C. E. Info Systems Limited (MAPMYINDIA) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the C.E. Info Systems, MapmyIndia, Q1 FY '25 Earnings Conference Call hosted by Anand Rathi Shares and Stock Brokers. [Operator Instructions] I now hand the conference over to Mr. Shobit Singhal from Anand Rathi Shares and Stock Brokers. Thank you, and over to you, sir.

Thank you, Steve. Good morning, everyone. On behalf of Anand Rathi Institutional Equities, we welcome you all to Q1 FY '25 Conference Call of C.E. Info Systems, MapmyIndia. We have with us today Mr. Rakesh Verma, Co-Founder and Chairman of the company; Mr. Rohan Verma, CEO and Executive Director of the company; Mr. Anuj Jain, CFO; and Saurabh Somani, Company Secretary. I will now hand over the call to Mr. Rakesh Verma for his opening remarks. Post that, we will open the floor for Q&A session. Thank you, and over to you, sir.

Thank you, Shobit. I'm Rakesh Verma. Good morning to everybody. The company has shown growth across all the financial metrics: revenue, EBITDA or PAT. It has been a good start for the fiscal year '25. The revenue grew at 13.5% to INR 101 crores. The EBITDA has grown 14.3% to 42.8% (sic) [ INR 42.8 crores ] margin, and the profit after tax, PAT, has also grown 12% from INR 32 crores to almost INR 36 crores. If I give the business-wise breakup between Map-led and IoT-led, the total -- out of total revenue of INR 101 crores, INR 78 crores was contributed by Map-led business, and INR 23.5 crores was contributed by IoT-led business. The sale of hardware, specifically, I wanted to address that out of INR 8.9 crores of sale of hardware, this number shows less than FY '24 Q1 of INR 15 crores. Now this reduction in the sale of hardware was compensated by the sale of services, which grew from INR 7.7 crores in FY '24 Q1 to INR 14.6 crores. This was by some strategic design on one side. And the second also, the nonavailability of funds to Gtropy, which is our IoT arm, and that has been solved with the approval from shareholders on the 9th of this month. So we'll see now, again, the rise of hardware sales as the time goes by. EBITDA -- if you look at it, the EBITDA has gone -- for Map-led business has gone up from INR 36 crores to INR 39 crores year-on-year and from INR 1.4 crores to INR 3.7 crores for the IoT-led business on a year-on-year, which translates into 50% margin for the Map-led business and 15.7% EBITDA margin for IoT-led business. Now the profit and loss statement that has been shared with all the shareholders in the stock exchange, 1 or 2 small detailed analysis or explanation I would like to give so that you can understand it better. There's an expense area of what is called technical services outsource, and that has gone up to INR 11 crores in this quarter, as against it was -- out of that INR 11 crores of technical outsourcing services, primarily these services costs were incurred to support the revenue which you find in sale of software of INR 92 crores. So other than that, the rest of the expenses are pretty much in line with what was in Q4 and what was in Q1. Now with this little financial details, I'll ask Rohan to share with you his thoughts and explanations on the various other financial and nonfinancial part of the business.

Good morning, everybody, and thanks, Mr. Verma. As Mr. Verma said, we got off to a good start in the quarter. A&M revenue grew 9.5%, and C&E revenue grew 16.9%. Basically, new customer acquisition was good across -- in terms of upselling, cross-selling, new use cases, I think all of those, we've seen good kind of progress on. When it comes to automotive, it's been interesting. We won a leading electric commercial vehicle OEM as well as a utility -- large utility vehicle OEM. And also, bunch of interesting key go-lives across ICE and EVs, whether it's the Mahindra XUV3XO or the BYD Atto 3 and, in the 2-wheeler segment, electric scooters like Ampere Greaves Nexus or the Ultraviolet F77 premium electric bike. Similarly, kind of an advanced e-horizon, ADAS and advanced EV software, basically, which tells about the road ahead to support autonomy functions like intelligent speed assist or highway assist as well as for giving range prediction to consumers. Those have started to see the adoption. And so premiumization of vehicles, that is happening. EV or ADAS is seeing increased adoption of our solutions. Similarly, on the fleet side, whether it's monitoring of mine vehicles for large metals or video telematics for employee transportation, all kind of schools are deploying our solutions. All of that is seeing growth. And on the C&E side, growth has been 16.9%. And very, very interesting use cases, whether it's flood modeling as well as water management in East Indian cities. This involves 3D digital twin mapping, which we are doing, as well as go-lives include, for example, the Dial 112 project of the UP Police as well as the prestigious Indian army defense project, which leverage our capabilities. But also on the corporate world, there's e-commerce, QSR, delivery and mobility companies which are using our APIs for various use cases, like location personalization or address capture. And also, in the BSFI and retail sectors, multiple companies are using us for analytics like credit assessment or store-wise sales prediction, sales and analytics for business expansion, et cetera. So I mean that kind of -- that bodes well. Like we started the year with a INR 1,300 crore open order book. We are well on track to achieve our milestone that we've set for FY '27, FY '28 of INR 1,000 crores, and more and more adoption of our solutions as well as innovation that we're doing in our products set us up well. We also added in this last quarter this -- the offering for AI-driven data analytics and consulting for the company. And that gives us more kind of wallet share, closer access and closer engagement with customers and gives us more reason why customers will work with us. I also want to address besides the regular business update, something that has come up in the last few weeks. We've tried to stay quiet about it, not making public statements, not responding to media inquiries because it's a matter we're pursuing legally. But post the quarter results, as part of our quarterly media interactions, we were asked pointedly about it, so we had to address it. This is to do with a legal notice that we have served to Ola Electric for breach of terms and conditions of our contract. Just for context for you all, as you know, MapmyIndia has been building digital maps and pioneered this space and building it from the ground up since 1995, servicing many, many customers. In 2015, Ola ANI Technologies are licensed and got access to our map data and in -- which they continue to use. And in 2021, Ola Electric licensed our APIs and SDKs, or software development kits and application programming interfaces, for their navigation in their vehicles and continue to use us. So for -- because we have seen certain breaches of terms and conditions, we have started the process -- legal process. I'm not going to comment further on that, just to say that we are there to defend the rights of our company and our shareholders. And separately, also, let me just preempt because there's been a lot of noise in the marketplace around competition that is coming up, whether -- Ola Maps has been talking about things from the product point of view or from the pricing point of view as well as Google Maps has also been making statements around pricing. Two points I want to make. MapmyIndia is the premium map provider in the country, offering the best value to customers. And so we are pretty confident about our market position. And these different dynamics that are at play, actually, we don't see a risk to our business. We only see kind of, with more noise and more awareness, more adoption happening. And we are -- we believe we will be the winner -- disproportionate winner in the market that gets added on due to all this activity. Just mapping is a very difficult business. It's a very serious business. It requires long term expertise, investment, time, capital and a track record of servicing customers across industry verticals for use cases that stress test the map in different ways for its accuracy and usability. And only that creates a map that customers would like to choose. There have been hundreds, if not thousands, of companies globally that have tried to get into mapping. In India itself, there have been tens, if not hundreds, of companies. We faced competition for the last 20, 30 years. But in the world, you can count on your fingertips, 4, 6, 8 companies that have sustained and succeeded. And India, it is us. So we are there from an accuracy and quality point of view. And also, we are not just standing still. We are innovating, not just on the 2D side but 3D, high-definition, updation in near real time, so 4D, so many features, so many different solutions. We are not a single-product company. We're a multi-product, multi-industry company where our maps are being used across the board, and we have solutions on top of it. So we are pretty confident on our competitive positioning. When it comes to pricing, we actually price based on value for customers. It's a mutual agreement, and we don't see an impact of this pricing by at least the foreign player on it because in any way, we were price conscious. And if you look at kind of the history of other players, sometimes giving it free, sometimes charging, sometimes charging a lot, sometimes reducing. We've been fairly predictable, reliable and value based for our customers. And in our conversations, this is not something where we are overtly concerned, but we are deeply engaged with customers. We are also increasing awareness about our products and solutions because the more that people know about our solutions, we feel that, that will give us more market. So I'll conclude my remarks with that.

Thank you, Rohan. I guess Shobit will take over from here now.

[Operator Instructions] The first question is from the line of Shobit Singhal from Anand Rathi Shares and Stock Brokers.

Sir, I have 2 questions. So first one is, sir, with the government focus on cadastral mapping. So cadastral maps target of having georeferencing of around 6.5 lakh villages, of which around 3 lakh Indian villages have been done. So are we part of it and how to look at revenue flow from this?

Sure. Shobit, this is Rohan here. Yes, land records and cadastral maps, this is something the government in general over the last 10-plus years has been focused on. There's both a rural angle and an urban angle to this. And we've been participating in it. This is part of our addressable market. We are quite well positioned here. We are able to do the mapping of land records, not just 2D but also now 3D with our drone-based digital twin capabilities. We are also able to offer software solutions on top of that through our geospatial platform, whether for property tax management systems so that municipalities can earn property tax based on land records, all through our geospatial platform to help in urban or rural planning as well as linking to this ULPIN, which they're calling the Unique Land Parcel Identification Numbers, what we call is Mappls Pin, which is a unique digital address for every place. And so we can link the 2, ULPIN and Mappls Pin, so that anybody can get -- their land parcel can be uniquely identified and services can be delivered to them, not just the location information. And so there are very interesting ways in which we are deeply involved when it comes to a mapping or software or other solutions in this. And so we are happy the government has put an impetus on us. It will aid in our addressable market and our growth in the time to come.

Okay. And sir, my second question is in IoT. So hardware, so around 42% year-on-year decline in revenue and around 60% Q-on-Q. So what led to decline in revenue? Are we facing any challenges here? And typically, what is the gestation period for said income to flow once the hardware is sold?

Shobit, I don't know if I understood your question very well, but let me try. And if I -- if you think that you didn't get the answer, you can ask me again. See, IoT, we are pretty bullish, and it's going on the very nice track, and -- like the way from INR 8 crores to INR 50 crores to INR 100-plus crores growth you have seen in the last 3 years since we got serious into the IoT business. This year also, I'm pretty confident that we'll have a pretty good growth in the IoT business. Just don't look at the Q1. I think I tried to answer that right in the beginning that one was lack of funds with the Gtropy, which we needed to get approval from our shareholders, which we have gotten approval now. So going forward, you will not see that as a reason for not having the growth. Growth will be there. But the good thing also, if you look at the SaaS part of the IoT business, it has shown very good results. I think it's almost like 16%, something like that.

90% growth.

90% growth in the SaaS business of IoT.

The next question is from the line of Chandramouli Muthiah from Goldman Sachs.

My first question is just a follow-up on the IoT business. Thanks for your earlier comments on that. So just trying to understand the interplay between the software part of the IoT business and the hardware part of the IoT business. You think that the hardware part is sort of an installed base on which the software bit can be annualized potential revenue there. This quarter, we've seen a meaningful pickup in software part of the business, which I'm guessing is slightly higher margin. So just trying to understand how the interplay between sort of hardware installed base and software annualized revenue should ideally work in your plans going forward?

Sure. Thanks, Chandra, for the question. This is Rohan here. You're right. SaaS is definitely higher margin. And as you said, hardware -- we treat hardware as an installed base. So when we install the hardware, then that customer takes the SaaS from us going forward. So it generates those SaaS annuities. So the more our installed base, the more our SaaS revenue will grow. Sometimes, actually, this kind of quarter pause or quarter reduction in hardware just kind of shows you the strength of the SaaS business also of the IoT, with a meaningful pickup in SaaS income and, hence, margin. But there's such a large addressable market out there, and we have such great hardware. And we're going deep into the design and engineering of these hardware also so that we can make really specialized solutions or appropriate solutions for the different segments of the Indian market, whether it's in the auto OEM side, where a line fit win, for example, we had talked about last year, or whether it is in the aftermarket for various sectors. There are so many sectors where IoT can be useful: energy, logistics, mobility, consumer gadget. So there's a huge headroom. We're very excited. Keep this quarter as a one-off when it comes to hardware. We are very focused on growth of the IoT business, and they both kind of support each other. SaaS, I think, will keep happening. And then as hardware base grows, SaaS further gets uplift.

Got it. That's helpful. My second question is just on the INR 1,000 crore target that you've set for yourselves in FY '27, '28. That would imply sort of mid-30s to maybe 40% annualized top line growth. Just looking through your financials over the past 3 years, it looks like 1 out of 4 quarters, sometimes because it's a B2B business, might be a little slower versus that run rate. So just trying to understand in FY '25, how to think about that slight lumpiness in the business. Is this sort of the one-off quarter that you foresee in your business planning for FY '25? And do you see the balance 3 quarters as being on track for that 35% to 40% growth target that you've set out for yourselves?

Chandra, you're right. Like if you look at -- I mean, let me answer it in nuanced way actually. So if you look, our revenue is predictable based on our open order book, right? And so you've seen over the last few years the track record of our open order book and new order bookings, that has grown significantly. I mean it was INR 1,300 crores at the beginning of this year. It was INR 900 crores, if I'm not wrong, the year before. And the year before, I think it was INR 700 crores, INR 699 crores. So -- and that will all add up into revenue in the coming time. So that's what makes us fully very confident, fully confident of achieving our revenue milestone of INR 1,000 crores by FY '27, FY '28. In our business, this is an annual business, as we've explained before, yes, there can be lumpiness. So quarter-on-quarter movement can be there from here and there. We are not concerned overly about it because we know if something doesn't work out in a quarter, it will work out in the coming quarters. So in that sense, I just want to give that -- I mean, reiterate that we are confident about our revenue milestone, and the business is building up in that direction very nicely.

Got it. That's helpful. And my last question is around the Hyundai contract that you've discussed over the past couple of quarters. I think there was some commentary in the investor presentation for this quarter that there was a ramp-down in some of the older contracts. So just trying to understand, is the ramp-down related to some of the older Hyundai business ahead of the pickup? And when exactly would you say the new Hyundai contract, I think, the INR 400-plus crores that you mentioned over a period of time, when exactly is that flowing through into your business plan?

Yes, Chandra, you're right. We -- this ramp-down was in fact with the old program of Hyundai-Kia, so -- and the ramp-up has actually begun. If you notice, all Hyundai-Kia cars on the road currently, in fact, actually have already switched MapmyIndia on, which was on the road. And even their companion app now has MapmyIndia. So we are very excited and grateful to Hyundai. It's the most -- one of -- if not the most, one of the most advanced automotive players when it comes to technology, and they're fully leaning into all the advanced tech for, what we call, NCASE for the next generation. And we have a very close and strong relationship with them. So Q2 ramp-up of the next generation has begun. And over the course of time, this fairly lucrative contract for us will unfold in terms of revenue.

The next question is from the line of Ikshit Naredi from Naredi Investments.

So my -- like my -- the basic question is on business, so -- on our Map-led business. So like I have a question -- my first question is why your maps are not updated with current geographical changes? Like I think it's 6, 7 months old, I think, if you talk about the geographical change. And my second question is why your maps are not work through Apple CarPlay or Android Auto? Can you please guide me with this?

Sure. I mean if you look -- if you use Mappls App, it actually fully works with Apple CarPlay and Google Android Auto. Maybe we can take it off-line to discuss what specific issues you are facing. But a fair number of consumers are using our Apple CarPlay and Android Auto-compatible Mappls App and quite liking it. And again, on the map update point, actually, we have the most kind of agile way of updating our maps, we call it real-time rich. And so when a new bridge opens up or a new road opens up or a new place is inaugurated, it is first on MapmyIndia's map. Of course, India is a very vast country. So there could be places here and there, for sure, which are not updated. But the moment we get to know, and we are continuously proactively tracking through all sorts of methods, automated and semi-automated based on our customers' usage and our consumer usage, our own team's data acquisition pipeline, surveys, et cetera, we are able to kind of ingest -- I mean, first, validate then ingest and then publish immediately. So any specific kind of map feedback if you have or if it's related to some specific car, which was an old car of an OEM, which didn't have Internet, the earlier generations, those may be the reasons why you might be seeing old geography generically. But otherwise, if you're using Mappls App, I mean, or our connected automotive solutions that are coming to market or our APIs, you're getting, I mean, the most frequent map updates.

Okay. Okay. And my last question is like, if you talk about the Ola Maps and Google Maps, all these other things, do you think -- is there any pricing pressure on us or in future or maybe like if we talk about -- is it easy to switch your customers to the other companies like Ola Maps or Google Maps? Can you please comment on this? Is it easy to switch?

Yes. I kind of, in my opening remarks, talked about it. See, one side, if a product is really, really bad, the product option for customers, then regardless of the price, customers are not going to take it, right? So that axes one kind of competitor. And the second part is we've been dealing with competition for so long. And competition has been pretty arbitrary with pricing whereas we've kind of stuck close to the customer and price based on what value we give to the customer, and it's been of mutual agreement. So obviously, the response on pricing for the foreign company was not to a new entrant who just came a month ago. I don't think the big tech companies are that agile. It's obviously a response to us. And yet it's not -- it probably doesn't go enough, but that's the best that they could do. And I think we are fairly close to our customers. They are fairly confident and happy to continue working with us. And I think some of these things show -- these pricing activities show a little bit the hand that others believe their products are not actually strong enough that they have to use such drastic pricing as a lever. And the second part is how easy is it to switch. It's not that easy, to be honest, depending on how deeply integrated the solution is in a use case. And so MapmyIndia tends to work with fairly large enterprises or large tech companies who actually have the ability to pay meaningful amounts of money. And the solutions are deeply integrated. This also means, of course, whether it's new customer acquisition mode, we also have to work hard to migrate customers from another map to ours. And that's kind of a B2B enterprise life cycle journey. So is there an immediate threat or even a medium-term, long-term threat to our existing customer base? No. And based on our value of our product and the pricing and the whole value proposition, do we see us getting a meaningful share out of the growth in the market? Answer is yes.

The next question is from the line of Moez Chandani from AMBIT Capital.

My question was more on the partnership that we had with ClarityX. So just wanted to see, have there been any incremental revenues coming in from this partnership already? And also, how do the revenue and profitability sharing agreements work in this partnership?

I think Rohan talked about MapmyIndia is keen to develop its AI-based data analytics and consulting business. Now you brought ClarityX into the picture. The idea of ClarityX is to provide that kind of an activity so that MapmyIndia's business grows. That's the fundamental relationship between MapmyIndia and ClarityX. So the revenue is accrued totally to MapmyIndia and the profits accordingly.

Okay. So all the revenue is accrued directly to MapmyIndia business?

Yes.

All right. Understood. And secondly, on some of the new initiatives that we've talked about earlier, international markets, drones as well as consumers, any update in terms of growth there or any incremental revenue contribution on new projects that we've seen here?

On international, actually, things are building up quite well. We'd say that in the next couple of quarters, you'll hear some serious announcements from us. So I mean I would say stay tuned for that. It's very interesting. We are quite bullish on international. I think we are quite well positioned. On drones, yes, things are very -- going quite well. More and more of our solutions, whether for government or for infrastructure clients, warehousing clients, so public sector, private sector, this whole 3D digital twin mapping is picking up at the fact that we are full-stacked drone solution providers, without even going deeper into design engineering when it comes to drones. So besides the fact that obviously, we have a geospatial platform called mGIS, fully in 3D, our 3D maps, our other kind of abilities or IoT. So it does, I mean -- so it is building up well. Of course, it's the third pillar of our business. It's coming up soon. And so just the way you've seen IoT grow, we are quite bullish about how the drone-based business will grow in the time to come. And finally, on consumers, you are seeing consumer adoption just increasing rapidly, whether from Mappls App or Mappls Gadgets. And there's a whole host of kind of announcements of product enhancements that we'll be talking about it. And so yes, these are what we are -- these are the 3 things that we are doing for the various long-term. We are working hard and passionately and enjoying it, making good things, innovative things, unique things, valuable things for customers and users.

The next question is from the line of Anmol Garg from DAM Capital.

A couple of questions. Firstly, on the last 2 quarters, we are seeing increase in the technical services outsource cost. If you can indicate what this pertains to and what can be the normalized level that we can expect for this expense?

It was -- majority of it was related to the projects for which we have earned revenue, which is shown in the financial statement. So these are, from time to time, depending upon the projects such costs get incurred. We do not want to build that kind of -- by increasing the people within the company because they are project specific. So if you're asking the question, what kind of this cost will happen in the future? It will depend on the nature of the projects that we take -- undertake and try to convert it into revenue.

Sure, sure. Secondly, just a continuation on the Hyundai and Kia contract. So as contract comes in 2Q, can we expect a strong increase in auto revenue going ahead in second quarter? And also, in continuation of that, in this quarter, particularly, so if you include the IoT business as well, then it looks like that the auto business actually grew ex of IoT despite the Hyundai and Kia impact. Is my understanding right over this?

See, I mean, Anmol, like we've said, we are not a quarter-on-quarter business. Look at us annually. It will help everybody understand us better. Obviously, directionally, the fact that Hyundai-Kia has gone live, that will start building up the revenue, and it's a fairly large amount over a period of time. So I don't want to kind of say quarter specific. On the IoT side, as [ Mr. Rama ] explained already, the -- there was a reason why hardware sales was reduced by design. And obviously, that situation has changed now. And so overall, [ P&L ] was still good, considering the ramp-down of various programs in the past. And -- so I don't want to go into specific customers and, because of that, what the specific impact is on revenue because we have a portfolio of customers across that.

The next question is from the line of Abhishek Kumar from JM Financial.

First is on IoT. I just first want to understand, given that the fund approval has come just last week, and that means essentially almost half of Q2 also gone. So are we looking at a softer Q2 also? Or is there kind of a pent-up demand in hardware and we can make up for the lost time in Q2?

Yes. The -- if you are looking -- thinking that is that business lost, answer is no. The business also has -- you can keep it alive. And so going forward, now that the funds issue is not there, you will see the increased hardware sales also happening because as Rohan also pointed out that the more the hardware we sell, the more the SaaS revenue for the future happens. So I don't think there is anything to worry about IoT business growth from the last year where we were at INR 100 crores. You will see the good growth in that in this year, too.

Okay. Second, on the SaaS revenue itself, my understanding was that this kind of sticky on the installed base. So I was a little surprised at the sequential decline from Q4 level of the software revenues. So is it because some of the hardware where we have given a kind of annual subscription were not renewed? And if that's so, if you can just give us a percentage of retention...

That's not exactly true because along with the hardware, also some SaaS revenue happens.

No, I understand that. But if it was INR 18.5 crores last quarter, that must be linked to some hardware, which is already sold. So a decline from that level, I'm just curious...

Okay. So now as I said, part -- some of the hardware -- the hardware, also sales happens in a couple of different ways. One is with the software subscription. The other is without software subscription. So unless -- until one digs into the details, you will not know. In my mind, I don't think it has gone down from the subscription level.

And you should look at it an annual basis, not quarters. I mean quarter-to-quarter, this is not necessarily a quarterly subscription. It could have been that it is an annual subscription also, which might have gotten a [ full lift ] to the Q4.

Okay. Okay, understood. Fine. And one maybe last question. We have -- you keep saying that we should look at it on an annual basis, the revenue. So while we have a 35% to 40% kind of revenue CAGR to achieve our target, every year from now until FY '27, '28, should we look at the growth in that ballpark 30%, 35%? Or it's more like a back-ended kind of revenue that we are looking at to achieve our INR 1,000 crore target?

I mean, it's -- like we said, I mean, look at -- I think I talked about this earlier. You look at the open order book, how it's progressed from INR 700 crores to INR 900 crores to INR 1,300 crores. Fairly predictable that the revenue will grow based on this open order book growth as well. So we have the confidence. We are seeing it again that we will cross this revenue milestone by FY '27, FY '28 of INR 1,000 crores. And business is building up in that. We don't want to give specific guidance on specific dates beyond what we have said, and we have a focus on executing fully, and things are looking good.

The next question is from the line of Nitin Sharma from MC Pro Research.

So firstly, can you please talk about how big is this 3D digital twin project is and how much time will it take you to complete it?

Sorry, Nitin, we couldn't hear the question clearly.

Yes. So can you please talk about how big is this 3D digital twin project is? And how much time will it take you to complete it?

Okay. No, I guess kind of specific customers, we probably can't talk about size, et cetera. I mean that's sometimes a stock exchange requirement because of which we have to do, but on our own we -- if it's not required, we won't talk about individual customers. But yes, project is very interesting. It's to help in kind of modeling flooding in the city, which obviously means that it has to be 3D mapped because you need to see kind of where water builds up and where water can flow out from. A complex project, geospatial project. And 3D mapping of that -- getting a 3D [ discipline ] of that is required, and we have all the capabilities across ground-based or even like inside water-based and, of course, aerial-based capabilities to do that from data acquisition to processing to kind of the platform. So, yes.

Is there a rough time line for this project or any project of a similar nature in your understanding? And just related to it, have you -- based on your conversation, do you think that this whole flood situation is manifesting open opportunity for you from other state governments? Are they looking similar things?

They're huge -- I mean, yes, typically projects, I mean, again, we won't talk about the specifics, but you can imagine a couple of quarters these take. It's not so -- it's not an overnight solution to do all that. But a couple of quarters, years -- and not a couple of years either. These are like -- the type of projects we tend to take, we've always said is things that we can choose, things that we can deliver, things where customers will pay us. We are fairly picky in what we focus on or at least we try to be. And yes, each of our use cases are applicable, and that becomes very interesting. So each of these opens up more opportunities for other cities and other flood-prone areas, and that will be the endeavor to kind of show that we could do it here so we can do it somewhere else. And that's how the business will grow over time.

And if I can squeeze in a small question. So the 40% EBITDA margin guidance [ during the full ] year, is it impact, right?

You're talking about the EBITDA guidance -- EBITDA margin guidance?

Yes, yes. Right, margin guidance.

See, there's like multiple parts to our business, right? You know that's a high-margin business from a MaaS, SaaS, PaaS point of view. But we also want to continuously invest in our products to keep making innovations like -- cutting-edge innovations which are world-class. I mean we are not stopping at just making a good-enough product or a bad product. So we really want to make products that are superb. So -- and we have to invest for that. We want to invest for that. And the other is that we really do believe that one of the things that will unlock growth for us is more people getting to know about us and our solutions. And so we are starting to do that activity. You may have seen recently -- I mean it's not a Q1 topic, but you may have seen recently in the India-Sri Lanka kind of ODI series, we are very prominently placed as a sponsor. And so more people knowing about us will make them curious about what we do and give them trust that we are large enough for them to entrust us with their time and their money and as a consumer or the enterprise. So there's a bunch of investments we want to do in products and marketing to unlock further growth. So EBITDA is an outcome of that also. And so I don't want to kind of say a specific number, just that we have this mind that we are a profitable, growing business, and we're working towards that.

The next question is from the line of [ Vidyadhar Ginde ] from Sohum Asset Managers.

So my first question was regarding the annual report. You have discussed in detail about addressable market size in various areas such as drones as a service, drone solutions, defense, B2C digital maps and services, et cetera, a lot of MEA maps markets and SEA, so -- and given what is the addressable market size improvement slightly increased, slightly up to 2030. So how should we understand this that if this also like I presume -- this will also start contributing to revenue over the next few years and probably will contribute something to your revenue by FY '27 and FY '28 when you are targeting INR 1,000 crores of revenue. So should we expect that we need revenue to come from these new areas to move to INR 1,000 crores? Or if anything comes from these areas, it will be -- it will take your revenue to a level higher than INR 1,000 crores? And would you also, at some stage, give us more clarity just as you have given on your road map to INR 1,000 crores from the areas which you had mentioned? Will you, at some stage, give us a road map of revenues from these areas also so that we have much better clarity on your overall revenue?

Business is ongoing. Product technology and innovation is also ongoing. So when you think like that and a year back, we had given our road map of INR 1,000 crores. We drilled it down that where and how it will happen. Now do we have all the contract orders that will give us that INR 1,000 crore today? The answer definitely is no. But I guess we look at the holistic picture and then say that this is how the big market is there, and within that, we carved out our addressable market. And within that, we mentioned that we would like to achieve INR 1,000 crore. Now that's a very good milestone we have set for ourselves, and we have communicated to every investor. So whether it will come from the new one or whether it will come from the existing one, there's nothing like that. Existing one is only that INR 1,300 crore open order, if you want to think of. But every year, like from INR 699 crores, INR 700 crores to INR 900 crores to INR 1,300 crores we've built up, the team -- business team -- the sales team is building continuously more and more orders every year. So that's how the business is run. I hope you will understand and appreciate that.

No, no, what I'm saying is, for example, the road map, which you gave us of your INR 1,000 crores, certainly did not include B2C digital maps and services, the advertisement -- in-app advertisement as well as going -- or doing MEA -- going to MEA and SEA road maps. And I presume you will do that before FY '27, FY '28. So that was my question. So if you put...

Today, we have no indication for that B2C, advertising or whatever you are calling it. We have not given you that. Now -- and we have not said that we'll be earning revenue from that. If we earn, we'll let you know that what -- that it is happening. As of today, we are not making that statement.

So are you saying that these are unlikely to contribute significantly to revenue in FY '27, FY '28?

I think we've answered the question well. I mean...

Okay. So my second question was on this ClarityX thing. From the answer you give to one of your earlier questions suggests that in this partnership, the entire revenue will go only to MapmyIndia and nothing to ClarityX. Is that correct?

Yes, MapmyIndia is going to generate the revenue from it. MapmyIndia is selling these solutions. See, if you look at it from MapmyIndia's angle, we're a product and platform company, meaning that we are selling our maps, our software, our APIs, et cetera. But at the end of the day, we want to solve customers' problems. And if we, as a company, have our DNA being product and platform, but customers need solutions, and where the customer needs analytics and consulting, this is more bespoke and more professional services. And then there are other expertise also that is required, which are these AI models for analytics, where geospatial data is only one component. There might be other components, too. So these 2 companies together, MapmyIndia and ClarityX, can deliver on a larger set of needs of customers, I mean, in the specific area of AI-driven analytics and consulting. So for MapmyIndia, what it does is it increases our basket of offerings. So we can have a higher wallet share. We can be closer to the strategic planning and monitoring of the customers. It gives us more opportunity to upsell and be engaged, but we don't have to build that delivery capacity around that, for which ClarityX is building that expertise, and we have good strong close collaboration with. So revenue will, of course, accrue to MapmyIndia, and that's kind of what will help grow the business. Let's move to the next question.

Yes, sir. It's from the line of [ Deepak ] from Sundaram Mutual Fund.

Sir, earlier, you made a comment on Ola Maps and that the product quality is not up to the mark. And Google Maps, there is no pricing consistency, okay, and whatever is happening in the mapping space. So can you please explain with a small example, let's say, taking an autocomplete or direction map APIs, what could be the pricing differential between, let's say, Google Maps or Ola Map or you on an API basis? What is the price differential? Post this...

I mean first of all, so I think anybody who's using that map or the products that power that map, I think, first, you should talk to them or try it yourself and then figure out whether it's even worth the time, forget about the money. So I don't want to go into kind of comparing to a product that has no track record and -- just look at -- just search on Google or Twitter on what people are talking about it. I mean it's -- I don't think it merits too much discussion. Now when it comes to Google, which is a serious player in this space, there are customers using them. I think we are much more agile as a company when it comes to providing solutions and providing value. So if it's taken so many years for this big tech company to respond in one way, whether it comes to pricing or even product, I mean I'll just give you that example. We launched 3D junction views. Actually, it's been there in our automotive product for many, many years, actually, starting with BMWs and Hyundais and all of that for like 5, 7, 8 years. But people started to take note of it with Mappls App 2 years ago, as Mappls App became popular. And people just really loved the features. Now we noticed that just in the last month, we announced a feature called flyovers, where it verbally tells you take a flyover. Now India is, first of all, it's not just flyovers. There's not one type of flyover. There are like complex flyovers in India. There are underpasses. There are other complex intersections. So I would say this is a very weak way of solving the very specific needs of Indian customers. I mean if you want to solve it, solve it the way that we give that 3D junction views, where you visually see realistically what that junction is going to look like and which turn you have to take. So I mean we are just much more agile, much more hyperlocal. We understand the nuances of customers. And so pricing-wise also and product-wise also, I think we offer better value. Of course, we'll have to fight it out. It's a competitive market, all of those things, and those are what we are doing. And then there's a whole host of solutioning that we do around maps that these other people are much further back because over 30 years, we've innovated so many solutions that there are so many use cases where they're not even a factor. So it's a small fraction of our business, where we intersect with these players. And even in that small intersection, I think we are fairly well placed, I mean.

The next question is from the line of Amit Chandra from HDFC Securities.

So my question is on the continuation of the competitive intensity that you have mentioned. So in light of the higher competition, how do we see the margins of the Map-led segment? Obviously, you are on the -- we have seen, [ I think, margin over ] 50%. But with the higher investments that you're planning in terms of technology, can we see some contraction there over the longer term? And also in terms of pricing, obviously, the pricing we have, and we have a very high market share in the auto segment. So have you ever seen the OEMs asking for any pricing discount? Or we believe that the pricing that we have is still very low and there is a scope of improvement there?

If you're talking about the auto segment, the auto segment -- auto OEM customers typically go for 4, 5 years of contracts, okay? So now the earlier Hyundai-Kia agreement or contract has ramped down, and the new contract is in place, and the revenue has started this quarter. So it's not that every day we sit down with auto OEM customer for negotiating or not the prices. Now we are always providing, through our NCASE solutions, some upselling. Now if there is an upselling some new features, then we sit down and negotiate additional or addendum, whatever you call it, to that agreement. So that's how the automotive OEM is happening. Now I don't know if you're talking about the pricing for the one Google type of competition versus the new entrant. The new entrant is giving everything for free. So let that happen, let them do it. And any serious user, I doubt, will ever think of using something which doesn't work. Coming to the other one, we have reduced the prices, I don't think we are very concerned about that either because as Rohan said before, that probably they were responding to our pricing, and that's what took them that time. And it's just a matter of coincidence that, same time, the new entrant also talked about it.

And just like the nuance of that pricing is, for small -- this is a headline number, misleading. For small customers, that discount is actually up to 70. For large customers, there's no change. So there's too many -- still marketing versus actual kind of on ground, there's differences. So I mean just like for small developers who have very low propensity to pay very low volume, very low value. And we also have free plans. I'm just -- we are cognizant of it. We are watching it carefully, and we are addressing what has to be addressed.

So is there any clause of any volume-based discounts because now we have the dominant market share? So as the volume increases, is there any chance of any pricing discounts that the OEM cannot [ support ]? We have seen that happening with other players and who was very close with the OEM.

So automotive is a different market, and this API and developer is a different market. I'm sorry, maybe you should have been clear. This pricing that these people have done is to do with API and developer market. It is not a relevant topic in the automotive OEM space.

Ladies and gentlemen, that was the last question for today's conference call. I would now like to hand the conference over to the management for their closing comments.

Well, I would like to thank all the participants and I would like to say with a high level of confidence that we are pretty much on track. And the year FY '25 has started in a nice way. So let's hope that we continue doing a good job in the years -- quarters and years to come. But again, the last -- a small statement that please look at us on a year-to-year basis, and this quarter-to-quarter, will happen through either lumpy or whatever reasons. So that's my request to all of you.

On behalf of Anand Rathi Shares and Stock Brokers, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.