Ladies and gentlemen, good day, and welcome to eMudhra Limited Q2 FY23 Earnings Conference Call hosted by Yes Securities. We have with us senior management of eMudhra on the call, Mr. Venkatraman Srinivasan, Executive Chairman, Mr. Shaji K. Louis, Chief Financial Officer, Mr. Kaushik Srinivasan, Senior Vice President, Product Development. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Venkatraman Srinivasan for his initial remarks. Thank you, and over to you, sir. Yeah, thank you. Good afternoon to all of you. Welcome all of you to our Q2 FY 2023 earnings conference call. A copy of our Q2 FY 2023 earnings presentation has been made available in our company website and on the stock exchange portals. Hope all of you have had the opportunity to go through the same. Coming to the company overview, I would like to briefly summarize the company overview for all the participants. Having started our business in 2008 with a mission to accelerate the transition to a secure, integrated digital ecosystem for individuals and organizations with digital identity and trust at its core. We laid great focus on product development, enterprise solutions, cost management. We're also emphasizing on security, compliance, governance, and client support. Currently, we have 162,000 retail customers and 100,000 channel partners for our digital trust services business. We have 303 partners in India and 284 partners in other countries around the world for our enterprise solutions. Our enterprise solutions covers both government and private sectors and has a client base of 679 customers globally. Now we will proceed to review our recent quarterly performance. We are pleased that we continue to maintain our strong financial metrics in Q2 FY 2023 and aspire to remain committed to the same going forward. During the quarter, our total revenue stood at INR 599 million, a robust growth of 20% year-on-year and 12% quarter-on-quarter. Contribution to revenue growth was from trust services and the enterprise solutions, primarily because of new customer acquisition, international market expansion, and incremental cross-sales. I would like to present key highlights and project wins of Q2 FY 2023. One. Rollout of e-signature workflow, emSigner solution, for a mid-market electronic appliance retailer in the US, as emSigner will be used as an integrated offering to manage both document signature and document movement. Delivery of organizational eSign for many customers in India across government and other sectors. Implementation of CA solution, emCA, for payments and security for a central bank in Middle East, in Middle East. Four. Rollout of emAS IAM, Identity and Access Management, for smart city projects in India. Five. Implementation of electronic bank guarantee using emSigner for a large bank in India. Again, we have added one more branch in Sharjah in UAE, and again contemplating to set up more branches in Saudi Arabia, Qatar, Kenya, to cater to the growing client base in the region. We acquired an initial large customer for SSL business in Middle East, apart from acquiring some customers in India. Enhanced our mSigner portal and validation methodology to improve market penetration. Launched initial version of mDiscovery for enterprise SSL certificate lifecycle management. mDiscovery was one of the product emphasized by us in our IPO document. Our solutions are getting adopted in newer use cases in payment security and file encryption, which is likely to open up newer market opportunities. Started undertaking data center expansion in both Bangalore and Chennai, which are expected to be completed in March 2023. We are optimistic about the new market opportunities for mSigner and eSign arising out of the changes in the recent IT Act, permitting usage of digital signature certificate for immovable properties, power of attorney, and other use cases. With the above strategic focus and key wins, we are confident of our future, largely supported by our commitment to deliver secure digital solutions. Our decade-long experience in a rapidly evolving technology market has given us the assurance to maintain our leadership in the digital security industry. This will ensure our market penetration capabilities in the domestic and international market. May I now request Mr. Shaji K. Louis to take us through the financial performance of the company. Thank you, sir. Good afternoon to all the participants. I'm pleased to present the recent financial performance of the company. Continuing with our growth momentum of Q1 FY23, we are happy to report a total revenue of INR 599 million, a year-over-year growth of 20% for the quarter. The increase was majorly led by the enterprise solution segment, which registered a revenue of about INR 366 million, a year-over-year growth of 47%. The trust services registered a revenue of INR 221 million, a degrowth of 9% year-on-year, but a sequential growth of 14%. Our H1 FY23 total revenue stood at INR 1,127 million, a year-over-year growth of 21%. Our EBITDA for the quarter was INR 231 million, up by 35% on year-on-year basis, and the margin stood at 39%. The growth and margin improvement was driven by a higher contribution from the enterprise solution business and internal operational efficiencies. We registered a net profit of INR 165 million, up 58% year-on-year with margins of 28%. Our H1 FY 2023 EBITDA and net profit were at INR 443 million, with a margin of 40% and INR 30 million with a margin of 27% respectively. Our focus will be on working on the strategies envisaged for the purpose of our IPO and to expand our client base through range, reach and verticalization, and thereby increasing our market share. Thank you very much. Now we will be happy to answer any question you have on company's recent performance. Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question may please press star and one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is on the line of Abhishek from Naradi Investments. Please go ahead. Good afternoon, sir. Thanks for taking my question. Question first to you. Said in the last call that enterprises business will grow. Hello? No, it is not audible. Can you repeat? Hello. Hello. Yeah. Yeah. You said in last con call that enterprises business will grow more in compared to trust business and the export turnover is also flat in this quarter. Do you see any challenges in export business and enterprises business? No, there is no challenge in export business. If you see export business, almost from INR 9 crore it grow to INR 19 crore, kind of level in the last quarter. That's how it is maintained at INR 19 crore. Further we see a lot of growth momentum. Now if you see, we have got a major customer in the U.S. for our emSigner product, then major customer in Qatar for the emCA product. It continues to grow well, but because the last quarter the growth was almost 100%, again the same kind of thing was not maintained. Overall the growth is very good. Almost from the last year to year, if you see, it could be a 70-80% growth kind of thing or even more. Okay. There is no stagnation or anything in the export business. Enterprises business grow 10.6% quarter-on-quarter, but trust business will grow 14.6% quarter-on-quarter. You said it, enterprises business will more grow compared to trust business. Any challenges in the enterprises business? No enterprise- quarter-over-quarter. No, there is no challenge. Even in quarter-on-quarter, enterprise business growth has been very good. If you see quarter-on-quarter, what is the growth in enterprise business? INR 33 crore-INR 39 crore. INR 33 crore-INR 39 crore. Yes. Almost 20% it has grown quarter-over-quarter in the enterprise solution. Okay. Second question, what kind of margin you expect in H2 and FY 2024 as a whole, and also in this quarter trust business margin suddenly go down. Any specific reason? In the trust business there are two things, two reasons why the margin has suddenly gone down. One reason is the composition of token compared to DSC, because wherever the DSC is more and token is less, the gross margin will be higher. Wherever token is little more, gross margin will be lower. That is one reason. The second reason is the pricing pressure itself. If you see, compared to last year same period, almost because of the competition and because of the new entrant and all that, the pricing has come down by 25%-30%, but it is partially compensated by increase in volume of 15%-16%. Because of these two things, this, in the trust services business, the gross margin has come down in this quarter compared to the last quarter. Okay. What kind of margin you're expecting in H2 and FY 2024 as a whole? As a whole, because we are. That's why we have two or three segments, only the trust service and the enterprise segment, and within enterprise segment international. Even in one segment, if a little bit it comes down, it compensates by the other segment. That's where even if you see, though in the trust service margin has come down a little bit this time, but the overall EBITDA margin has not come down significantly, and still we have achieved almost a good EBITDA growth. In H2 around, it may be 38%-40% we will achieve? What is it? Can you repeat the question? In H2 EBITDA margin, 38%-40% range. Yeah, that's what we are hoping because we are more a product-centric business. That's where we hope it should be possible to achieve around that. Maybe 1% here and there it can go, but around that should be possible. Okay. Last one. How is the order book value now? Order book is continuously increasing. Okay. Okay, thank you so much, and wish you a happy Diwali. Thank you. Thank you. The next question is on the line of Sarang Sanil from RW Investment Advisors. Please go ahead. Good afternoon, sir. Great set of numbers. Sorry to interrupt, Sarang. Sir, there's a lot of disturbance from your line. Yeah. Some work is going on, so we are trying to stop it. Just it will take one minute. Yeah. Okay, sir. Okay. One minute. Yeah. It has stopped now. Yeah. Am I audible, sir? Yes. Yes. Yes. Great set of numbers, sir, honestly. Thank you. you. Thank you. Sir, couple of questions. Can you explain how mDiscovery will strengthen the trust services vertical, as you have explained on the DRHP? Can you give an overview of this product? In mDiscovery, what happens is it is generally used by the large organizations and also large banks and also in the government. Once they install the mDiscovery, automatically it daily, on a whatever frequency you would set, the product crawls over all the websites of the company or the bank or the government, and then see what date, what kind of certificate is expiring, because every website needs to have an SSL certificate. It will automatically find out the SSL certificate expiry of the various things. Once it expires, what will happen is sometimes because of the expiry and if they don't renew it on time, then the website itself stops also. That is the danger of not renewing on time. Some companies may have some 1,000 SSL certificates, 500 SSL certificates and all that. The probability of not noticing some expiry and not renewing is very high, which suddenly affects the business. That's where timely expiry is very low. Once we install our mDiscovery product, the idea is whenever it crawls and finds then some SSL certificate is expiring may be within a week or something, it will throw a message to us, and then we are also selling SSL certificates now. We can put our SSL certificate into that organization. That is where it will enable us to sell, cross-sell our SSL certificates into that organization. Now the other certifying authorities are generally not having this kind of product. Independently, two large companies in USA are having this product and they are routing to certifying authority. Here, as a one-stop shop, we want to create this so that we can have the advantage of routing it to us and the ability to issue our own SSL certificate. Okay, understood. This product would be a small ticket size product. Since it gives you an opportunity for cross-selling other products, it's a better opportunity for the- No, it is not a small ticket size. It can be easily $100,000 per instance. Okay. Yeah, it is not small ticket size. $100,000 means INR 70-80 lakhs. It can be easily sold. Some of the larger corporations around the world, sometimes even you can sell at $250,000, $300,000. For mDiscovery itself, sir? mDiscovery itself. That is where the Venafi and other companies are selling at those price range. Okay, sir. Sir, next question is on trust services. Sir, should we see trust services business on a sequential basis or on a YOY basis? No, sequential basis you can see because sometimes the demand, certain demands are not. Earlier it was all because predominantly it was used for the income tax season. Every time you can actually predict first quarter will be like the second quarter, third quarter, fourth quarter. Now that the more and more use cases are coming, it is not only for the income tax company kind of thing, so many use cases are there. That's where better to see sequential quarter. That is better. That's what I feel. Okay. If you see the number-wise compared to even last year, our number of sales is up by almost 17%. The price drop of around 28-30%, that's where compared to year on year, there is a drop of 9% in the trust service digital signature business. The overall revenue is it got compensated by three factors. One is the new SSL business, which has started giving good revenue, which commenced only around December of last year. The second thing is the corporate e-signature and all that. That way, even though compared to year on year it was lower because of the price drop, it is compensated by the other. Okay, sir. Pricing is volatile across the market, correct? Volatile. Yeah. Yeah. Okay. Sir, last one. Sanal. Okay. Not in the retail. We sell in the retail. Retail has been consistently good and it has consistently improved. That's why we are trying to sell more and more through direct retail instead of channel. That way it is also picking up. If you see 1 year back, retail was from INR 5-6 lakh per day, now it has gone to some INR 8.5-9 lakh per day on many days. That is why our aim is to sell more retail, but in the channel, because of the so many competition increasing, the prices are volatile. Okay. On the retail side, there is not much of revision. No, no. Going on. No. Okay, sir. Okay, final question is Shaji, sir. Sir, we can see the tax expense for H1 this year saw about 300 basis points fall. I think 13.7% or something range, sir. What will be the effective tax rate for the year, and how is it going to be in the coming year? Okay. Maybe Shaji K. Louis will answer. Yeah. Tax expenses. Indian companies, we are providing a tax expense of 25% on the profit before tax figure. For the foreign entities, presently we are not coming under the tax bracket in any of the foreign entities. Mm. That's the reason why the effective tax rate is slightly lower if you take the consolidated figures. Yeah. Okay, sir. Sir, do Indian companies have any good extension in Middle East? Because you are also expanding a lot in Middle Eastern countries. How is the tax rate there? Even once you expand there, would the tax rate for the entire company, for our company be in the 18%-20% range? Yeah. In foreign presently there are no taxes, but in future in case we introduce the taxes. To the extent of Middle East expansion, as of now, no tax. Yeah. The thing is, they are also thinking of imposing a 9% tax from the next year, even Dubai, Middle East. Oh. Another thing is our expansion is not only in the Middle East, we are also trying to expand in U.S., expand in Europe and all that. In U.S. if you see, there will be a corporate tax of 22%, and if you take Singapore it will be around 17%. That way only big advantage of 0% tax as of now is the UAE, which also might go next year. That is where the average tax over time, apart from India, even foreign geographies, some taxes may come. Okay, sir. Understood. Okay, cool. Thank you so much, sir. I'll call back in the queue and Happy Diwali to the team. Thank you. Thank you. The wish is here. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. The next question is from the line of Piyush Pandey from YES Securities. Please go ahead. Thanks for the opportunity. Sorry to mention that eMudhra Solutions. Sorry, Mr. Pandey. Sir, your audio sounding very muffled. Can you use the handset mode while speaking and not the speakerphone? Is it better now? Yes, sir. Please proceed. Thanks for the opportunity. It is mentioned that eMudhra Solutions has found adoption in use cases like payment security and file encryption. Can you please explain more about it? Yeah. We are doing a project for a central bank where they are essentially securing the infrastructure for all the cards, credit cards, debit cards that are being issued to citizens in that country through the use of digital signature certificates. Any card that is going into and getting scanned in a POS terminal will be validated through digital signatures. First effort is with the central bank and over time this will also be used for the issuer banks. Essentially there is a lot of use cases around card payments and essentially the card security which are being secured through the digital signature certificate and public key infrastructure. This is one of the use cases. The other use case is more file encryption and data encryption, both data at rest and data in transit. Here again, when you start sending confidential messages to a distributed set of people, particularly in sensitive organizations, digital signature technology, particularly the encryption technology. Now various variants have also emerged and we've done R&D. Something called fully homomorphic encryption, which allows even search on encrypted text, right? These are the newer use cases that are coming primarily from card security and exchange of sensitive and confidential messages between various parties in an organization where such data needs to be exchanged. Okay. Second question, like, how has the initial and which was recently launched? Your voice is a bit muffled. Like, so how was the initial customer traction for mDiscovery product, which eMudhra recently launched? mDiscovery. mDiscovery product, initially we are talking to a very big bank. Almost a proof of concept, everything is done. Then they are in the process of selection. Again, we are very confident we will win because in India we are the Make in India player. Other two competitors are from the U.S. and all that. That's where we feel that we have very good chance. The product itself offers a very high scope because everywhere it is needed. Because every company on average is installing some 100 websites, 200 websites, sometimes thousands of websites also. Each one is secured by an SSL certificate. These certificates are expiring on multiple days. If anyone forgets to renew any of the certificates, then they are in trouble because suddenly the website will stop. That's where the need of the hour is to correctly renew all the certificates. The mDiscovery product will provide for that. It will also provide when it is to be renewed; it will route it to us so that we can issue our own signed SSL certificate. That way there will be a lot of cross-selling opportunity. This is where we feel this is an initial thing, but still we are perfecting the product. Over the next six months to one year, the product will be fully perfected. Okay. Thank you. Probably there are two competitors, I think. One is Venafi and another one is AppViewX. We are trying to build the product in such a way that our product become superior to them over a period of time. Yes. Thank you. That's it from me. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Davesh from DS Investments. Please go ahead. Yeah. Hi. Good afternoon. Congratulations for a good set of numbers. My question was a little midterm-oriented. We are currently doing about, let's say, INR 60 crore quarterly run rate. If you were to look, definitely our global expansion is coming quite well, right? If I were to look at business's three engines, one being trust service, second being enterprise India, and third being enterprise global. The way this quarter and the H1 of this year looks is, global enterprise has done very well, while others have done decent, right? If you were to, you know, sort of, plan for ourselves reaching, let's say, INR 100 crore or some internal target that you might have for quarterly run rate, what kind of investment do you think that we will need to make, be it sales or be it product development? Just want to get an understanding that how do you see yourself, you know, growing from here over the next two-three years and what investment we need to make. Just a qualitative comment would be helpful. Investment-wise, as we planned in the prospectus of INR 15 crore investment, we are making U.S. market. We have already identified a senior person. We have identified a telemarketing agency to get the inside sales and get leads and then. All these have started happening, and we have also won one of the retail chain as our customer for the emSigner, so that both our emCA product and the emSigner product, already product reference also is built in U.S. This is one side, and we will be recruiting another four or five people there so that the U.S. market can be fit. Coming to the Middle East. In the Middle East, we have already got a good traction. We have got good orders from Saudi Arabia, good orders from UAE, then good orders from Qatar and all that. To cater to each of the country and to grow these countries better, we are opening separate branches in each country and recruiting the people. In India also we are strengthening the inside sales team so that they can contact those global customer and global partners and get more leads so that we can go into that. The Kenya, again, we have got the license to issue the digital signatures in Kenya, so we are doing the Kenya launch by maybe November end or December we are going to launch that. That way, geography-wise. In Indonesia we have started getting some traction, so lot of discussion is going on. There again, we have recruited three or four people and sit there and opened a branch office. Continuously we are evaluating and opening many branch office and then seeing how to go. Investment-wise, it may not be a major investment except if some very good opportunity we find and acquire. Maybe it could be in some small millions of dollars because we are not looking at very large company to offer. Otherwise, organic growth per se, we will go in a very measured way so that when we put some five people, it should yield some result, then only we put more people, not go in a very aggressive way. If it doesn't yield result, the negative side will be higher. That is not our approach at all. Got it, sir. Got it. That explains. If you were to look at our last five years history, we have probably done, you know, 20%-30% type of growth depending on the duration we see. So do you think organization is designed to grow organically with the same speed without too much investment? Is it the right way to look at it that currently we have enough product and with some sales investment, like you called out, we should be able to keep the run rate of 20%-30% growth here and there? Is that the right assumption to make over medium term? Yeah. Organization is designed, and we are also striving our level best to do it. What will actually happen will depend on the market and the market forces. From our side, definitely we are designing it that way and then continuously strengthen the technical team and the sales team. No, no, totally agree. Well, the way we are winning deals tells that product and quality and service delivery is definitely up to the mark as we won't be winning deals. Looks great around that front, right? Just since you're entering in many new geography, generally, you know, when we sort of enter a new geography, there has to be something that we do in initial deals. Either we keep the margins low or we commit something extra to the customer. Are there some, you know, some tactics that we are using to win these deals or it's just fair competition, fair pricing, fair everything? Just wanted to understand how aggressive we are. No. We just for the sake of getting business, we don't get into the loss-making business or too much undercut the price and all that because we don't believe that by undercutting and getting into that and later on price can be increased and all that. Tactically, one or two first deals, it may be possible, but definitely not continuously. We want to win the deals because of the product superiority and our efficiency in service and the functionality of the product and those kind of things, and our flexibility compared to the global players. We offer flexible model, because some of the global player may only offer the cloud model. We offer cloud model, private cloud model, on-premise model. We can get some amount of customization if required. That kind of flexibility and all this, and generally we are flexible on legal jurisdiction also. These are all the things on which we want to win the order, not by just dropping the price. Got it. The last one, if you could call out the key competitors in each of our product segments, just to help us understand who we are competing against mostly in the space. Like, you want to understand who are the key competitors? Yeah. For each of our product categories, just to get an idea. Yes. Yes. They'll be listed in prospectus, but I will repeat some of them. One is our trust service in India. If you see our trust service in India, there were at that time 15 CAs who were licensed by the Controller of Certifying Authority. Now additionally three or four additional CAs have come. Anyway, out of 15 CAs at that time, only four or five were issuing digital signature certificate for the public. Others were for the government purpose and their own private purpose and all those things, like Indian Army, Indian Navy, then IDRBT and all those people. Almost 15 people are the competition in the digital trust service segment, mainly in the Indian digital signature certificate, not in the SSL segment. SSL segment it is much less. If you see SSL segment, India, there is no player who can offer SSL. Globally, there are four or five players like DigiCert, then, Sectigo is there. Yeah. GlobalSign is there. These are the major players for the SSL segment. Coming to the solution business, mainly the emCA product globally, Entrust Datacard is one competitor, then Nexus is there, then PrimeKey is there. They are all global. India, there is no competitor. Similarly, if you take this paperless workflow, emSigner, main competition is from the DocuSign and the Adobe. There is no major competitor from India. Then the emAS product, almost de facto in India, we are the only player. That's why almost all the government projects, bank project, we only do the emAS product. This shows the competition is there. In several of our segment, the competition is very limited, and even if it is there, it is from the global US or European player and not from the Indian player. Got it. Thanks a lot, sir. That's quite helpful. Thank you and all the best. Thank you. Thank you. The next question is from the line of Rishi Jhunjhunwala from IIFL Institutional Equities. Please go ahead. Yeah. Thanks for the opportunity. A few questions from my side. Firstly, you talked about a 28% correction in realization on your channel partner-driven DSCs. Where would we be on average realization in terms of absolute value right now year to date? If you see last year, because up to December 2020, the prices were low. From January to March 2021, the price reached a peak of for a class three, two-year signature. I'll take one product and then comparatively other product we can take. Class three, two-year signature product went up to INR 350-INR 375. From INR 350 to INR 375 in January, February of 2021, almost in 2021 middle or 2021 end it reached around INR 250. INR 250 or a little more. The average, because there are other products also, class 3, two-year is there, class two, three-year is there. With all these things we were realizing INR 275, INR 280. Now this class three two-year product from INR 250, it has recently come down to INR 180. Almost that is the 28% drop. With the 28% drop also, our average because of the composition of the Class three, two-year, Class two, three-year and those kind of thing, and also combo and all that, our average will be above 200. Understood. What is the reason for this correction? Reason is because the other people, to gain the market share, they are going on reducing the price, but still not able to gain much market share, but they think they can gain the market share. That's why these four, other four competitors who are there, no, not Sify, but there are other three or four people, which earlier we had mentioned. Those people went to reduce the price, but still almost the market share remains same. Actually, in terms of the number of digital certificates sold, our number has increased by 17% in the first half of current year compared to the first half of last year. From a value, because of the 28% drop, the overall value has little bit dropped. Sir, won't there be risk for further realization correction going forward? Beyond that, they cannot go down too much also. Maybe another INR 20-INR 30 it can go, but we can still compensate because our retail is very stable and retail is actually increasing. That is one thing. The SSL is increasing, so that way even if they further drop the price. Still because of the brand image, we command the premium of 20%-30%. In spite of their price drop, we have not dropped to that extent, whatever extent they have dropped. Still we are commanding our market share and our number has only increased number of sales. That way we can manage. Understood. Sir, you mentioned. Beyond some level, they may not be able to go down to 50 INR, 70 INR because then it won't be viable to them. True, true. Now no funding also will be easy to get. I don't think they will. They may go and reduce further. Fair enough. On retail customers, you've given a number of 162,000 plus. Yeah. What was this number same time last year? 145,000. Yeah. Understood. Basically it builds afresh every year, is it? Because I think, end of the year, that number was much higher. No, no. Retail customer base are not building. As of now, currently, whoever is using the signature, that's what we are saying. The signature validity is generally two years only. The predominant number of signature is two years. Whoever is holding a valid signature as of the September end, that is the analyzed result. The retail result. Understood. No, because I think our number was, like, probably closer to 200,000 at the end of fiscal 2022. I'm just wondering whether that number should decline, or is there a reason for that? No, I don't think it has declined. Maybe we will analyze and then come back to you. Exactly quarter by quarter we can put and give it to you. All right, sir. It's not declined definitely. Because daily I am monitoring. Daily sales of the retail sale has really increased only in terms of amount. I don't think it has declined, but I will give. We will examine again and come back to you. Hardly any mistake is there. As a percentage to our trust service revenue, the retail is again the same percentage we are maintaining. 30%+ of our trust service revenue is still coming from the retail segment. It has not declined. Understood. On the enterprise side, you know, is it possible to give some color on, you know, the potential, the current order book, even if you don't quantify it, can you suggest whether it is growing in line with how our revenues are growing? Yeah. Definitely. Not only order book, even the pipeline what we are chasing, it is growing in line with or more than in line with the revenue whatever growth is there. Because we are daily tracking the pipeline and the order book, both are growing. You haven't seen any kind of slowdown because of, you know, all the macro-related concerns, especially outside India business? Not up to now, we have not because the niche area which is a requirement for everybody and because of this, lot of cost saving will happen. For example, this U.S. customer to whom we have sold, so by using our solution, they have estimated that they may be saving almost $1 million per year. Understood. More than that, yeah[crosstalk]. On the overall business, is there a seasonality between 1H versus 2H, in the sense 1H you have total done roughly around INR 110 crore. On a sequential basis, is it fair to assume that it will grow 10%-12% for 2H, sequentially on a quarterly basis as well? Or four quarters don't really matter? Especially, I'm asking on the enterprise side. No, enterprise business is known for the seasonality, but because of our pipeline, what we are chasing and the order book, we feel definitely it can, it will grow further. Understood. Because typically we see products businesses internationally have a seasonality, stronger seasonality around December quarter also. Trying to understand whether same plays out for us as well. No, that is mainly in North America and the West, in the December quarter, Christmas holiday, they may not sign and all that. Ours is not only North America, predominantly a lot of deal happening in Middle East also, in Africa also. It may not affect much. Sir, on the you know is there a particular reason why our expense around stocking trade you know is fairly volatile? Is it based on what we end up buying rather than what we end up selling on the devices? No, not stock trade. Stock trade or you are talking about the operating expenses? Yeah, yeah. INR 7.3 crores. Operating expense at this time, in the top line composition, the token is more little bit. If you see, there are two components. No, one is the digital signature, other is the token. Whenever the token is more in the top line, correspondingly it will also have more cost on the bottom line because on the token the margins are very less. That's where the operating expense is higher. That's why the gross margin is a little lower. Okay. Understood. Sir, one last question. In key project wins, the second bullet that you have mentioned, can you elaborate a bit more in terms of whether is it like a combination of multiple smaller wins that you're talking about, or is it one win? We're not able to understand that clearly. The delivery of organizational eSign bullet. Maybe Kaushik can explain better. I'll ask him. This is a combination of multiple wins because basically, a lot of states are now embarking on various initiatives under the mission mode projects to sort of digitize and go paperless with citizen service delivery. As a consequence, they need to sign many documents. They are all using this organizational eSign, and our regulator permits the issuance of eSign to government officials, primarily through government KYC and organizational KYC for organizations. It's a combination of multiple deals, but essentially setting a trend for adoption of eSign for various use cases in government and other enterprises. All right. Great. Thank you so much. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question may please press star and one. The next question is from the line of Sarvesh Budani, an investor. Please go ahead. Sarvesh, your line is unmuted. Please go ahead. Yes, sir. Congrats on the good set of numbers. Sir, I wanted to ask a bit about the trade receivables that have gone up a bit higher this for H one. If you could explain the reason for it, and given the context, since you mentioned that competition is undercutting us a bit, offering lower realization. Is it an after effect of that, or what's leading to this higher trade receivables? No. Trade receivable, again, if you see comparatively, though in absolute number it has gone up, in terms of the number of days compared to the last September, it has come down only. Yeah. Last September it was 111 days receivable, and from there this September it has come to 96 days receivable. Correspondingly, our revenues are also going up. One more factor is almost more than 50% of such receivable is within one month. Within one month receivable only has increased. If you say more than 180 days receivable, it has only come down and as a percentage, and out of that also quite a bit, almost 25% of more than 180-day receivable is also received in the October first 15 days. That way it is not really a matter of concern if you work out based on the number of days compared to last September to this September. Mostly December it can further come down because some of the major government dues which are there, which are likely to be received now. All right. Thank you. Thank you. The next question is in the line of Sarang Sanal from RW Investment Advisors. Please go ahead. Just a follow-up question. Is it possible to give a break-up of trust services and enterprise, if you have the details, like how much would be, I believe DSC would be higher on trust services, but still, can you give a break-up of the revenue part? On what? How much DSC, how much token, like that, is it? How much DSC, how much token SSL or IoT? Okay. Let's see how the breakup. I think we are not segregating. We are not segregating that way in the segment result because the trust service itself is INR 20.7 crore. Forty. No, INR 40.9 crore for the half year. Within that only token is the hardware component. Otherwise, the IoT, SSL, everything is a very high margin business. So the token itself per se may not be even INR 7-8 crore. Yeah. Around that only. Okay, sir. No, I believe within trust services itself, major component would be DSC, right? Major component is DSC, yes. Okay. On the enterprises side it'll be emSigner. emSigner followed by emCA, and the third product is emAS. Okay. emSigner, emCA, and emAS. Okay, sir. Thank you. Sure. Thank you. The next question is in the line of Priyank Sethi from IIFL Securities Limited. Please go ahead. Yeah. Hi. Good afternoon, sir. Good afternoon. I just had two questions around, one would be around enterprise services, one would be around trust. In, actually, you know, last quarter you suggested that the Enterprise India business saw some sort of a blip considering, you know, with regard to government websites. What is your outlook on the same? Do you see, you know, this time also the growth has been around 9% is what I see. Is the growth soft, and what do you think the growth would be going forward? Mm-hmm. Similarly, sorry. Yeah, go ahead. Last quarter, Enterprise India was around INR 13 crore. This quarter it is around INR 17 crore. That way almost 20%- 25%, 30% growth it has seen compared to the last quarter. Now order book and pipeline is also building up very well. That way, whatever we expected, that level of growth most probably will be achieved. We are not seeing any blip or any slowing down of the order book for the enterprise solution. Understood. Understood, sir. Similarly, how would your outlook be for on the trust services side, considering that volume is reviving, though pricing pressure stays? How's your- Yes. Outlook for the year going forward? Outlook for the year will be initially we were achieving lower growth in trust services. Anyway, enterprise solution only we have taken the higher growth. Still we will have the same outlook only. Because whatever price drop happening, one is compensated by the volume growth and the other is compensated by the SSL, which is a new business. With that, on the overall, we feel we may not be affected much by the price drop which is there. The overall, whatever estimation we had done, that level of revenue we should be able to achieve. Right. All right, sir. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. Participants, if you wish to ask a question, you may please press star and one. The next question is a follow-up question from the line of Sarang Sanal from RW Investment Advisors. Please go ahead. Sir, you were leasing data center in countries outside India, right? And you had plans of setting up your own data center. Is there any CapEx plan there? No, we are not leasing any data center outside because the data center we wanted to do for the trust services business, where we are not permitted to lease, we have to create our own data center. In the prospectus we had put, one is the strengthening of the data center in India. That is our main center in Bangalore and the disaster recovery site in Chennai. That progress is happening. The other thing what we put is the putting a data center in Europe and Indonesia, so that we have not yet commenced. Only after finishing this Indian data center, then we will go with the international data center. These are all a part of our project. Some INR 43 crore or something is earmarked for that. Out of that, INR 13 crore is for the international data center, but it will be taken up only after finishing the Indian data center. Okay, sir. Okay, sir. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question may please press star and one. As there are no further questions from the participants, I now hand the conference over to Mr. V. Srinivasan for his closing comments. Yeah. As there are no further questions, we will conclude the call. I would like to thank everybody for joining the call. I hope we have been able to address all your questions. For any further information, kindly get in touch with our investor relationship advisors. Thank you once again and have a great day. Thank you. Thank you. Ladies and gentlemen, on behalf of Yes Securities, that concludes this conference call. We thank you for joining us and you may now disconnect your lines. Thank you.