SIS Limited (SIS) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the SIS Conference 2023 event release. This session is being recorded and will be uploaded on our website as well. I'm Shweta Jain, and I'm the AVP for Investor Relations and M&A. Today, in the second session in the series and be able to share with you our strategy across our key business segments and provide you with an opportunity to interact with our leadership team. The first session was on facility management. And today's session is on the Security Solutions India business. And the second presentation after that will be on VProtect business. I would like to add that some elements of our presentation may be forward-looking in nature and therefore must be viewed in relation to the risks pertaining to the business. The safe harbor disclaimer applies to this webcast as well. Before we dive into the India Security presentation, I would like to talk a little bit about the outsourced business services space. This is just to provide you some more clarity on how we perceive this segment. The industry is divided broadly into 4 categories. The base layer or the first layer is the staffing segment, which primarily includes providing human resources per the client requirements and the service provider is not responsible for any outcome, training, et cetera. Here, the margins as expected, are the lowest ranging from 2% to 4%. I'm referring to EBITDA margins. As we move up the value chain, the second category is the services space. This is where we get 80% of our revenues as well for SIS. And companies in this space provide a service. They're responsible for the outcome, the training of the human resources provided, the payroll, et cetera. They typically follow a cost plus service fee model. EBITDA margins range from 5% to 7% for companies operating in this category. As we move further up, to layer 3, which is providing solutions. Here, companies use less of manpower and complement it with the use of technology solutions. Companies have better pricing power with customers and margins typically range in the double-digit range upwards of 11%, 12%, going right up to 15% as well. Customers have a long-term contracts and higher stickiness with companies in this space. As we move further up in the value chain, it's moving on to the route-based solutions. This is similar to something what we do with our cash business, for example, doorstep banking services and cash logistics. All the elements of the services category are included here, plus there is a route-based economy of scale built in. Here, the profits are linked to nonlinear business. Margins can range upwards of 20% as well. So this was just to give you a broad overview on the outsourced business services segment where we typically operate in. I'll now introduce the first speaker for today, Mr. Tapash Chaudhuri. He is an industry veteran with over 3 decades of experience across manufacturing and business services. He joined SIS Group in 2013 and oversees the security business in India. He has worked with Murugappa Group and Hindustan Motors before joining G4S as the CEO, heading their manned guarding and electronic security business. He has extensive experience across customer relations, sales and business development and industrial relations. We also have with us Brajesh Kumar with us on the call today. Brajesh ji is the CFO for SIS India and has been with the company since 2013. Over to you, Tapash ji, for your presentation.

Good morning. So I will give you a presentation on the India Security Solutions business, and it is the fastest-growing security company and the #1 player in this industry. Market opportunities. Market opportunities in security solutions there is no limit actually. And in fact, when we talk about that if we are growing at a higher pace than the industry growth, it can always come because if you have a better sales network and the team. Normally, the percentage growth comes from 3 different silos. One is the country's GDP growth, whatever, 6%, 7%, 8% on that. So the industry infrastructure, everything is improving in that direction. The second silo is the inflationary growth, which comes because this industry is run by the minimum wage notification, which is wages for the guard. So every 6 months, there is a revision of minimum wages. And whenever there is a hike in minimum wages, obviously, the rate goes up, and this is called inflationary growth, which is 3%, 4% normally in the sector. And the third 1 is the biggest silo, which comes through the churning of the security opportunities. And you gain that particular business over your competitors, and it is unlimited. So if SIS grows at a much higher speed, much higher pace than the market growth, obviously, the major contribution comes from the market share churning, and that's how you improve your share. The next 1 is the electronic security, which SIS is venturing into that. And then this particular planning came 4, 5 years back, that ultimately, at the end of the day, it is the security solution, which will take you through -- and the solution industry, the electronic security companies, these are also growing -- this market is also growing almost about 3%, 4%, 3, 4x in this particular next 4, 5 years. SIS has got this particular processes and technology scenario, and then we have like mobile training van, we have our internal monitoring system through SalesMax, the effort adjustments and then the iOPS we have, which is an intelligent way of monitoring operation, and then we have the SaaS-based software solution products. Next, this is how the fastest-growing security solution brand in India is SIS, security and allied services, the electronic security solutions. And these are the 5 companies, which comes under India solution -- security solution. One is the SIS India, which is the main company, and then we acquired 3, 4 years back, SLV and Uniq. These were another 2 guarding companies, SLV is primarily in North India and Uniq is primarily in South. And then besides that, we have Tech SIS, which is our own technology solutions company and then VProtect is the addition in allied monitoring and the response services for which Shankar will give a presentation today. We have our this -- INR 3,412 crores. This is the 3 quarters reported revenue number, which is ending 31st December, and 181,000 plus permanent employees. We have around 17,000-plus sites and then customer retention. This is another good thing that customer retention is 94% and we have about 6,500 plus customers in India. This is SIS spread. We have 182 branches, all 36 states and union territories we have present. We have our presence in 630-plus districts through the 25 regional offices, and we have 22 training academies also in the country. Next, Services and solutions offering. One is that security and allied services where we have products like static guarding, we have patrol guarding, we have escort services. We have event management. We also provide personal security officers and then the fire and safety combat. And we also have the dog handler services. These are the primarily -- all different security services, physical guarding products. Besides that, we have technology, electronic security products, we have access control and artificial intelligence-based AI solutions. We have fire safety. We have the other SaaS-based products. So anything and everything related to security solution can be provided by us because SIS is primarily integrated in this particular sector. It is not only a mere product supplier. So we can have -- give a comprehensive range of services and solutions. Next. We are leveraging technology to improve productivity and operational efficiency. The latest addition in this particular slide, you can see that MySIS, which is a facial recognition-based attendance mobile app. This is an auto attendance system through the mobile. Every guard will put their attendance here. It was a long-awaited demand in this particular industry. And we have launched it and then this is more or less through. And in fact, all wages, it is coming from this automatic capturing of their attendance. The second addition is this QAACA, which is quality assurance and compliance assurance that dashboard also will be provided to most of the customers. And then we will monitor this particular quality and assurance and compliance assurance movements through that. We had introduced ARK about 5, 6 years back. That was the automatic recruitment kiosk just to -- with an idea that we will recruit a better quality of people, which has been successfully implemented. SalesMax is a tool, internal monitoring tool for the sales guys. Their effort and then their productivity analysis on that. iOPS is an intelligent way of controlling operation, which is there in all the 600-plus operational staff throughout the country. And Digital training platform is AimTrainer, which is mobile training van was introduced by us, all regions and branches. They are covered through the mobile training van, and we have about 100-plus audiovisual training modules, which is actually given on site to all the guards who are deployed in different places. Next. This is a recruitment and trading, R&T slide, we have 22 residential training academics. This is again and Uniq U.S. before SIS. And this particular 22 training academies deliver roughly around 25,000-plus trained manpower. And we provide training for about a month, 28 days to be precise for each and every guy -- buyers and then before they are sent to the branches for further deployment. Next. Now this is a conventional security services journey from physical guarding to ManTech. In case of physical guarding, they are -- the cost -- physical guarding, the cost is higher because of improving -- increasing the wages and the technology intervention is very limited. And obviously, the satisfaction level is also limited. When you get into the ManTech scenario, then cost goes up because of reducing prices of systems, electronic security products. And the technology intervention is the -- is higher. It is much more than the physical guarding and obviously, the satisfaction level and the output is far better. Next. These are the future growth segments. We have -- when we have the electronic security software, the integrated security coverage and then there are different products CCTV surveillance, entry, automation, everything. And we have our partners [indiscernible] vision and then LG, [indiscernible] all these people. And then besides that, whoever is not reflected in this particular slide, if there is a requirement for any integrated security solution, we are open to tie up with them because we are an established integrator. Next. We have a pricing model. This is a typical style of pricing model in guarding industry, they go as per the cost-plus model and minimum wages are there, so which is the wage portion, the direct cost plus the statutory part, which is PF, ESI, bonus, gratuity and all these things. So all put together comes to the direct cost. And over and above, there is a supervision charges and then management fees. So based on that, the pricing takes place. In case of ManTech Solutions, we go through 2 different models, one is OpEx model where the rentals are charged on a monthly basis, and we invest on those particular systems. And the other 1 is CapEx model where we give the quotation and offer and the customers, they buy the products from the market or through SIS. And SaaS-based software solution is the other solution where it comes at manual and in the digital solution on that. Next. This is 1 typical case study, see for the last 3, 4 years when we invented or decided to get into the ManTech solutions. So the first thing was oil and gas sector. We provided entire solutions to GAIL, Gas Authority of India Limited, followed by IGL Indraprastha Gas and primarily their issues were that they had huge pipeline from where this particular crude oil was coming and then it was not guided properly. There were risk of fire, there were risk of other gas leakage and SIS have given this particular comprehensive offer for security solution and where the control room were established, the cameras were fitted, the patrollers were there and then even the bike patrollers were also there to go around. So this is an established service which was developed and then it is on ground, satisfactorily working. Next. We have also introduced this OYC and CSAT concept. OYC is that customer -- Own Your Customer and CSAT is customer satisfaction. All our senior leadership and the branch managers, they go around to all the customers to keep in touch and improve the customer relationship management. We also do the market survey for that and every quarter. The last quarter, it was around 8.6 as a score out of 10. So that means roughly over 86% customers are satisfied on the services of SIS. This gives you an opportunity to improve also. And the customer segments, these are the rough pie of whatever is current business of SIS and then we have 23% of our revenue coming from steel and metal and mining sector, IT, BPO and banking and financial sector. So they contribute roughly around 22%. And auto manufacturing plus the other logistics and transportation is another prime contribution of 19% to our particular kitty. Construction cement is the next 15%. And besides that, even health care, pharma, where there is a continuous growth, we are at 9% at this stage. And then other products, 4%, 4% and then others are also 4%. So it is basically the security solution that SIS is spread out across the industries and everywhere, there is a requirement. Next. This is our humble beginning. Indian multinational SIS, starting from 1974 and different process, and they have gone through. The major breakthrough, which came in 2008 when this particular Australian company was acquired, Chubb and from then onwards, the style and the movement and the numbers, everything has started going up very fast. Last 1 was the IPO, which came in 2017. And then after that, this particular journey, the detail is available in this. Here is the -- some of the numbers, the growth for the last few years. Last year -- the second year of this particular COVID, basically, we grew at a rate of 11% roughly. And then this year also, it is okay. I will not say it's substantially very high, but then you see that last 3 quarters -- reported quarters Q1 '23, Q2 and then Q3. So there, the numbers are going up. In terms of EBITDA, of course, there was a drop in the previous year. But then this year, the quarters, the trend is positive, quarter-on-quarter basis, it is going up. Employee headcount also increasing and the retention level, as I told that it's quite okay. Next. These are PR positioning, the competitors. And here, you see that SIS is the continuous growth compared to the earlier years also, whereas most of the peers, their growth is actually going down. So this gives us an additional opportunity to establish and to sell our products and improve our market share in the same organized sector. You know that SIS is #1 in this particular industry. We have a national reach and all 630-plus districts we are present, we have 6,500 customer base. And we have focused on digital transformation, which we started with this particular ManTech intervention unlike many other leading guarding companies. And we have trained security professionals. We are the largest training institute -- training sectors in infrastructure in this particular country and stickiness of the customers consistent delivery, 94% retention. So that's all the presentation from India Security Solution. We will interact with you in that Q&A session starts after Shankar's presentation. Thank you.

Thank you, Tapash ji. Thank you for the insightful presentation. I would now like to introduce our second speaker for today, Shankar Subramanian. Shankar has over 25 years of experience in sales, marketing, business development across the consumer durables, IT, engineering, FMCG and Business Services segment. He's joined SIS in 2015 as the President for setting up and driving growth from the Alarm business in India. And currently, as the COO, he is responsible for driving the technology business for SIS Security and also looks after marketing initiatives for SIS Group. Prior to SIS, Shankar was part of brands like Blue Star, Samsung, Wenku, Ingersoll-Rand at leadership level. Over to you, Shankar.

Thank you, Shweta. A very good afternoon, ladies and gentlemen. Thanks for giving us this opportunity to talk about our business to explain what we do in VProtect. VProtect is the fastest growing and leading e-surveillance company in India. We have developed an alarm monitoring and response solution that is -- that integrates technology and leverages human resources to offer a unique offering that is smart, user-friendly and dependable and affordable. So it's basically a fundamental principle for why VProtect business was introduced way back in 2016. We started in the year 2016, 2017 is the year, 2016, '17 is a year when we were planning out this business. And the purpose of this business was basically to look at the human resource are not going to be affordable over a period of time. And in that given situation, how we can optimize the security spend by integrating humid resource technology without compromising on the security aspect. Unfortunately, we had 2 difficult years due to COVID, which has changed the overall outlook of how we look at ourselves, our premises and our surrounding. The COVID has changed the way people live. It has become from a we society to more like I, myself and my family kind of environment. Even from an organization point of view, we have gone away. We have started looking at things which can be operated on a remote environment without hampering the operational part of it. So these changes have also, I would say, translated into looking at security in a new form. So that is what is VProtect is all about. Now what do we do in VProtect? So VProtect promises that we will operate 24/7 monitoring. It's an alert-based monitoring platform. We verify 100% of the alerts which are generated through our monitoring platform. We have a very strong civic coordination, and we have a very robust response mechanism. This is what we offer to the customer. What does consumer benefit from that? It gets a response-ready kind of environment, safeguard your privacy without compromising on the security part of it, eliminate the scenario of false alarms because 100% of the alerts are verified through our monitoring platform. We have a very robust, very close civic coordination with, I would say, police and fire and also on the medical ground. And we say that VProtect is not a post-event kind of scenario. It is a preventive security solution. So our basic tagline is how we prevent an event occurring in our premises is our whole motto. The kind of alerts or kind of threats, which we work upon is basically intrusion safety, fire safety, emergency, elderly care, burglary, panic, medical, civicalizing and theft protection. The overall security is not restricted only to intrusion, theft, burglary. It has got a much wider meaning. In today's context, anything which requires immediate attention or an immediate response or something to provide support system at the instant level, that is what is security in today's environment. That is the reason it covers beyond intrusion, theft and burglary, it also covers medical, fire, panic or any emergency kind of scenario. Can we go to the next slide, please. Yes. This is 1 of the backbone for our offering. We operate on a global platform called Mastermind. Mastermind is a UPC platform and considered to be 1 of the most advanced platform worldwide for alarm monitoring and response services. We are the only company in India, which has got this platform installed. There's only 1 installation of Mastermind in India, that is ours. It gives a lot of flexibility in terms of customizing the SLA, SOP for the customer based on the customer requirement and the site requirement. It is completely an event, an alert-based platform. It operates on completely an AI methodology integrated onto the platform. So it gives you a lot of functionality, and we already have -- the capacity we currently have is about close to 0.5 million sites and we monitor from our command center. That makes us 1 of the largest command center in India. The 4-step response mechanism, very important for our business again. There's alert, verify, action response. Every alert is communicated to the customer within 60 seconds. Every alert is verified and action taken in the next 180 seconds. That is responding to our response officer and also through civic coordination. We are the only player in the country to offer response service on a pan-India basis. That is the beauty of this whole solution what we are trying to build on. Now the pertinent question is why we protect because India typically has 2 kind of service outlook -- service -- security service outlook? One is physical guarding, which is a very integral part and very critical component in our security industry as Tapash has just now explained the complete details of it. Another is basically the CCTV solution. In B2B, there's an intrusion alarm system, which adds more value to the whole solution. So that is what VProtect is coming to bring into the table. So what are we talking about? We have compared physical guarding with CCTV, with VProtect, where we see that VProtect is an ideal combination of 50-50 kind of scenario. It's a combination of technology and manpower to optimize efficiency and effectiveness of the solution. That is first part. Second, it cannot influence any behavior, which is typically in case of a physical scenario. Privacy is a concern in both the cases, whereas in VProtect, there is 0 concern about privacy. That is the reason worldwide, this is 1 of the most different solution over a physical or a CCTV kind of solution. It's very comprehensive in nature, it is not just monitoring or it is not just response. It is basically monitoring and response. It's a comprehensive solution. Cost of ownership is much, much, much lower than physical deployment or a CCTV solution. Operationally, operational cultures are practically nil. The reason being it operates on an event and alert-based platform, which essentially preempt any defect into your operation, which can be rectified within the set SLA. Trained response service, yes, the response team at the ground level is all trained for providing an emergency response service, which is not only into intrusion, theft and burglary, but they are also trained for fire and paramedics. Service uptime since it's a technology-based solution and constantly works on invent an alert, the uptime is as high as 99%. Resource deployment, yes, there are trained response for multiple occasions. So in case of a fiscal deployment, you will have restriction in a number of people deployed. In case of CCTV, it is self-managed. I have to manage my own response, looking at my camera, which is at times doesn't make practically a viable solution, whereas VProtect is basically an ideal combination of monitoring and response in this particular case. Next slide, please. Next slide. Hello. Yes. e-surveillance solution. We are talking about the fourth generation of security solutions. So there are 3 generations of security solutions. The first one, which was the initial phase was basically the physical guarding solution where people were physically deployed. The second generation was physical guarding was supported by a CCTV kind of solution. That is the second level -- second generation of security, which was evolved. The third generation was basically some wired sensors connecting to the command center, along with the physical and CCTV kind of -- physical guarding and CCTV kind of solution. That is a third generation. We are talking about the fourth generation. What is this fourth generation that all about? We are talking about intelligent products. IoT-based intelligent products, which is wireless technology that reduces the complication of having a wired system placed at various places. So that is the first level. The second level is we are talking about an AI-based monitoring platform. The monitoring platform, which is self-diagnostic in nature, and it is more -- it preempts the necessitate action, which is required for any alert, which is getting generated. That is more of a monitoring platform. And the third is the most important pillar of this fourth-generation security solution that is a response services on an iOPS platform. This iOPS -- this response services is a shared response service, but managed and continuously monitored on a technology platform called iOPS, which Tapash has explained in this previous slide. Now, what is VProtect business model? Very simple. We have 2 different type of line of businesses to attract. The first 1 is B2C. That is the residential segment. Now in residential segment, we clearly operate on a CapEx plus an OpEx model. The customer buys the product, install it at the premises and it takes services on a monthly basis. This business model is exactly replica of a DTH business model where the KPIs are also exactly same like ARPU, customer acquisition costs, customer marketing cost, customer, it's a sales cost and also you talk about the churn rate, et cetera, that is exactly similar to the DTH business model. The another business model, which we have evolved into the Indian scenario is basically the B2B segment, which is, I think, 1 of the fastest growing segment for us today where we are operating the entire solution on an OpEx model with a 5 years contract -- with a 5-year contract with all the customers where the equipment is leased. The installation testing commissioning is completely on our scope. The AMC is on our scope, the monitoring services is on our scope and also we provide shared response services basically to optimize the productivity of our people who are deployed on a pan-India basis. So all these put together becomes a very solid proposition for a B2B kind of scenario. Yes. Now e-surveillance as a subject is looked at very differently in the Indian context with respect to context, which is then a developed country. So e-surveillance is not just about monitoring through cameras. That is not e-surveillance. E-surveillance is a subject in itself, which talks about the process, the SLAs, the concept, the SOPs, which are being maintained and the platform on which to operate, 1, it comprises not only about intrusion alarm system in CCTV, but it is also about energy management, emergency response services, cluster management, these are some of the very critical component for an e-surveillance kind of scenario, which actually builds value on the security platform. So that is the beauty of this particular solution. And what is the other important criteria is basically your network management because we don't share any network with the customer data management because -- we don't pull any data, but data is maintained at the site. But even that maintaining data at the site and retrieving data has got certain process to be in place. Then we are talking about central monitoring station, which is on a Mastermind platform. And we are talking about business continuity, which is the most important element for any e-surveillance organization. We have a proper DR in place in different zone on an active-active mode to ensure that we provide 99% uptime for our customers. IOPS is basically what you call emergency response operation team -- operational platform where every customer is tagged with the geo location, and it is also shared with the response team. So as they move from point A to point B or from -- to their response location, it is completely mapped, tracked and also shared with the customer. You can plan your daily beat patrol through this process. You can also do some daily checks through the process. So it gives you a centralized dashboard for the customer to look at how the efficiency of our security services has been maintained and how we can enhance it for this future requirement. These are some of the very important certification we do. There are 2 certificate, ISO certification for our entire facility, plus we also get our entire process audited through a certain certified auditor for our database management and also from a network management. These 2 are very, very critical because it ensures that we have a very seamless process, which is reliable and which -- where there is very limited scope for any event to occur at our end. So these are the 2 critical certifications which we follow, maintain practice on a yearly basis. And we give it as part of a compliance document to our customers as well. Very interesting are study, ATMs with AI monitoring, ATM with AI monitoring. So ATM is on promises, which we have started targeting about a year back. And fairly, we have got good response in that particular case. ATM is basically at 150 square feet of premises. We're putting man guarding at 2 shifts or 3 shifts is definitely not viable. Can we go to the next slide, please? So this is the case study. The problem statement is ATM is very vulnerable site and an easy target for any security threat. This is the biggest challenge because they are present in Tier 1, Tier 2, Tier 3 across locations where physical manning is an extremely difficult proposition. Deployment of guards -- physical guards for a 150 square feet space is not a commercially viable solution because that space -- his salaried component will be more than the rental of many of the places. So considering the fact, it does not make sense to deploy manpower for 150 square feet for a 2 or 3 hour -- for a two shift or a three shift during the day. The third is the spend of ATM is across Tier 1, or 2 cities. Putting a physical resource does not give you a consistency in service delivery because you will have different kind of people located at different scenarios where the service delivery will not be consistent and there can be an issue with respect to the compliance as well. What is the solution that we are offering. We are talking about completely motion-based and impact-based sensor to be operational at site. Any movement or any impact to the machine, to the premises to that -- within that particular defined area of 150 square feet will generate an alert "poor command center." We also talk about deployment of AI-enabled camera, which basically generates alert on a behavioral pattern. Somebody's wearing a helmet, somebody's loitering inside ATM. Somebody is loitering for more than 5 minutes inside an ATM area, somebody is trying to remove something from the ATM. All these alerts can be generated through our camera itself. Monitoring of IT resources, monitoring of their power backup solution, monitoring of [indiscernible] areas, et cetera, can also -- is also be part of the ATM solutions what we are talking about. Centralized control for operating your AC and UPS very, very critical during winter time, you can have a substantial saving. If you are able to centrally operate your AC. Similarly, during summer time, you can also control the temperature, what has to be maintained inside. That gives a substantial saving in terms of energy management. Response is shared security services, basically for the deployment, all the sites have been tied to a response officer for any emergency response for that particular site. And he also do -- he also does a mandatory checklist of the site as to whether the doors are okay, the glass is broken anywhere, the AC is functioning fine. We also [indiscernible]...

Sorry to interrupt you in the middle. Would it be possible to adjust your audio a little bit? The audience requested. The audio is not very clear at your end.

Is it clear, now? Is it okay?

Yes, I think it's okay.

The response -- Where do I -- do I need to do this slide again? Or can I continue with this?

I think you can continue.

Okay. Okay. So the shared e-security services is basically no permanent deployment of resources at site, but it gives a lot of flexibility to deploy people on an emergency basis if the event has been seen. So what is the benefit of all this? One, you get a consistency of service because technology does not operate differently depending upon the size, depending upon the place. So it will give a very consistent output, whether it's Tier 1, Tier 2, the Tier 4 kind of scenario. That's the first one. Second, the uptime has been considerably improved. You get about 90% uptime because most of the alerts are generated real-time basis, which requires immediate attention and they are able to rectify. One of the biggest advantage is more the uptime of your ATM better is the revenue realization for the ATM companies. So that is another important thing what people are working upon. The third most important thing is there is approximate, I would say a ballpark figure, a saving of about 75% to 80% over a physical guard deployment. This makes it commercially 1 of the most viable solution for a scenario like an ATM kind of business. So that is something what we are currently deploying. We have deployed about more than 10,000 plus ATMs so far. Currently, we have about 14,000, we closed FY '23 with 14,000-plus connection, and we have a good pipeline to get covered in FY '24 as well. Can we go to the next slide. Future road map. What we intend to do in the future? Okay. We are looking at 2 very solid product proposition to be introduced into the market. The first 1 is Gosecure. If you look at it, all our existing VProtect services are confined to a space -- an enclosed space. It can be an ATM. It can be an office. It can be a warehouse. It can be a retail. It can be a house, it can be a bungalow, it can be apartment, but it has to be in a confined space where the boundary is defined using various sensors. Gosecure is the first product, which will provide security on the go for people who is on the move or to a scenario like an elderly care. I'll explain it on the next slide. The second product that we are looking at is AI-enabled cameras. Now camera is typically a passive device. It just records. It does not do anything other than recording. What -- and the AI component, which [indiscernible] have been introduced into the cameras, the efficiency levels are relatively low. It gets a lot of false alarms, et cetera, et cetera. So what we are trying to do is basically make this camera smarter using our technology platform -- on an Edge platform, we are trying to create an AI algorithm where we are trying to build use cases and generate instant alert at our command center. So this product, which was basically a passive product, today, it's an active product and start generating alerts on a real-time basis, making it more efficient and effective in the current scenario. Now, this is the Gosecure which we are talking about. This is a product, which is security on the go, live tracking of the place, coordinate with civic authorities, can generate instant alert if somebody has fallen down or somebody is not mobile for a particular period of time, somebody has not shifted from a place to another from an elderly care kind of scenario. All this creates an alert automatically, but it can be created on the go as well. So it does not require premises generate an alert. We are targeting this for all the female employees working for BPOs, KPOs and those kind of organization. We are looking at elderly people who require emergency services and old-age homes, et cetera, we are working on this particular segment for this particular category. Next slide, please. AI-enabled camera, there are multiple use cases, which we have built, which has got multiple applications not only in retail or a warehouse or an office or a bank or an ATM or -- so we are trying to keep on building these use cases, and we are trying to see how we can make all cameras more effective by making them active rather than a passive device. So this is something which we are planning to introduce in a much bigger way than what we are currently doing. Next slide, please. Customer segment, we have PSU bank as a customer segment, private bank as a customer segment, NBFCs, logistics and E-com, largest is PSU bank with 37%, private bank was 34%, NBFC with 18, logistic with 3, and B2C with 8. So I said currently, FY '23, we are at about 14,000-plus connections. FY '24, we target to reach about 25,000-plus connections. That is our target. That's our aim and our desire to reach. We have a strong pipeline of about 7,000 plus sites already in hand. So I think the target to meet 25,000 is very much possible. Apart from that, we have a very broad macro-level target also in the next 3 to 4 years, how to reach 100,000 connections into the Indian market, where we see a huge potential getting built up where the cost optimization and efficiency and effectiveness, both are looked as a parameter to be considered. Can we go to the next slide, please? Yes. Customer sites, we have been consistently growing for the last 5 years at a CAGR of 88%, 100% customer has been retained for the last 5 years. We have not seen any churn so far. But of course, I understand the period is too short, maybe another 3 to 4 years, we'll try to understand the customer-consumer behavior better than what we are currently facing. Of course, we have a very healthy pipeline to reach FY '24 targets of 25,000-odd connections in place. Next slide. This is the total allowance. This is 1 of the -- there's a global KPI on which we measure ourselves. Globally the KPIs. You need to access an alarm in 60 seconds and you had to dispose of an alarm in 180 seconds. We are strictly following, maintaining those kind of standards into the Indian market. We currently operate at 58 seconds and 179 seconds. The standards are maintained and part of SLA with all our customers. Currently, we have about close to 130-plus monitoring employees at our command center to operate all our sites. They are operating in 3 shifts. Yes, number of alarms handled is phenomenally huge. But the beauty of Mastermind platform is 99% of the alert can be managed and can be closed from remote monitoring itself. You don't have to physically deploy person, send a person to handle that alarm. So that's the beauty of this whole platform. Less than 1% of the alarms required physical intervention for which we have an emergency response services already in place. Leadership position. Yes, we are looking at optimizing on manpower deployment. That is the first part, technology, which is relevant for today and for future as well. That is something what we constantly look at it. Most importantly, we look at it, it should be easy to install, manage and operate because this will make the system more user-friendly. It will be more acceptable to the larger audience of the people and it will get you a larger benefit over a period of time. Inspection, intervention investigation is the 3i approach what we follow. Financially a very stable organization. Customized SLA and SOP is the key aspect of what we try to build in our business. One of the most important things here I would like to add is currently, as VProtect, we are operating our EBITDA margin at about 15% to 20%. And we believe -- strongly, we believe that as today, we may not be a very important pie in the overall SIS revenue model. But as we grow from this year, we have clocked at about INR 65 crores. So next year, we are targeting about INR 100 crores. So like this if we start growing and reach a significant number we believe that it will have a significant impact on the overall margins for the SIS Group Enterprise. That is something what we are looking at it for the next 3 to 4 years down the line. Next slide, please. Thank you, and I'm open for all the questions which can come up now.

Thank you, Shankar. I think that was a wonderful presentation. I'm sure the participants also found it equally engaging and insight to learn more about VProtect. Thank you, everybody, for attending this. We now open the floor for Q&A. And as we start to receive questions both on the chat as well as you can raise your hand as well, and we unmute your line and allow you to ask your question. I think we've already received a question on the chat from Devraj, why don't you go ahead and ask your question.

Sir, I just want to know that you our company has done buyback also, and we have got cash balance. So minority investors, right? How can we be assured that this much amount is there in our books first thing? And second, sir, what is the non-core diversification if any, from the promoters plans? This is my first question.

May I ask you to introduce yourself as well, Devraj?

Yes. I'm an individual investor, and I do research also for investors, and we are invested in SIS Limited.

Sure. May I request Brajesh ji to take that question?

Your first question was on buyback. And second question was, how we manage investor-operated against a non-core investment. So I'll first take up the second one. There's no non-core investment wherever SIS investing, keeping in mind the future of security market. There is no other plan to diversify our portfolio in any other area. Of course, there is some investment when you try to develop security solution business. But there, we feel that ultimately, it will give a good return in future. First question on buyback. I can only say that there are some expectation from investor also, which we have to meet. We completely see what is some proportion of the company, how much it can afford to pay out in form of buyback. And keeping that in mind only we take a decision of buyback, and that is being put before the board and our board members are -- all the professional people are there. They assess everything, and then they give the approval for that, and then we'll go to the market for a buyback. I hope I clarify your question.

Okay. And sir, 1 more question. Sir, [Foreign Language] subsidiaries, they all are audited, right?

Yes, 100%. That is the requirement. We are listed companies. Without audit we cannot manage.

Okay. And sir, just a professional management and promoters [Foreign Language]?

Yes, but board of directors consists of the people, if you go through the list of those directors, many of them are fully professional coming from professional background. So that is how we run the company. And all the businesses are added by the professional SBU like in security, Tapash, Shankar, there are some other people similarly for other group company also all the business are headed by the professionals who take care of day-to-day operation, take all the decision on this. Only when there is any large decision which will impact the future of the company, then it comes to the Board, and that's how we manage.

I request the participants to restrict your questions to 2 per participant. You can join back in the queue once we have addressed some of the other questions as well. I'd now like to call Kunal, you can go ahead and ask your question.

Thanks. And this is Kunal Thanvi from Banyan Tree Advisors. We are a SEBI registered PMS firm. So I had 2 questions. One was on overall security services business. I wanted to understand when we look at Security Services business, we see a lot of working capital investment in this business. Can you help us understand how does -- why a security service business would require 90 to 100 days of working capital? Because what we understand is we have to pay our salary in advance and we receive money in a lag. Can you help us understand different industries, what kind of working cap cycles are there? Secondly, in terms of -- as you said, the second lever for growth is, of course, the price hikes or the wage hikes. Can you help us understand what is the lag between the real wage hike that we do for our employees and how much time does it take to get reflected in our contracts with our customers? And how these contracts are kind of structured to make sure there's a smooth transition of the wage hike? These are 2 questions if required, I'll get back in the queue.

Thank you. I'd request Brajesh ji to take that, and maybe Tapash ji can also add to that.

So First question on working capital, our DSO is not in the range of 90 to 100 days. It is in the range of sub 70 to 75 days. And we believe that it is in line with the current industry standard sometimes temporarily for one of the quarter, you might see that there is some increase in DSO, but we have been managed to bring it down to an acceptable level. And that's working capital is required because you're correct that once we raise the advice to customer, we have to agree a great time with the customer at the same time, we need to be ensured that all the wage payout, all the salary payout has to done in time, for that, you need money. So whatever salary we are making payment for whatever PF, ESI, GST, we are making me, that we have to pay from our side, and then we collect that money from the customer. So that is the reason why working capital is required industry. There is no CapEx involvement at least to any significant number. While wherever it is, it is very minimum amount. And it's only for the salary, PF, ESI and gratuity and other steep part for which we have to manage from our side before we get that collected from the customer.

Sure. And this is same for all the sectors or the segments that we are present, like 70, 75 days the usual norm for all the sectors or segments or there will be some sectors where you'll be receiving a bit faster?

It is general trends and some -- there can be some difference, but not that much. Small businesses, we managed to collect very soon, but the DSO, the large part of our revenue is coming from the large business. So it is almost the same from all the sectors.

Just like to add there, although in the cash segment, that might look slightly different. And as you may know that cash as cash is a JV. It's not really consolidated into our books. But yes, the DSOs there looks slightly different than what they would look for the rest of the group.

On the second part about the wage hike due to the rate increase and minimum wage, yes, this is very much a part of our agreement. This clause is very much there that whenever they need change of not only minimum wage, if there will be any change on other act like PF, ESI, it's completely pass on. Because the customer is a principal employer. It is their responsibility to ensure that every -- the person employed at their location are getting paid all the [indiscernible] meeting as per the current building block. So there can be some time lag in getting the billing rate revised, but we have to comply with the payout side as per the changes happening in the minimum wage. So that is obvious. Almost all the contracts have this clause -- mandatory clause, that depend upon there is any change, the customer is obliged to give us that change, and it's 100% pass-through.

Sure. And just a follow-up on that. At this point of time, like last time when we had interacted we were -- the entire industry was in the process of taking new wage hikes state-wise. What is the situation at this point of time? How many states have taken price -- wage hikes after COVID and what are the states that are still not taking it and they will take in, say, next 1 or 2 years?

So yes, during COVID period, the minimum wage rate revision was not happening. But since last year, we have seen that most of the states have come out with the revision of rates. Some of them were in the range of 5% to 6%. States like Karnataka, there was increase of approximately 18% to 20%. So I don't have the list readily available, where I can tell that which state has done how much. If you want, we can share that also. But compared to last 2 years, the 1 component which has helped us in achieving this growth is also the minimum wage revision, which has taken place by all -- by most of the state governments, also the state government. Some of the locations wages are being paid as per the state government regulation. So there also, in last year, I think 2 or 3 rate revision has taken place in case of central government establishments.

Thank you, Kunal for the question. I'd like to request Sriram. Please unmute yourself, go ahead and introduce yourself and ask your question.

I'm an individual investor. I have a couple of questions. So basically, I mean, have we thought about demerging the international security services business? Because that's a large part, and obviously, the growth rates are different, right, between the FMS and the India Security International Services is obviously expected to grow at a slower pace and that is also giving rise to a lot of international entities because your corporate structure is a bit complex with entities located in British Virgin Islands and so on. So I mean that is -- from the minority shareholders' perspective, that's some sort of a gray area. That's what I see. So what are your thoughts on that?

Brajesh ji if you could address that. And for participants, I'd just like to share that since this session is on the India Security segment, we really request you if you could restrict your questions to this segment. But yes, obviously, we'll address this. Brajesh ji would you like to address this?

I would say that Devesh Desai, Group CFO, who looks after international business will be the right person to address this. But 1 thing I can clarify that we have -- whatever entity we have in British Islands and something that [indiscernible]. Now we are -- the structure is such that it is being managed -- SPV is managed through Singapore and for that -- further detail if you want and please excuse me for that, Devesh Desai will be the better person to explain all this thing.

I'd like to now request Chirag. Chirag hope you are doing well. Please go ahead and ask your question.

Sir, 2 questions I have. If I can squeeze 1 more later, I'll try to. So first, on this VProtect or ManTech, this kind of product that you're offering any cannibalization risk that you see with your existing? And if yes, what is the incremental value increase that you see in that and it's more than compensates for that. So how do you look at this as a space?

May I request Shankar to take this?

Thanks, Chirag. Very pertinent question, I would say that, given a scenario where we are operating both physical guarding and also technology solution. Here, we look at technology solution actually taking help from the existing man guarding solution for providing response services. We don't cannibalize the sales. But yes, there are a certain segment which is moving away from this physical guarding scenario like the ATM segment, where I explained that it is financially not viable, commercially not viable to deploy a guard on 3 shifts. In that case, we are definitely not losing that space, I would say. We are still maintaining our leadership position in that space and also taking help from the SIS physical guarding on leveraging their spread on a pan-India basis to help us with the response services for the customers. So it's actually optimizing the existing solution, which is deployed at both end technology as well as the physical guarding kind of scenario.

Yes. That's from your side of perspective. But when I look at SIS as a conglomerate, on net basis, how the SIS benefit? I'm trying because if you ramp up from the INR 65 crores to INR 100 crore and maybe say, INR 500 crores a period of time, on net basis, what is the incremental addition that could happen to SIS? This is just a hypothetical number, I'm not indicating anything.

So the addition will happen into account. One, 1 of the most important addition will be in terms of the EBITDA margin because as compared to physical guarding, we operate at 15% to 20% EBITDA margin. So that's a substantial gain, which can come or which can pull into the overall SIS Group margin structure. So that is 1 critical area where it will play an important role. The second role is basically, today, a physical guarding is doing 1 particular job of guarding a premises. Can I use the same resource and do multiple jobs is something that we are exploring and that is what we have been successful so far. So we definitely see the same resource contributing higher revenue, considering both the businesses running parlay to deliver that objective. And third here, 1 more point I would like to add, customers are also looking at optimizing their security spend or improving the efficiency using technology. Now if we, as a security provider -- physical security provider, are also able to provide technology solution. Actually, it becomes an icing on the care for the customer because they can deal with the same organization for both technology as well as physical guarding, which will come under 1 common head. So there is a win-win situation for both consumer as well as for the company.

And if I can just squeeze in 1 last question and probably slightly broadened. So the physical guarding those employees or those people who get free, are they redeployable for something else or that is another challenge because you need a different kind of skill set in this environment, right? What the country is transitioning to? It's not just our business model, but the need of the RMC, so how do you handle that part of the challenge? And probably it's not linked necessarily your part of business, but again, it's more from SIS perspective, I am asking.

So in fact, we have 1 of the -- as Tapash ji has brought it very clearly in his presentation, we have a very robust training setup environment in our organization. So we are the 1 who continuously keep upgrading the manpower training part as per the business requirement. Prior to COVID, a guard was supposed to perform a certain type of task, post-COVID he is now supposed to perform a different type of task. So that entire training transition is actually done under a robust training program. We have 20 trading centers on a pan-India basis run by X army person to get the best out of training to the people who are provided. Similarly, we create new training opportunities for new solutions. So in our case, what kind of response service guys should provide right? What kind of training, what kind of services you need to render. So those things are articulated well and actually shared in a proper trading to the response team as well.

Thanks for this. So basically, the people addition that we have been seeing in the past, that pace should see a significant decline if this part of business scales up as for SIS as a whole. Is it the right way of looking at it?

No, no, no. I will not look at it in that fashion. The technology business deployment is there in a particular segment, in a particular customer category, whereas a physical deployment is happening into a certain segment or a particular category. So that will remain and there I don't see any opportunity to decline. But yes, optimizing will definitely happen. Probably the same guy can do multiple tasks as compared to 1 single task, what it's doing today. That optimization will definitely happen in the years to come.

Thanks Chirag for your question. Aasim I request you to go next.

Aasim from DAM Capital Advisors. Hope you can hear me. So I wanted to know what is the gross margin in the India security business today? And how has that trended over the last 3 to 4 years? And besides VProtect, is there anything in the primary physical guard business that can be done to increase gross margins from these levels?

Brajesh ji, I request you to address that. But before Brajesh ji response to your question, Aasim I just like to share that in terms of gross margins, typically, we don't really share numbers specifically. But what I can give out is that sort of constantly kept the focus on gross margins and ensure that they stay at similar levels even during the COVID period and after that. We really try to focus on that because that's really -- that's where our negotiating power with the customer is visible. So we typically try to maintain that at similar levels, and that's not really been impacted. Brajesh ji, I'd like you to add some color to that.

Yes, Aasim. Thanks, Shweta, you have already covered that part. I can only say that even during COVID period, our gross margin has been intact. We have not got any drop in that and that we are maintaining. And we are very much focused to ensure that, that will remain the same. And more and more the solutions business will increase their contribution. This will further improve. So that is what I would like to say on the gross margin part.

Sure. Sure. I can understand that we would not want to share the numbers. But just to understand, are we better than the next 4 peers in terms of margin? Or is it similar? And similar to the industry levels?

Whatever number we have, published numbers, we have -- they also don't give the gross margin number that is not published anywhere. Whatever the information we have, we are not better at least at par with all our competitors.

At par. Okay. Okay, sure. And on the alarm monitoring business, sides business, I think in the existing site of 15,000 order, is it -- I mean, you did mention that you have logistics customers, but on the other part, is it all ATMs or are there other premises as well?

Aasim, we have ATMs, we have bank branches, we have residential houses. We have warehouses. We have small to large offices as well. So it is basically a mix of all the solutions.

So I think counting the banks and the NBFCs that was, what, around 90% of the overall mix, if I remember.

Yes, correct.

Within the 90% also, I mean, I'm assuming a large part will still be ATMs, right? Or is this a fair share of bank branches as well?

Large part will be ATM followed by bank. So private banks, all whatever we have mentioned in the presentation, they all are branches. We do complete branches for them. Whereas all the PSU, it is full ATM. Private branches is full bank branches actually.

Okay. Got it. Got it. And just lastly, just wanted to kind of reconfirm, I think you mentioned VProtect revenue in FY '23 would be around INR 60 crores, INR 65-odd crores and the target is INR 100 crores for FY '24, right?

Correct. Absolutely.

Thank you, Aasim, for your question. I hope we addressed it fairly well. I think we can take the next question from Shalabh Agarwal. Please go ahead and ask your question.

Hello, Am I audible?

Yes, go ahead.

Thank you for giving this opportunity. I'm from Snowball Capital. We are semi-registered investment advisers based out of Hyderabad. Sir, a couple of questions. This is Mr. Shankar first. So from the slide that you presented, we have close to around 10,000 ATM sites plus/minus. But overall, ATMs in the country are around 2.5 lakhs. So is there something which is of concern to these banks, which is stopping them to convert to the Alarm monitoring system, given the obvious cost benefits that we have shown?

Sorry, Shalabh. I was talking and got muted. Sorry. Okay. See, I'll tell you the 2.5 lakhs ATM, which is available on a pan-India basis. These ATMs are divided into 2 categories. One is CapEx ATM, 1 is OpEx ATM. Our CapEx ATMs are the ATMs, managed by the bank, OpEx are the ones which are managed by the service provider -- the master service providers, like CMS, AGS, those kind of categories, where they do the complete deployment of system plus infrastructure plus security solution. So those kind of things are already deployed. Now coming to the bank side, that is the CapEx ATMs, which are getting deployed, I would say, in the last 3 years, majority of the sites are on the conversion completely. And maybe in the next couple of years, you will see 100% of the ATMs, which will be operated through intrusion alarm system only without any guarding solution applicable on those sites unless and until specified by any state regulatory like Civic Authorities like police, they might request one certain areas due to certain sensitivity, they may request for guarding person to be deployed. But largely in the next couple of years, you will see everybody move into an e-surveillance solution, moving away from the guarding solution.

Sure. And so you said, so how much would be CapEx ATMs would be there as part of the over 2.5 lakh ATMs in the industry?

Shalabh, I'm sorry, right now, I'm not carrying that information. Probably, I can share it with you through Shweta, if that works out well, I can give you the complete break up, that's not a problem.

Sure. That will be helpful. And sir, are the SLAs any different for guarding solutions versus the alarm solutions at an ATM?

So the SLAs are completely different because here, we are not just managing the ATM. We are managing the power. We are managing the infrastructure. We are managing the hygiene part of it and also the emergency response services. So this is more comprehensive in nature, but using technology as a primary footprint in that.

So does it also mean that there's a higher liability to you in case any untoward incident happens?

No, we have a limited liability clause in there as well.

Okay. Okay. This is helpful. So the second question is for Mr. Chaudhuri on the India Security business. Sir, in 1 of the slides, you showed that in IT, ITES, we have customers like bigger IT companies like Wipro. So just wanted to understand when these security contracts are given out, these are decided at the HO level at the -- and then given out to multiple vendors distributed between multiple vendors or say, primarily say if SIS has chosen that the entire contract will be given out to SIS for all the offices across the country. How does it work typically in the industry?

See, normally, most of the companies, they have -- they prefer to have multiple service providers because they don't want to keep all their eggs in 1 basket. And there are 1 or 2 specific companies where the decision is 100% on X or 100% on Y. Like you were talking about Wipro, in case of Wipro also, there were multiple. So normally, these people go for 3 approved best service providers, and then they decide that what will be the share between the 3. So it is not necessarily that 1/3, 1/3, 1/3. It can be depending on the best performance or the cost portion put together. They can take a decision that, okay, 40% and then 30-30 or whatever. So it's up to them. But normally, it is not on 1 particular service provider.

So typically, what would be the SIS's wallet share for some of these bigger names, IT companies like TCS or? I didn't find TCS's name over there or Wipro or [indiscernible].

There are many, actually, we couldn't put all these particular names in that small box, but then TCS, yes, TCS, SIS is 1 of the primary service provider. But in case of TCS specifically, because TCS does not believe in changing the service provider unless there is something very, very serious against them. So there are companies, the local companies who have been providing services to TCS even for last 20 years also. So -- but then again, we are in TCS in some places. And then we have been getting TCS contracts because they have been moving from 1 local or not so prominent or they expect a better service on ground. So new contracts are coming from TCS to SIS also. So in the process, I can say that SIS share with TCS is gradually increasing.

Thank you, Shalabh, for your questions. I hope we addressed them well. I see there are 2 handraisers by Aasim and Kunal, do you have follow-on questions? Aasim, please go ahead. Okay, Aasim has lowered his hand. Kunal, if you have a question, you could go next.

Yes. Thank you for the follow-up. So basically, I wanted to understand, if you look at our India Security Services business, we have seen lot of employee addition in the last 9 months after COVID. The pace has increased significantly. However, when we look at the revenue growth, it has not been kind of like it's been lagging compared to the growth in the number of employees. Just wanted to understand how much -- how should 1 look at the -- what is typically the lag between hiring the employees and then deploying them and that's getting reflected into the revenues because what -- the way we would typically understand is that hiring employees is a lead indicator for the future revenue growth. How should 1 look at the relationship between both? And what is the lead and lag time that 1 should keep in mind?

Brajesh ji, would you be able to address that?

There has been growth in revenue across country, there has been growth in number of manpower also for security. The only thing that revenue per [indiscernible] what we call it how we see the revenue that will not remain the same because every time the minimal increases the rate gets increases. So the number of person through which in case we are getting INR 100 crore revenue for that INR 200 crore revenue, it means that next year, 100% addition will be required in that manpower also. But manpower -- the growth is there in number of manpower also. Currently, we are operating at 186,000. I think at the beginning of the year, we started with about 150,000 or 155,000. I don't have that get number. But every year, we are adding manpower in our business.

Yes, got it. But my question was more to do with the relationship between revenue growth and the manpower growth, like what is the lag between them? Or it is like a real time, if you were to add, say, 100 employees in a particular year, build those 100 employees contribute upfront or it will -- there will be a lag between hiring and actual revenues coming in?

No, there is no lag, from day 1, they are getting deployed. The lag is only in case we recruit anybody who don't have the experience of security guard. But during that training period, they don't get paid. They take the training and then they get deployed. Their wage structure starts the day from the -- which they get deployed at the customer location.

Sure. And last thing is on the attrition because if you look at -- in this industry, the attrition, like generally, what we hear when we talk on the ground is attrition is very high. So what is our attrition in the India Security businesses and how we have kind of handled it over the years and how it is vis-a-vis the competition?

Sure. So I'll just start off on this and then maybe Tapash ji can add some more thoughts on that. So Kunal, typically in the attrition overall in the security industry, across India is fairly high, as you rightly pointed out, across the industry it ranges between the 30%, 35% mark or even slightly upwards. At SIS as well for us also attrition is higher, but relatively lower compared to the industry, we range between the 25% to 30% kind of a mark. And as you understand, this is something -- this is an industry driven by minimum wage. So wherever some of the blue-collar workforce finds better opportunities, they tend to move. And also what happens sometimes security guards may be deployed at a particular site for a couple of months over 1 quarter or so, they might actually move back to their villages for farming, for harvest season, et cetera, and then come back. So even when they're moving out, still counted as attrition, although they would have returned back to their security basis. So that's how it typically works. And to be able to address some of that SIS definitely offers a very detailed training program, and we have 1 of the best training program, best sort of training on the job as well that we provide. And that sort of keeps the employees more stationed with the company rather than moving out. But yes, fairly attrition is slightly at a higher level given it's an industry-driven by minimum wage. Tapash, would you like to add some more in that?

Yes. I will add -- see Kunal, the better quality you recruit the more is the possibility of higher attrition because they have alternate employment opportunities. Okay. But now in case of SIS, it is very special because of so many extra additional benefit for all those direct staff who comes in security as a profession. So that time, they always compare that if he leaves and remains in this particular security industry, then probably there is no other better employer than SIS, but if he get an alternate opportunity in a better sector, a lot of people, whoever was deployed in banks premises. So ultimately, over a period of time, they got into the payroll of that particular banks also. So everybody is pretty conscious that what about their future growth and all these. So I must say that SIS is actually a better organization in terms of retaining these particular people even at that level and roughly around 30% or so yearly is the attrition rate, whereas there are companies, even the prominent companies in the industry, some of them have got even 70% plus. So -- but then again, it all depends on how fast the minimum wages get changed to a sustainable wage pattern so that it continues to be a wanted sector for them.

Thank you for your question. If there are any other questions, please feel free to type it on the chat or raise your hand. We'll be happy to address those. In case there are no more questions, I think -- okay, there's no more. Shalabh, if you have a question, please feel free to go ahead.

Question is for Mr. Chaudhuri again. Sir, just wanted to understand what levers do you really have because you are the largest -- being a largest security service provider, you have the largest number of sites. What levers you really have to cross-sell other products of the company like FMS, especially? And given your experience -- because these are very sticky services as you yourself mentioned, and given your experience, how easy or difficult has it been for you to really cross-sell some of the other group services to your existing customers?

See, when you are talking about cross sale, which is driven by the huge salesforce the SIS Group has got. We have the largest salesforce in a country roughly about -- only in guarding sector itself with about 150 boys who are working. Now a specific task and the target has been provided to them that you had to go for cross-sell because the same customer you are approaching, you are only asking for guarding, somebody else from facility is asking, again, introducing himself in the SIS group, but then there is a different repetitive process. See, these basic training has been provided by all these staff who are in the forefront. And they have an idea that whether they have to sell guarding SIS, they can sell SMC, they can sell DTSs, they can sell Tech SIS, they can sell VProtect. So they are all master now when they are handling these particular products. As far as the understanding of the product or the product knowledge is concerned, it's basically driven by the common sense. And when you recruit a reasonable standard of people in this particular network. So you expect that they should do have the cross-sell as the company wants. And at the same time, they also grow within this particular system.

Thank you Shalabh for your question. Do you have another question, your hand is still raised?

No, I'm good. Thank you.

Thank you. Kunal, I see your hand is raised. Do you have another follow-up question? Thank you. I think that was the last question. Thank you, everybody, for attending our session on India Security and VProtect. Hopefully, we were able to address all your questions. Our next session is on 11th April, which is on SIS International. Murli, who is the president of SIS International will be taking us through his business segment. Hope to see you guys there. Thank you, everyone, for joining in. Thank you to the management for participating in this conversation. Thank you all. We can now end this session. Thank you.

Thank you.