue	4.92%	4.84%	4.74%	5.10%
R&D / Revenue	12.78%	12.99%	17.37%	20.58%
S&M / Revenue	15.16%	13.88%	19.66%	23.64%
G&A / Revenue	12.47%	11.67%	15.96%	18.60%
Total Cost / Revenue	40.42%	38.54%	52.99%	62.83%
Margin
Gross Margin	95.08%	95.16%	95.26%	94.90%
EBIDTA	54.66%	56.62%	42.27%	32.08%
EBIT	49.14%	50.18%	34.91%	22.34%
PBT	57.10%	55.63%	44.22%	30.66%
PAT	38.58%	36.63%	29.72%	20.07%

Consolidated Balance Sheet

EQUITY AND LIABILITIES (Rs. mln)	30-Sep-18	30-Sep-17	ASSETS (Rs mln)	30-Sep-18	30-Sep-17
Share Holder's Funds:			Non-Current Assets:
Equity Share Capital	704.89	701.89	Property, plant and equipment	1,651.46	1,716.82
Share application money pending allotment	0.29	0.83	Capital work-in-progress	0.00	133.01
Reserves and Surplus	6,741.95	5,988.21	Other Intangible assets	102.19	51.41
Total Shareholder Funds	7,447.13	6,690.93	Non-current financial assets
			Investments	194.80	66.66
Non-Current Liabilities			Loan and Security Deposits	3.81	3.28
Net employee defined benefit liabilities	14.64	23.86	Bank Balances	3.97	3.06
Other Non-Current Liabilities	19.33	0.00	Deferred tax assets (net)	77.51	71.35
Total Non-Current Liabilities	33.97	23.86	Non-current tax assets (net)	27.33	56.10
Current Liabilities:			Total Non-Current Assets	2,061.07	2,101.69
Trade and Other Payables	395.96	279.07	Current assets:
			Inventories	60.84	64.12
Other Financial Liabilities	8.40	9.85	Investment in Mutual Fund	3,123.02	2,501.78
			Trade and other receivables	1,167.22	639.09
Other Current Liabilities	162.00	138.51	Bank Balances & Cash and Cash Equivalents	152.24	155.09
			Investment in Fixed Deposit	1,478.48	1,653.09
Net employee defined benefit liabilities	16.11	14.00	Loans and Security Deposits	9.00	7.44
Current Tax Liabilities (Net)	67.27	35.27	Interest accured	37.54	28.34
			Other Current assets	41.43	40.85
Total Current Liabilities	649.74	476.70	Total Current Assets	6,069.77	5,089.80
Total Equity & Liabilities	8,130.84	7,191.49	Total Assets	8,130.84	7,191.49

NOTE: Certain figures have been re-grouped wherever necessary

Note:

• Net Working Capital Days for March 2018 = [(Net Working Capital / Half Year Sales) * (365days)]

• Net Working Capital Days for September 2018 = [(Net Working Capital / Half Year Sales) * (180days)]

Calculation is based on net revenues before adjusting for sales incentives

Q2 and H1 FY19 Consolidated Results – Return Ratio Analysis

RoCE = EBIT / Avg. Capital Employed (Equity + Debt) Cash Adj. RoCE = EBIT / Avg. Cash Adj. Capital Employed (Equity + Debt – Cash & Cash Equivalents)

Q2 and FY19 – Standalone Profitability Statement

Particulars (Rs. mln)	Q2 FY19	Q2 FY18	Growth	YoY	H1 FY19	H1 FY18	Growth	YoY
Total Revenue	1,088.56	1,045.32	43.24	4.14%	1,616.44	1,342.54	273.90	20.40%
Direct Cost	54.29	50.20	4.09	8.15%	79.77	69.07	10.70	15.49%
Gross Profit	1,034.27	995.12	39.15	3.93%	1,536.67	1,273.47	263.20	20.67%
Gross Margin	95.01%	95.20%		-18 bps	95.07%	94.86%		21 bps
Operating Cost
R&D Cost	139.52	136.48	3.04	2.23%	281.83	278.66	3.17	1.14%
Sales and Marketing (S&M)	160.34	138.78	21.56	15.54%	309.61	306.50	3.12	1.02%
General Administration (G&A)	131.63	116.94	14.69	12.56%	249.72	243.29	6.43	2.64%
Total Expenditure	431.49	392.20	39.29	10.02%	841.17	828.45	12.72	1.53%
EBITDA	602.78	602.92	-0.14	-0.02%	695.50	445.02	250.48	56.29%
EBITDA Margin	55.37%	57.68%		-230 bps	43.03%	33.15%		988 bps
Depreciation	60.12	67.63	-7.51	-11.10%	119.26	131.73	-12.47	-9.47%
EBIT	542.66	535.29	7.37	1.38%	576.24	313.29	262.95	83.93%
EBIT Margin	49.85%	51.21%		-136 bps	35.65%	23.34%		1,231 bps
Other Income	86.35	56.94	29.41	51.65%	150.10	111.57	38.53	34.53%
PBT (Before Exceptional Items)	629.01	592.23	36.78	6.21%	726.34	424.86	301.48	70.96%
Exceptional Items	50.00	0.00			50.00	0.00
PBT (After Exceptional Items)	579.01	592.23	-13.22	-2.23%	676.34	424.86	251.48	59.19%
Tax	201.97	199.51	2.46	1.23%	234.90	142.99	91.91	64.28%
PAT	377.04	392.72	-15.68	-3.99%	441.44	281.87	159.57	56.61%
PAT Margin	34.64%	37.57%		-293 bps	27.31%	21.00%		631 bps

NOTE: Certain figures have been re-grouped wherever necessary

Q2 and FY19 – Standalone Ratio Analysis

In %	Q2 FY19	Q2 FY18	H1 FY19	H1 FY18
Expenses
Direct Cost / Revenue	4.99%	4.80%	4.93%	5.14%
R&D / Revenue	12.82%	13.06%	17.44%	20.76%
S&M / Revenue	14.73%	13.28%	19.15%	22.83%
G&A / Revenue	12.09%	11.19%	15.45%	18.12%
Total Cost / Revenue	39.64%	37.52%	52.04%	61.71%
Margin
Gross Margin	95.01%	95.20%	95.07%	94.86%
EBIDTA	55.37%	57.68%	43.03%	33.15%
EBIT	49.85%	51.21%	35.65%	23.34%
PBT (Before Exceptional Items)	57.78%	56.66%	44.93%	31.65%
PBT (After Exceptional Items)	53.19%	56.66%	41.84%	31.65%
PAT	34.64%	37.57%	27.31%	21.00%

Standalone Balance Sheet

EQUITY AND LIABILITIES (Rs. mln)	30-Sep-18	30-Sep-17	ASSETS (Rs mln)	30-Sep-18	30-Sep-17
Share Holder's Funds:			Non-Current Assets:
Equity Share Capital	704.89	701.89	Property, plant and equipment	1,651.20	1,715.39
Share application money pending allotment	0.29	0.83	Capital work-in-progress	0.00	133.01
Reserves and Surplus	6,829.49	6,171.75	Other Intangible assets	101.93	51.14
Total Shareholder Funds	7,534.67	6,874.47	Non-current financial assets
			Investments	341.96	367.00
Non-Current Liabilities			Loan and Security Deposits	3.81	3.17
Net employee defined benefit liabilities	14.64	23.79	Bank Balances	3.97	3.68
Other Non-Current Liabilities	19.33	0.00	Deferred tax assets (net)	77.51	71.35
Total Non-Current Liabilities	33.97	23.79	Non-current tax assets (net)	26.87	56.10
Current Liabilities:			Total Non-Current Assets	2,207.25	2,400.84
Trade and Other Payables	392.64	275.22	Current assets:
			Inventories	47.01	53.32
Other Financial Liabilities	20.05	11.16	Investment in Mutual Fund	3,123.02	2,501.78
			Trade and other receivables	1,168.79	613.76
Other Current Liabilities	162.08	137.45	Bank Balances & Cash and Cash Equivalents	114.94	73.45
			Investment in Fixed Deposit	1,478.48	1,653.09
Net employee defined benefit liabilities	16.11	14.00	Loans and Security Deposits	8.26	6.73
Current Tax Liabilities (Net)	66.91	34.87	Interest accured	37.54	28.34
			Other Current assets	41.14	39.65
Total Current Liabilities	657.79	472.70	Total Current Assets	6,019.18	4,970.12
Total Equity & Liabilities	8,226.43	7,370.96	Total Assets	8,226.43	7,370.96

NOTE: Certain figures have been re-grouped wherever necessary

Historical Financial Performance

FY18 - Consolidated Profitability Statement

Particulars (Rs. mln)	FY18	FY17	Growth	YoY
Total Revenue	3,183.15	2,999.78	183.37	6.11%
Direct Cost	167.38	230.18	-62.80	-27.28%
Gross Profit	3,015.77	2,769.60	246.17	8.89%
Gross Margin	94.74%	92.33%		241 bps
Operating Cost
R&D Cost	567.40	635.41	-68.02	-10.70%
Sales and Marketing (S&M)	735.69	728.52	7.17	0.98%
General Administration (G&A)	509.28	504.23	5.05	1.00%
Total Expenditure	1,812.36	1,868.16	-55.80	-2.99%
EBITDA	1,203.41	901.45	301.96	33.50%
EBITDA Margin	37.81%	30.05%		776 bps
Depreciation	269.27	309.45	-40.18	-12.98%
EBIT	934.14	591.99	342.15	57.80%
EBIT Margin	29.35%	19.73%		962 bps
Other Income
–Others	234.06	284.49	-50.44	-17.73%
–Service Tax Credit	65.96	0.00	65.96	-
PBT (Before Exceptional Item)	1,234.16	876.49	357.67	40.81%
Exceptional Item	0.00	37.81	-37.81	-100.00%
PBT (After Exceptional Item)	1,234.16	838.68	395.49	47.16%
Tax	404.12	306.44	97.68	31.87%
PAT	830.05	532.24	297.81	55.96%
PAT Margin	26.08%	17.74%		834 bps

Consolidated Balance Sheet

EQUITY AND LIABILITIES (Rs. mln)	31-Mar-18	31-Mar-17	ASSETS (Rs. mln)	31-Mar-18	31-Mar-17
			Non-Current Assets:
Share Holder's Funds:			Property, plant and equipment	1,611.97	1,782.23
Equity Share Capital	703.88	701.02	Capital work-in-progress	138.72	135.89
			Other Intangible assets	118.54	65.39
Share application money pending allotment	0.00	0.06	Non-current financial assets
Reserves and Surplus	6,534.79	5,915.53	Investments	64.01	66.66
Total Shareholder Funds	7,238.67	6,616.61	Loan and Security Deposits	3.28	4.50
			Bank Balances	2.92	1.83
Non-Current Liabilities			Deferred tax assets (net)	43.71	87.30
Net employee defined benefit liabilities	21.04	22.73	Non-current tax assets (net)	33.90	198.67
Total Non-Current Liabilities	21.04	22.73	Other non-current assets	0.14	46.12
Current Liabilities:			Total Non-Current Assets	2,017.18	2,388.59
Trade and Other Payables	327.06	408.96	Current assets:
			Inventories	56.24	79.40
Other Financial Liabilities	11.99	13.16	Investment in Mutual Fund	3,000.78	1,750.82
			Trade and other receivables	1,030.88	971.83
Other Liabilities	132.60	136.25	Bank Balances & Cash and Cash Equivalents	122.14	195.04
			Investment in Fixed Deposit	1,507.24	1,898.66
Net employee defined benefit liabilities	13.10	14.42	Loans and Security Deposits	8.72	6.21
Current Tax Liabilities (Net)	62.68	123.11	Interest accured	39.00	8.73
			Other Current assets	24.96	35.96
Total Current Liabilities	547.43	695.90	Total Current Assets	5,789.96	4,946.65
Total Equity & Liabilities	7,807.14	7,335.24	Total Assets	7,807.14	7,335.24

NOTE: Certain figures have been re-grouped wherever necessary 44

Key Takeaways

Company : Investor Relations Advisors :

CIN No: L72200MH1995PLC091408

Company Secretary

Mr. Raghav Mulay cs@quickheal.co.in +91-20-66813232 www.quickheal.co.in

Chief Financial Officer

Mr. Nitin Kulkarni Nitin.Kulkarni@quickheal.co.in +91-20-66813232 www.quickheal.co.in

CIN - U74140MH2010PTC204285

Mr. Jigar Kavaiya / Mr. Rahul Agarwal jigar.kavaiya@sgapl.net / rahul.agarwal@sgapl.net +91 9920602034 / +91 9821438864 www.sgapl.net