Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Xelpmoc Design and Tech Ltd (BOM:542367, Financial) has shifted its focus from startups to the corporate segment, which is expected to stabilize revenue streams.
- The company reported an increase in quarter-on-quarter revenue from INR7.3 million in Q1 FY25 to INR16.3 million in Q2 FY25.
- Operating EBITDA losses have decreased significantly from INR36.6 million in Q2 FY24 to INR10.2 million in Q2 FY25.
- The company has a diversified revenue stream with both startups and corporates contributing to its income.
- Xelpmoc Design and Tech Ltd's portfolio companies, such as Mihup and Woovly, are showing promising growth and potential for future revenue increases.
Negative Points
- Year-on-year revenue has decreased from INR21.1 million in Q2 FY24 to INR16.3 million in Q2 FY25 due to the transition from startups to corporates and discontinuation of government business.
- The company is still experiencing net losses, with a net loss of INR11.2 million in Q2 FY25.
- The startup ecosystem is facing significant challenges, affecting some of Xelpmoc's portfolio companies' growth plans.
- The company has reduced its team size from 63 in Q1 FY25 to 49, indicating potential operational challenges.
- Xelpmoc Design and Tech Ltd is not currently onboarding new startups unless they present exceptional opportunities, which may limit future growth prospects in that segment.
Q & A Highlights
Q: What is Xelpmoc's current strategy and focus, especially regarding its products and services?
A: Srinivas Koora, Whole-Time Director and CFO, explained that Xelpmoc has shifted its focus from startups to the corporate sector to mitigate risks associated with startup mortality. The company is concentrating on developing its own products, particularly targeting the corporate segment with data science and AI solutions. They are also integrating previously independent modules into comprehensive solutions for specific domains.
Q: Can you provide any concrete projections for revenue from Xelpmoc's products and services in the next 6 to 12 months?
A: Srinivas Koora stated that while there has been an increase in revenue from licensing and other services, the company has not yet reached a steady state of predictability. They are focusing on maximizing current opportunities and expanding their customer base, but it will take a few more quarters to establish a reliable revenue forecast.
Q: What is the status of Woovly's social commerce business?
A: Srinivas Koora mentioned that Woovly is continuing its regular operations, but the focus has shifted to a new initiative with higher revenue potential. This new venture is accumulating revenue faster than the traditional social commerce track.
Q: Has Xelpmoc received the funds from Portugal, and what is the status of the Signal project?
A: Srinivas Koora confirmed that the funds from Portugal were received in May. Regarding Signal, the company is shifting its approach from direct-to-consumer to a school-based model due to high customization costs. They are currently conducting paid proof-of-concept trials.
Q: Are there any new opportunities or projects that Xelpmoc is excited about?
A: Srinivas Koora indicated that Xelpmoc is now focusing on assembling existing modules into solutions that meet specific market demands. They have let go of some startup opportunities to concentrate on more stable and predictable ventures, which are showing promising market traction.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
