AvenuesAI Limited (539807) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Infibeam Avenues Limited Earnings Conference Call for Q1 FY 2021 hosted by K.R. Choksey Research. This conference call may contain forward-looking statements about the company, which are based on beliefs, opinions and expectations of the company as on date of this call. These statements are no guarantee of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Ms. Parvati Rai from K.R. Choksey. Thank you, and over to you, ma'am.

Thank you, Aisha. Good evening, everyone. On behalf of K.R. Choksey Research, we welcome you all for the Q1 FY '21 earnings conference call of Infibeam Avenues Limited. I take this opportunity to welcome the management of Infibeam Avenues represented by Mr. Vishal Mehta, Managing Director; Mr. Vishwas Patel, Director as well as Founder and CEO of the Payments Business; Mr. R. Srikanth, President; and Mr. Hiren Padhya, Chief Financial Officer. So we begin the call with a brief overview of the company by the management, followed by the Q&A. I now hand over the call to Mr. Vishal Mehta for his opening remarks. Thank you, and over to you, sir.

Thank you, Parvati. Good evening, and a very warm welcome to all of you on the call. On behalf of the management present on the call, I welcome everyone to our first quarter 2021 earnings call. I hope everyone of you and your family members are safe, and I wish you all the best of health during this COVID times. It is my pleasure to present the stand-alone and consolidated accounts of the company during the call. Our financial results, earnings press release as well as investor presentations have been uploaded on the company website, which is www.ia.ooo. In today's agenda, we will discuss 3 broad topics: first, how we are building a scalable and a profitable global fintech company; second, our operational and financial performance, which is centered around our business model; and finally, third, how we are enhancing value for our stakeholders and our growth drivers. I request everyone to kindly turn to Slide #5 of the presentation, which we have uploaded. Infibeam Avenues is steadily building a very formidable position in the global fintech industry. After building out a leadership position in India in online digital payments over the last 1.5 decades, we have launched payments business in UAE a little over 2 years ago. We've established ourselves amongst the leaders in online digital payment solutions company ranking #2 in UAE among nonbank private companies in less than 18 months, and it also started making profits. In the last few quarters, we've expanded our Saudi Arabia, which is GCC's largest country, in terms of penetration and opportunities and have started offering services also in Oman. Thus, addressing nearly 3/4 of the GCC economies, which also happens to be some of the fastest-growing e-commerce markets in the world only behind Asia. We've also entered into U.S.A. in March 2020, and we've set up other offices in Manhattan, just before the outbreak of the COVID and the lockdowns. We've hired a few resources, including the CEO for Business Development in the U.S. We've also tied up with local banks for acquiring payments, and we aim to leverage our existing relationships and begin by carving out a niche, which is already in progress. As the COVID situation improves, we plan to ramp up our international expansion and launch our fintech operations in multiple additional geographies, which includes Southeast Asia, select African and Arab countries as well as a few developed markets like the United States. We are the only listed fintech company in India with a consistently profitable track record. And we are, soon after the close of trading on 18th September, going to be part of FTSE SmallCap Index. I'd now request everyone to refer to Slide 6 and 7. Over the last nearly 2 decades, since our inception, we've built a very strong customer portfolio with a very lean but very productive and motivated team. We serve over 1 million B2B customers, namely small merchants, businesses, SMEs, corporates, financial institutions and government undertakings, both in India and international markets across a wide range of industries. Our 1 million-plus merchants, through our various fintech offerings, have served more than 10 crore consumers. Our leadership position and comprehensive fintech offering has led to consistently strong customer registrations on the platform. On an average, more than 150 daily registrations happen across education verticals, groceries, utilities, technology companies and retail. The current pandemic has actually triggered a rise in the average daily registrations. This is also evident from the rise in payment volume being processed through our payment gateway post COVID, that is post June. We now have nearly 1 crore or 10 million customer cards on file and who use our checkout at the click of a button. Infibeam Avenues has consistently looked at an asset-light model due to the fundamental nature of the business, that being technology platforms, which can be scaled. We've a lean team of about close to 700-plus employees spread across payments in our platform business with 400 fintech experts. In fact, we had around 320 employees in our payments business over 3 years ago when we processed INR 12,000 crores of payment. Today, with just above 350 employees, we process an annual run rate of INR 90,000 crores. So you can imagine that as our volumes keep on scaling, our employee base does not scale in the same fashion. The additional employees were on account of launch of new business in India and international. Similarly, excluding the resources belonging to corporate functions, a lean team manages the company's end-to-end international enterprise platform business, including IAL's largest platform implementation, the highly advanced e-commerce platform for products and services built by the Indian government procurement, which is called GeM, which is Government e-Marketplace. We have a very small team, largely comprising of business development managers based on our international locations, and majority of the technology integration implementation is done from India. This allows us to scale the international markets at a comparatively lower cost. We have a lean team of 25 sales and business development managers. Our leadership position, strong brand recognition, reliable solutions and top-notch customer support and services that help us to get this thick pipeline of merchants through online registrations. And hence, we do not need feet-on-street model for customer acquisition. It significantly reduces our customer acquisition cost. Now let me discuss with you how we are building a strong, sustainable and scalable business. And I request everyone to turn to Slide #9 of the presentation. Before I get into details, let me highlight the key highlights for the quarter. Our revenue and profitability were down 24% and 39%, respectively, mainly due to COVID lockdown, a global pandemic that had displayed the world order. This has put a start break on the already slowing growth and has rather put the economy into a slightly reverse gear. As you all know, India's GDP fell by 23.9% in Q1 '21, one of the largest drops in the last 40 years. This has led to a significant drop in processing volumes, contracting the revenue and impacting profits in the first quarter. However, cost optimization measures helped us in terms of improving our EBITDA margins by 190 basis points to 38%. Our philosophy to earn profitable revenue allowed us to be quick and profitable despite the pandemic challenge, affecting many industries where companies have reported sharp losses. We have built a very strong business model to withstand shocks, and we are on our way to further strengthen and future-proof our business to withstand any contingencies, which we'll discuss in a moment. Although Q1 has been a challenging quarter, we have seen a V-shaped recovery in our business processing volumes, especially in the payments business. In India, the average daily payments volume recovered by June time frame -- June end time frame compared to the daily average in March. So by end of June, we were at the same level as what we were processing in the month of March pre-COVID lockdown, despite aviation, airlines, travel and tourism, hotel industry volumes that continued to stay very, very low. In the UAE, we experienced the speeding momentum with month-to-month growth in volume and value. We observed an increase of nearly 2x the average daily volume in June '20 versus January '20. In fact, we processed the highest ever payments volume. In terms of value, it was worth INR 7,800 crores in August alone, more than double of what the value was in the month of April, leading to an annual run rate of INR 94,000 crores in terms of processing volume. This is the highest ever monthly value that we have processed in any given month since the inception of the company. One of the reasons for this growth can be attributed to an increasing number of merchants registering for using our payment gateway platform. We are experiencing increasing registrations post-COVID June quarter from about 100-plus daily in Q1 to 150-plus daily post June. Some of the top industry categories that include retail, groceries, education, technology companies, they are all wanting to utilize these services. This is also a testament to a safe and comprehensive payment gateway that offers more than 200-plus payment options in a single integration as well as a strong brand that we have built over the years, attracting customers. Consistent merchant addition will build a strong pipeline for revenue growth for the company over a long period of time. One of the most notable and positive event in the quarter for us has been the sharp rise in bill payment volume through our BillAvenue platform. Due to lockdown, the average daily bills processed through BillAvenue platform increased nearly 2x versus the first quarter of FY '19 and 5x versus the first quarter of FY '18. COVID has led to a sharp rise in digital adoption of utility payments with month-to-month rise in volumes, both on run rate in Q1. We could process 11 million to 20 million bills in FY '21. Just to remind you, we are among the very few private companies licensed by RBI to operate biller operating unit as well as customer operating unit under Bharat BillPay, an interoperable single window system to pay all bills under 1 roof. We have onboarded 35-plus billers across various categories like electricity companies, telecom, direct-to-home municipalities for paying utilities, financial institutions and many more. We are exclusive partners of India's 3 largest gas cylinder companies, which is IOCL, BPCL and HPCL under Bharat BillPay. Our 200-plus agent institution partners, with a network of nearly 600,000 agents on the ground spread across 2,600 cities and towns of India, serve as customer touch points to collect bill payments from end consumers. These agents collect money from consumers and process the payment through BillAvenue platform using the digital cash balance maintained by them with us. Offline physical touch points and cash still dominates bill payments as this is where our large and growing agent network will target as far as the market opportunity is concerned. Please turn to Slide #10. As part of the strategic initiative to expand our revenue stream, we have built a full stack payment platform, offering merchants plug in, switch, payment network connectivity and more to process card payments for financial institutions. Plus we are now adding financial institutions as our customers who require to process a large number of their card transactions connected to various payment networks like Visa, Mastercard and American Express. Vishwas will give you more details on the same later. We have successfully launched the service in Q1 in one of our international markets by tying up with country's second largest bank and have replaced one of the world's top card processor in that bank. This will drive around 20% to 25% of country's online card payment traffic through our fintech platform, CCAvenue Payment Gateway Service. We are also in discussion with country's largest bank, which together will then drive more than 80% of countries online card payment volume through CGPS (sic) [ CPGS ]. We plan to make further inroads in the segment as card processing is payment agnostic and platform agnostic, whether online or offline. We do not have a PG business in that country, but we will process card transactions for the bank. With the launch of CPGS, which is CCAvenue Payment Gateway Service, we have become a comprehensive digital payment solution provider with a top-notch front-end payment gateway and a seamless back-end payment processor, charging merchants for payment gateway and charging financial institutions for card processing. Moreover, unlike the payment gateway business, there is no revenue sharing or pass-through in CCAvenue Payment Gateway Service, while there are multiple revenue streams, including the per transaction fee. This will expand our revenue significantly as we tie up more with card-issuing financial institutions and will also enhance our margins. Another revenue and margin expansion initiative is the launch of CCAvenue Finance to offer lending and card issuance services. India has over 1 million private companies to whom we can offer lending and card issuance service, both credit and prepaid debit cards. We have successfully launched Express Settlement Service to settle merchant funds instantly instead of T+2 and T+3 days for a small additional charge on existing transactions. We have signed a few large companies that are settling multi-crore rupees worth of transactions instantly, which gives us a few extra bps improving our take rates and thereby expanding our revenue. It also improves our margins as it does not involve any pass-through because we are currently utilizing our own funds for settlement. As we generate positive cash flow quarter-over-quarter from other operations, we'll scale and we'll utilize the line of credit already in place to the banks with a low funding cost of just around 2 bps per day against a charge of 10 to 50 bps to our merchants per day for early settlement. We also acquired Cardpay Technologies in June of 2020 that offers spend management solutions to businesses through software-as-a-service-based platform under the brand GRIT. We are targeting to offer credit cards to corporates, including the large pool of marquee clients in our portfolio. The credit cards come with many features and benefits better than traditional corporate cards offered by financial institutions. The platform offers a centralized view of spends to the CFO with an ability for invoice processing, offer virtual credit cards with proper limits and track expense and can be easily integrated with some of the top ERP systems to make accounting easy. Credit card industry is gradually developing in India and corporate spend through credit is also a very large segment, which consistently has shown usage and increasing limits. As the credit card issuer and tie up with the bank, we'll be able to earn higher take rates. Moreover, the value of spend will also be higher as corporates are our customers and not retail individuals. We perceive relatively lower risk in the business as we will target our existing merchants who process through CCAvenue, which have consistently shown revenue stream flowing through our platform, serving becomes a backup and a collateral for our collection on card spends. From Q1 onwards, Go Payments has also become our subsidiary. We own 52.38% of Go Payments now. Go Payments offers various financial services like domestic money transfer, recharge, EPS service. They are Bharat BillPay agent institutions also. They undertake several other channel services. We are partnering with Go Payments targeting corporate employees to offer RuPay prepaid cards, general purpose cards and meal cards. Employees can now spend on these cards at any merchant outlets which accepts RuPay. Through various card programs, we can earn a net take rate in the range of 50 to 100 bps. This will expand our revenue as well as boost our margins. Finally, our demerger scheme to unlock shareholder value is on track. We have received consent from stock exchange to file with NCLT in the month of July. And subsequently, we have also filed the application with NCLT. We have 2 large strategic deals which are work in progress, which will differ slightly due to the recent COVID pandemic. It will enhance revenue and margins and establish us as a strong brand both domestic as well as internationally. I will now hand over the call to Vishwas, who will brief you on the fintech business and how we are building out. Vishwas, over to you.

Thank you, Vishal, and good evening to all of you. If you can all please turn to Slide #11. So our fintech addressable market is expanding continuously with multiple growth trajectories. The growing demand from the ecosystem, consumers, businesses and corporates, financial institutions, governments are driving expansion of the market. The card company, Visa states that the new flows due to this market expansion globally, has brought a huge USD 185 trillion, of which B2B has brought around USD 125 trillion. We believe in the exciting times for the fintech to witness a strong growth. If you all can turn to Slide #12 of the presentation that has been uploaded. So in order to tap early into this market, we have built ourselves into a comprehensive one-stop payment solution providers, which I'll discuss in the next slide. We have a focused strategy over the short and medium-term to expand our revenue streams from this market expansion through: deep penetration in existing markets; launching of new fintech solution as a comprehensive offering; and expanding in international markets. We are also focused to become a powerful international brand, offer leading technology to simplify business and payments, nurture talent and be ESG that is Environmental, Social and Governance compliance. If you can all turn to Slide #13. So we are building ourselves into a comprehensive fintech solutions provider. We are simultaneously expanding our revenue streams, which will further enhance our operating as well as the profitability margins. We have built 7 strong and robust fintech platforms and addressing most of the digital requirements of the merchants to simplify business and payments. Our existing business until FY '20 focused on offering a payment gateway to merchant, and a white label to banks in case the merchant goes to the bank for payment gateway services. We also launched ResAvenue platform a few years ago to specifically target the hospitality industry, which is for spacing issues and selling its room inventory in which we integrated our payments platform to simplify business and payments for the hospitality sector. In November 2017, we launched BillAvenue, which is an interoperable bill payments platform under the Bharat Bill Payment infrastructure to increase our markets and the utility industry as well as be an early mover in processing bill payments across various industry categories, which Vishal mentioned earlier. We have a strong SaaS enterprise platform that can handle end-to-end e-commerce implementation for large enterprises, where we have 0 to negligible contribution. We have clients like the Government e-Marketplace for whom we are the key e-commerce technology providers whom we have customized and offered our enterprise e-commerce platform. Beginning Q1, we have several fintech platforms that allow us to be a one-stop go to online payment solution provider, be it for merchants, corporate, government or financial institutions. Since Vishal has already covered in some detail the introductory part, I'll spend less time on this here. So we launched our B2Biz solution to automate payments and collections for big corporates and businesses. We launched our CCAvenue Payment Gateway Services, which we have nicknamed CPGS, a backward integration into our payment gateway business where financial institutions can become our customers. We have launched CCAvenue Finance from where we'll offer secured lending as well... [Technical Difficulty]

We would request the participants to please stay connected as the line for Mr. Vishwas Patel has gotten disconnected. Mr. Patel, you are in the main call, you can go ahead please.

Okay. So sorry for the call drop suddenly. So I'll continue. These fintech platforms will expand and funnel significant digital payments and transaction processing traffic to our platforms, augmenting our revenue and further enhancing our operating as well as profitability margins. Let me quickly brief you about these businesses, and we are happy to engage with you offline if you need a deeper understanding of these businesses, the opportunity and the scale that we are pursuing. You may also get in touch with Purvesh, our Investor Relations Officer, his details are mentioned on the last page of this earnings presentation. Now quickly turning to Slide #15. Payment Gateway is our existing business, which we launched way back in the year 2000, 2001. So we were among the India's -- we were India's first online payment gateway service providers in India. We today ranked #2 in India and the UAE. We are among the few consistently profitable digital payments company in India since our inception. In a single integration, we provide almost 200-plus options with multi-currency... [Technical Difficulty]

We would request the participants to please stay connected while we join Mr. Patel back in the call.

Okay. So we are integrated with most of the -- most market business and the industry verticals. We offer our PG solution, which is white label to some of the top banks in India, like HDFC Bank, Kotak Bank as well as JPMorgan Bank. So it's a bank grade enterprise level software, our PG solution, which works as a white label for all these banks, who trust us with our technology and robust technology, and they will use us to offer our solution -- our PG solution to their merchants. We have expanded this business outside India also in select GCC economy and the U.S.A. Further global expansion is in the unveiled through our country-in-a-box strategy. Our payment processing volume has grown 10x in the last 5 years. After a sharp drop in volumes in India in April, we have seen recovery from May and surpass the average daily processing transactions by the -- of value by volume and value by the end of June. We're experiencing month-on-month growth since the dip in April. So in August, we processed the highest ever monthly payments volume of more than INR 7,800 crores, that is more than $1 billion mark. This is despite our key merchants like the -- in the aviation industry, the hospitality industry, travel, tourism, entertainment, yet at their historical lows. We estimate that despite low volumes from these sectors and about ending -- without adding the launches of the new markets, we'll still be able to process around INR 75,000 to INR 80,000 crores worth of payments in FY '21 from India and the UAE alone, higher than INR 62,000 crores worth of payments that we processed in the last financial year. Strong tailwinds in India and GCC and a large market in the U.S.A., with our international expansion plans, is expected to increase the volumes process to our gateway significantly. If you turn to Slide #16, it will give you a snapshot of a strong position in UAE. Our average daily volume in June increased by approximately 75% compared to the daily average in March. We are on a run rate of processing around AED 2.2 billion to AED 2.5 billion in UAE in FY '21. If you move to Slide #17, we are experiencing a sharp increase in the bill payment volumes also through our BillAvenue platform. BillAvenue has seen a sharp growth year-on-year since its launch 2.5 years ago. Q1 has experienced a sharp price as more number of billers and higher number of consumers are paying their utility bill through the BBPS channels. As per RBI estimates in 2017, more than 20 crore bills are generated every day in only 20 cities in India. Only about 750 billers are currently online generating a volume of 2 crores per month. The scope is vast, and we are amongst the early movers, with a network of nearly 600,000 agents spread across 1,200 cities and towns across India. Cash is still dominant for bill payments in India and thus, RBI allowed to build a system to accept money in cash from consumers to be digitally converted at a point-of-sale by agents by maintaining additional cash balance with the BBPS service provider and pay digitally on behalf of the consumers with the cash receipt. If you move to Slide #18. A few years back, we started targeting the hospitality industry to offer our payment gateway, and we faced an unusual challenge from the hotel owners. They wanted a solution to sell their perishable room inventory first before attaching a payment gateway to their website. So we've built entire central reservation system and a channel manager, ResAvenue platform to allow them to sell the inventories across various sales channels, OTS -- OTAs and integrated it with a PG for collecting online payments. This allowed us to be the leaders in the hospitality segment, serving almost all the major brands in some form or other through our platforms, including the ResAvenue platforms. All the top hotel groups like Taj, ITC, Oberoi, Lemon Tree, to name a few, Hiltons in UAE are some of our coveted clients under our platforms. We have over 2,000 plus hotels in our platform in India and UAE and nearly 1 million rooms are serviced for the ResAvenue platform. If you move to the Slide #19, it gives you an overview of the new businesses under the digital payments and our revenue and profit drivers. Then moving on to Slide #20, we launched B2Biz to automate business payment and collection receivables as well as payables for long vendor payments for big corporates and MNCs. We are directly onboarding merchants as well as we have provided this solution also as a white label solution to HDFC Bank. Based on our estimates, we believe that we are able to process over INR 75,000 crores of transaction in the next 2 to 3 years through these solutions. Corporate volumes are consistently higher. And moreover, we are in discussion to onboard a very large client, which will significantly boost volumes and value of transactions under B2Biz. Move on to Slide #21. We launched CCAvenue Payment Gateway Service, that is CPGS service in June and went live with the second bank in one of our international markets. CPGS is a backward integration in the PG business, allowing us to charge financial institutions for processing Visa, Mastercard, American Express cards for them. This business really is theoretically payment gateway and platform agnostic. So any transactions of Visa, Mastercard and Amex is processed by the partner bank will be processed and routed through the CPGS platform. The current tie up with international bank allows us to process the country's 20%, 25% of online transaction. We're in discussion with the largest bank in that country, which -- along with the second largest bank will allow us to process 80% of all online transactions in the country. There are multiple revenue streams attached to the business, including a per transaction fee with no pass-through, as pass-through is already absorbed by the regular PG pricing. We have big plans to expand this business globally, and we are currently working aggressively to expand this business. Move on to Slide #22. We are partnering with Go Payments to launch prepaid cards. I've already mentioned in detail about this business in our Q4 call. However, Go Payments from May 2020 is our 52.38% subsidiary from a 48% investor company earlier. This is a low-risk secured business with the ability to earn high margins in the range of 50 to 100 bps net compared to the less than 10 bps in the PG business. If you move to Slide #23. We acquired Cardpay Technologies in June of 2020, operating under the brand GRIT to make inroads into the credit card issuance. Over the last 2 decades, we have onboarded over 1 million merchants across our fintech platforms. In order to monetize on a PG and other financial offerings, we are offering credit cards, GRIT cards to merchants whom we have a consistent business and which will also serve as a collateral towards collections by the corporates. We have the ability to earn almost 2% as gross take rates and 1.5% or higher as a net take rates as we'll be the issuers of these cards. The business is currently live on a small-scale due to COVID, but you will steadily scale from October onwards. Moving on to Slide #24. Express settlement is already live with some merchants transacting daily. We are charging a small additional fee on the existing TDR to the merchant. This additional P is a service directly offered by us. It does not include any pass-through charges. Currently, the scale is small, and we have initiated this business to utilizing our own funds to settle instantly versus the receipt towards the next day into our nodal account. However, the funding cost is 0 and the entire additional fee adds to our top line and margins. Once we scale, we already have an arrangement with our bank who offers us a credit line for as low as 2 bps per day charge to customer, and we can charge to the customer around 10 to 50 bps per day. This will enhance our net take rate and margins. Moving on to Slide #25. So far, we have discussed on the 6 digital payment platforms. The seventh fintech platform is an Enterprise Software Platform for e-commerce industry. This is one of our earlier business just like a PG business. We offer e-commerce platforms to large enterprises from end-to-end capability to launch an online business of such scale. We work with enterprise clients in India and UAE. Some of the marquee clients include: Government e-Marketplace, or gem.gov.in; Saudi Telecom; Jumbo Electronics in the Middle East; Sony; Axiom, et cetera. So we both have a transaction fee as well as a license fee-based revenue model. GeM is one of our significant clients in this segment, whom we have transaction-based fee model on the value of procurements. We have processed more than INR 55,000 crores worth of transactions over the last 2.5 years. More importantly, we do not have a pass-through in a business like PG and most what we earn flows through EBITDA. GeM under the new initiative plans to make an unified procurement portal for all government body procurements. It is integrating the Indian Railways which does about a yearly procurement of INR 70,000 crores. This will be followed by Indian Defense, CPP and other portals being integrated. This will significantly increase the GMV process to the platform and hence, our top line and margins. If you move -- if you go through the next 3 slides, slides 26, 27 and 28, we have a very strong out-of-the-box capabilities in the platforms and payment business, and we can deliver 10x value proportion to all our customers. We are far ahead of our competition in terms of our portfolio offering as well as the technical capabilities. If we refer to Slide #28, right, we have built a comprehensive fintech portfolio, a one-stop shop for merchants and financial institutions. Today, none of our top competitors have a portfolio like what we have built. This is also because of the talent we nurture within the organization that has helped us build such platforms and offer round-the-clock support services to our merchants. In the process, we have built strong brands in our portfolio that will identify us in the industry. If you please refer to Slide #29. I will now hand over the call to our CFO, Hiren Padhya, to discuss the financial performance. Thanks.

Thank you, Vishwas bhai. Good evening to all of you. Now please turn to the Slide 31, that is financial performance. The company is well positioned to capture growth from the ongoing digital transformation, led by both consumers and enterprises, which has been further accelerated by the prevailing pandemic situation. Our fintech platforms are capable of generating significant processing traffic. We are broadening and diversifying merchant base across the business verticals globally by addressing changing preferences in the post COVID-19 environment. The revenue impact of pandemic played out broadly along the lines we had indicated earlier in Q4. It affected all verticals with varying levels of impact with the exception of the revenue platform. Due to ensuring -- sorry, due to ensuing restrictions on travel, entertainment, hospitality, there has been a drop in volume and value of transactions impacting operational and financial performance during the first quarter of FY '21. However, by the end of June, the average daily payment volume and value surpass the daily average we recorded in the month of March, despite ensuing restrictions and the volume being low in India, while the UAE registered month-on-month growth in volume and value, including in the Ramadan month of May. We believe merchants across segments have started stabilizing their operations and are now embarking on new beginnings to adopt and thrive in a post pandemic world, thus indicating strong indication of recovery and tracing part to the overall growth in the corresponding periods. Further, the company has registered improved operations margins on account of cost-optimization measures and efficiency parameters. The EBITDA margin improved by 190 basis point to 38% in Q1 '21 versus 36.1% in Q4 '20. That said, let me quickly discuss the consolidated financials and operational performance in Q1 '21. Revenue was INR 103 crore, down 24% quarter-on-quarter, temporarily impacted due to COVID. We have undertaken several strategic initiatives to expand revenue streams like new businesses in payments, international expansion, lending and card issuance, targeting enterprise clients, et cetera. We are also experiencing strong growth post COVID June quarter in the existing payment gateway business in India and UAE. A robust growth in bill payment through BillAvenue new platform and offering a white label situation to top domestic and international banks adding more banks, and thus more payment options on our payment gateway to increase traffic on our payment gateway platforms. This will augment revenue and margin expansion. Second, prudent cost optimization and efficiency measures led to EBITDA margin improvement to 38% at INR 39 crore, up 190 basis point quarter-on-quarter. Third, profit after tax was INR 12 crores, down 39% quarter-on-quarter. Fourth, payments processed value was INR 14,200 crore, down 16% quarter-on-quarter and number of payments transaction process were 36 million, down 10% quarter-on-quarter. The decrease was due to significant drop in nonessential goods and services volume in April and May, which recovered only in second half of the month of June. However, bills processed through BillAvenue platform increased 12% quarter-on-quarter to 2.6 million, a 66% year-on-year jump, and amount of bills processed increased 9% quarter-on-quarter to INR 169 crore. If not for COVID, the financial and operational performance quarter-on-quarter would have been positive, with payment value surpassing to over INR 20,000 crore with volume of 45 billion based on March 2020 run rate. This would have led to revenue of INR 160 crore, up 16% quarter-on-quarter. EBITDA would have been increased by 8% to INR 53 crore and profit after tax would have increased by 28% to INR 24 crore, that is excluding exceptional gains. Our new business and international expansion will exponentially increase volume and thus earning improvement in take rates, profitability margins and cash flows. Infibeam is almost debt free with optimum utilization of internal accruals and having negative working capital requirement. The company has the ability to generate cash despite severe pricing pressure from the competition. We have strong relationship with merchants and banking partners helping counter predatory pricing and lowering churn. Prudent and optimum use of CapEx helps generate surplus cash, which can be used for organic and inorganic growth. We are consistently converting EBITDA to cash. We are already experiencing a V-shape recovery in the payment business despite much of volumes from aviation, hotel and travel, and tourism yet to recover. Platform business could see a significant jump once Indian Railways, Defense and other platforms are integrated into GeM and the government's plan to have a unified procurement portal for all government requirements. 2 large strategic bills have been deferred to next quarter due to COVID, which will add to our top line and improve margins. All these initiatives will significantly expand the revenue and margins for the company over the short to medium-term and enhance business value. With this, I now hand over to -- call to our MD, Mr. Vishal Mehta to discuss the growth drivers and then open the floor for Q&A.

Thank you, Hiren. As we embark on our future journey, we are very confident of evolving into a more responsible, sustainable, profitable and a growth-oriented organization. I would specifically like to thank our entire team, the employees of Infibeam Avenues. Our employees are our greatest asset and customer centricity is at the center of our business discussions and decisions. They have given excellent performance during this challenging quarter and ensured business continuity. Needless to say the growth that we are experiencing and the business that we are building would have been almost not possible without our exceptional employees putting in their time and effort. We recognize our responsibility to support both their professional and personal lives, and we are confident of delivering robust and multiyear profitable growth across our businesses. I would now like to open the floor for questions and answers.

[Operator Instructions] The first question is from the line of [ Anuj Rai ], a shareholder.

Yes. This is [ Anuj ] here. And I have a question. Is there any update on this e-marketplace that we had a participant with this government to create this marketplace for local markets? Is there any update on that? Like how we are going ahead and what is our development plan on this? And another 1 is this data housing part. So we are building our cloud-based system like a data warehouse. So what is update on that part?

Sure. Mr. [ Anuj ], this is Vishal Mehta. Basically, we have given our platform to government, in that we have given it to Government e-Marketplace, which we talked about, which is the procurement of the country. And that particular marketplace has processed INR 55,000 crores of transactions. Recently, there has been announcement that Indian Railways is onboarding the platform with an annual procurement value of INR 70,000 crores as well as defense is onboarding it, and that has actually worked out very well in terms of the overall opportunity and space. We've also given the same platform to the government or a similar platform for Vishwagram Project. So it's eGram Vishwagram where our platform is being utilized, where we provide infrastructure as well as onboarding to certain institutions and government clients. That's orthogonal dimension to the implementation of the platform compared to what we have given to the Government e-Marketplace, which is more centered and catered towards the procurement of the country. I think if you look at the number of merchants who have onboarded Government e-Marketplace, which is the largest initiative. And the reason we talk about it is because it is one of the largest implementations we have made for the government. There are more than 4.5 lakh unique sellers who have onboarded all the way from weavers, artisans, you name it. And so if you look at -- and if you go to the page, which will talk about the statistics of Government e-Marketplace, you will notice that more than 50% of the transactions by value is going to MSMEs. So the number of MSMEs and SMEs who are onboarding the framework to be able to sell to government, government institutions and so on and so forth have significantly increased. And one can track real-time updates and reports in terms of how the progress of the platform is working out. To your second question about the data warehouse. So we've set up a Tier 3 data center, with a very robust framework that allows us to move all of our workloads. We've moved quite a significant number of our own workloads to be able to go and support the build-out of what we are doing right now. And the second thing is that we've also onboarded third-party clients. So there is a value to what we are building out. We think of this as supporting our growth, at least in the short term because of the build-out of what we are doing right now versus what we would be offering to third party. It's more internally focused. We've also started onboarding a few clients. We've got clients all the way from universities, colleges and many others who are providing online classes, education classes, so on and so forth, who want certain services, so we've onboarded them as well. And we'll continue to invest and look at opportunities and given that a lot of services are now going online, high-bandwidth consuming, high-compute consuming applications are the ones that we'll focus on to be able to build up our own presence there.

[Operator Instructions] The next question is from the line of Pankaj Chopra from Siddhartha Asset Management.

Yes. I just got disconnected from the call, so I don't know whether you addressed this. There was 1 small question on the financials, a little bit intriguing. If I see -- if there was no COVID, your revenues would still be lower on a Y-o-Y basis, and so also EBITDA and PAT. Could you comment on what kind of pressuring revenues and EBITDA, even if COVID wasn't there? I mean I'm referring to Slide 31.

Yes. So Hiren is with me on this, but I'm just looking at Slide 31 for a second. Siddharth, just one second.