Ladies and gentlemen, good day and welcome to the Q1 FY2023 Earnings Conference Call of Latent View Analytics Limited. 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 has been recorded. I now hand the conference over to Mr. Diwakar Pingle from EY Investor Relations. Thank you, and over to you, sir. Thank you, Jacob. Good evening to all the participants on this call. Before we proceed, let me remind you that the discussion may contain forward-looking statements that may involve known or unknown risks, uncertainties, and other factors, must be viewed in conjunction with our businesses that could cause future results, performance, or achievement to differ significantly from what is expressed or implied by such forward-looking statements. It gives me great pleasure to invite all of you to the Q1 FY 2023 Earnings Call of Latent View Analytics Limited. The results and the investor presentation have been mailed to you. In case anyone doesn't have a copy of the press release or presentation or you're not in our mailing list, please write to us, and we'll be happy to send the same to you. To take us through the results today and answer your questions, we have Rajan and Rajan. The CEO of the company is Rajan Sethuraman, who we'll be referring to as Rajan. We also have the CFO, Rajan Venkatesan, whom we'll refer to as Raj to avoid any confusion with the transcription. We will start the call with a brief update of the quarter given by Rajan, which will then be followed by the financials given by Raj. Having said that, my pleasure to hand over the floor to Rajan. Over to you. Thanks, Diwakar, and thank you all for joining the call today. I'm just gonna share a little bit of the highlights from a business perspective, and then I will pass it on to Raj. First off, we had a fairly strong quarter in terms of growth in revenue as well as EBITDA on a year-on-year basis. Our EBITDA did come in at a higher than planned range from a percentage perspective. We are able to continue to make the investments that we had indicated in our earlier earnings calls as well. The investments have been largely in the area of addition to the sales and business development bandwidth that we've been making in the U.S., but also to begin with in Europe and in India as well, and I'll talk about it a little while later. We've also been able to add people to the front end from a client services perspective, and we've been building up our delivery and capabilities as well offshore. Overall, we see good traction for our services, whether it is consulting or the data engineering work or the value propositions that we are building in different entity verticals, industry verticals or capability horizontals. For example, on the consulting front, we have had a few wins where we are helping organizations with the analytics strategy and the roadmap of initiatives that they should be executing. For example, a recent win in a tax automation fintech company, we are really helping the entire marketing organization starting from the chief marketing officer downwards in terms of thinking through their analytics strategy and how they should be setting up their analytics capability and how they should be structuring it. There is a good set of conversations that we are having on the analytics capability on the strategy and structure front. We also see good traction for the supply chain value proposition that we have been building. It's called ConnectedView. We've been talking about it in recent times to clients and prospects and also in the media. There are at least half a dozen conversations that we currently have where that value propositions are underway. We expect that we will start seeing the first few closures and wins in the coming quarters. On another note, the partnerships that we have been pursuing that has been progressing well as well. We signed partnerships with IBM's data services team and also with Neo4j, which is a provider of graph database and related solutions. We are starting to see initial conversations on how we can build these capabilities and bring them to the table with clients and prospects. I made a mention of the addition on the Europe front. Europe is an area that we are doubling down on the back of the IPO. We are making substantial investments in Europe. Our Europe business head has joined us earlier this month, and we also made a few offers on the sales and business development bandwidth and also on the delivery side. We are expecting that we will continue to ramp that up in the coming quarters. While this ramp-up is happening, we expect that the actual impact in terms of these investments will start playing out in a couple of quarters or so. We also kicked off India as a geography at the start of this fiscal year, happy to note that we are having a good number of conversations with Indian as well as multinational clients who need analytics services for addressing the market in India. We are expecting to notch up a few wins in the quarter too. Overall, we made a net addition of more than 100 people in quarter one. There was a heavy focus on campus hiring with about 80+ people coming from campus. Going forward as well, we believe that the bulk of the recruitment that we'll be doing will be focused on the campus joiners. Finally, I wanted to also highlight that we have been able to revive our analytics roundtable events. We were doing this prior to the pandemic twice a year, either in the West Coast and East Coast or sometimes in Europe as well. We have been able to reinitiate those roundtable events, and we did the last one a couple of weeks ago in San Francisco. I just got back from that event and had good conversations as part of the event, as well as subsequently meeting with clients and prospects. The roundtable event was well attended by our advisory council members, as well as clients and prospects. We do expect that there'll be several leads and conversations that emanate from that. Overall, a good quarter. We believe that we are on the right trajectory in terms of the investments that we are making, both in terms of resources as well as management bandwidth. At this point in time, I'll say that we are fairly confident about the trajectory for the current fiscal. With that, I'll hand it over to Raj to touch upon the financial highlights. Thank you, everyone. Good evening to all. First of all, I would like to thank and welcome all the participants on this call. Let me just give you a quick update on the financials for the quarter before we open up for Q&A. From a revenue standpoint, we reported revenues of close to about INR 120 crore for the current fiscal, which reflects a growth of about 37% on a year-on-year basis and 2% sequentially. Like Rajan mentioned, we continue to see fairly robust demand for our services. In fact, the order book continues to be fairly healthy, and we see increased traction on some of the newer conversations that are also coming into the pipeline. From a profitability standpoint, EBITDA for the quarter stood at about INR 35 crores, witnessing a 28.5% growth on a year-on-year basis. In percentage terms, the EBITDA for the current quarter came in at 29%, which was in line with our expectations as well, because one of the things that we continue to state, even right through our IPO journey is, we will continue to make a lot of investments from both a capability standpoint as well as in terms of enhancing our front end sales force. Some of those investments that we started to make immediately post the IPO and in the earlier quarters in this fiscal, some of those costs are now coming in. Of course, Q1 also had the impact of wage increments that we had given out, which range between 8%-10% across various levels in the organization. All of that had a marginal impact on the overall EBITDA margin profile. That is why you see a small decline from 30.6% that we reported for the last quarter to 29% in the current quarter. Our EBITDA margins, however, of course still continue to be at fairly healthy levels, and we are confident that some of the investments that we are doing will continue to pay off in the future. In terms of PAT, our PAT for the quarter stood at INR 40+ crores, reflecting a growth of about 80% on a year-on-year basis. Of course, the one thing that we do wanna highlight is, compared to the immediately preceding quarter, the tax expense for the current quarter was higher. The reason for that is in Q4 of FY 2022, we had a one-time benefit which came from exercise of options, employee stock options, more specifically in the United States, where as per U.S. tax law, you are eligible for a tax break on the exercise options between the fair market value of the shares as on the exercise and the price at which the shares are granted. The company is allowed to get a tax break on expense, which is why the tax expense for the immediately preceding quarter was lower. However, for the current quarter, what we've seen is, our tax rate, our effective tax rate is more reflective of what our long-term tax rate would be, and therefore, it is in line with our expectations. In terms of geographies, U.S. still continues to be the dominant geography for us, contributing about 90%+ of revenues. However, in terms of our investment into Europe, we've just very recently hired a head of business in Europe. He, in fact, joined us on 30th of June this year. We will continue to make substantial investments in Europe in the coming quarters to ramp up revenues from that region itself. Apart from that, our cash flows continue to be fairly healthy. In the current quarter, we've added about 103 people on a net basis, of which 84 people were campus hires. These are people that we've recruited from engineering colleges, and they are currently in the process of being put through training to be deployed on projects in the coming months. To summarize, we continue to witness good momentum. We in fact will continue to make investments in the coming quarters as well, both on the sales force side as well as bringing in domain expertise. We will, of course, continue to invest for growth and also pursue inorganic opportunities. That's another aspect that we are doubling down on. We are in fact intensifying our efforts to find attractive opportunities. In fact, on a couple of those opportunities, we are moving to a fairly advanced stage at this point in time, and we are hopeful that we will be able to deliver some news on the inorganic front as well in the coming quarters. Overall, a fairly healthy growth as well as margin profile for the current quarter. As management, we continue to remain fairly bullish on the industry as well as our growth prospects. With that, I'll hand it back to the operator, and we can open the floor for Q&A. Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question may 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 handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vimal Gohil from Alchemy Capital Management. Yeah, thank you for the opportunity. Sir, I just have one question. I mean, most of the other questions, you've already answered in your opening comments. Just on the sequential softness, I mean, assuming that you don't have a lot of seasonality to be seen within quarters. Any comments on the sequential softness during the quarter? Because if I were to sort of take your dollar revenue, they're almost sort of flattish, while the year-over-year growth still looks very good. What explains the sequential softness in revenue? Yeah. Let me take that. Raj, you can add in on the exceptional item that we had last quarter. We don't have too much of seasonality. Sometimes we see a little bit of softness in Q3 if budgets are winding down. Our Q3 tends to be the last quarter for clients in the U.S. Sometimes we have also seen a spike because they have money left to spend and then pick it up. Overall, I wouldn't attribute any seasonality. One thing that we are seeing is that we are pursuing larger opportunities and larger deals, and we've been able to elevate the conversations to more senior stakeholders within the target organization. Some of these conversations, given that they are at least $ half a million or more in size, they are taking a little longer as well, given that procurement organizations also get involved. There is a little longer gestation period that we see. When we close the deals, we are able to close them at a higher ticket size. Partly that change is happening in the environment, and that reflects a bit of the softness in Q2. There is also a point in relation to an exceptional item that we had in Q4. Raj, maybe you can touch upon that. Yeah. It was not something substantial, but this was more of an account that we had for the last year, which I think there was due to the recessionary trend that the retail sector was witnessing. This was their account that decided to sort of I would say close the analytics initiatives that they were giving us. Therefore, there was a one-time settlement sort of an income that was booked in Q4 of last year. Not fairly significant. Adjusting for that, the dollar growth even if you adjust for that one-time item, the dollar growth even in the current quarter on continuing basis would have been closer to about 4.4%+. That is what is resulting in a slight bit of softness when you see in Q1 of current year compared to Q4 of last year. Overall, like I mentioned, and what Rajan also mentioned is a few of the deal sizes that we are currently pursuing, we've seen a big uptick in the deal sizes itself. Some of those deals that we expected to close in the current quarter, there has been a slight push and some of those, we've not been able to win. Some of the deals that we were able to close as well, we were not able to book the full revenue because we were able to realize only one month revenue in the current quarter. This will all come into the revenue book in the following quarter. Some shifting of deals happened, a small bit of softness in Q1 compared to Q4. Right. Just one clarification, Raj. This 4% is reported number, right? Or constant currency, how would you want us to look at it? No, the 4% is adjusting for that one time item. Yeah, yeah. This will be reported right, not in constant currency. No, this will be in dollar terms. Okay. Okay. Fair enough. My next question was on margin. If you could just help us probably break down the 150 basis points hit that we have had, or if you also want to look at it YOY, there's about a 200 basis point hit. If you can break it down, what how much of it has come because of wage hikes or higher investments? How much of it has come because of on-site shift or offsite shift or whatever? If you can just break that up for us, please. I'll give you a high-level breakup of how the margin has moved from 30.6% to 20.9%. Roughly about 3%-3.5% of that impact came from wage increments, plus a combination of the fact that I told you that we do campus hiring, which starts in Q1. But a lot of these people are typically not engaged on projects straight away, and therefore there is a training period that they are put through before which they get billable, right? And the cumulative impact of that is about 3%-3.5%. But on the, The other, there's also a 1% impact on account of all the investments that we are making in the front end in terms of the sales force. That is an aspect that also led to a margin sort of downward trend. This was compensated by one, we negotiate better commercials and better rates. In fact, some of the newer conversations that we're having with or even a conversation that we're having with existing clients when we are renewing some of our contracts, we're able to get better realization, and we're able to drive up our rates. That plus some amount of saving on the SG&A itself, where we saw a slightly lower visa spend for Q1 compared to Q4. Q4 had a higher impact of visa spends, but Q1 had a relatively lesser number. The positive impact from both these two items that I spoke about is about 2%. The 3.5% impact from base as well as the investment in the front-end sales team was compensated by lower visa costs as well as better realization that we were able to get in the current quarter. I was hoping to hear incremental contribution from consulting to be on the positive side of the margin, given the fact that our margins over there could be better than the company average. You also said that you know, consulting typically has better margins. How should we read that going forward? So the consulting- Sorry, Raj, let me just give the qualitative perspective, and then you can give the quantitative. Yeah. Consulting work, in general tends to be, a higher margin because we also deploy, more seasoned, experienced people, right, on those engagements. They tend to be short intensive affairs, but creating, you know, the roadmap and, you know, the strategy for the organization. We are expecting that more of our clients, and prospects, there will be a need for those kind of consulting conversations. Even on the most recent trip, that I was on, at least 60%-70% of the conversations were around, how is the analytics capability in that organization set up, right? Does it have the right focus, strategy? Does it have the right set of capabilities? How are they engaging with the business sponsors and stakeholders? Therefore, how should they be configuring it so that they can deliver the necessary impact? I'm expecting that most engagements going forward, there will be a consulting component, especially more so in the non-tech space, whether it is BFSI or retail or CPG or industrials, and some in the fintech and tech space as well. We are expecting that that'll therefore contribute. However, the size of these consulting pieces of work itself is fairly small in comparison to the rest of the work that we do. While, therefore, the margins might be better there, it is only to the tune of about 10%-15% of the work. You'll have to take it with that perspective. Understood, sir. Thank you so much. I just have one last question, really? Sorry to interrupt. Mr. Gohil, may I request you to come to the question queue for any follow-up questions? Sure. Thanks. Thank you. The next question is from the line of Karan Uppal from PhillipCapital India. Please go ahead. Yeah. Thanks. Thanks for the opportunity. I have a couple of questions. Starting with the high-level question on macros. You mentioned that one of your clients in the retail vertical has, you know, canceled their analytics initiative. What is the outlook on the overall other verticals as well as retail itself? Are you seeing this trend getting developed in their analytics practice, in client analytics practice? The point about the particular client deciding to scale back, that was not even in the last quarter. That decision call was taken by them probably in June, July of last year. Okay? The only thing is that it played out over a period of time, and then eventually that settlement that Raj referred to happened in Q4 of last year. It was unrelated to the macroeconomic scenario. They just decided to go in a different direction, right, in terms of what they wanted to do with their analytics capability and then how they create it. Coming to the current macroeconomic scenario, we're not seeing any particular softness yet in the retail sector. Our conversations with clients in retail, as well as in other sectors, they are continuing along the lines that we had initiated even prior to the current macroeconomic concerns coming up, right? Be it the inflation or consumer spending or the ongoing war, right, in Ukraine. The conversations are going on. The only thing we see is that the closure is taking a little longer. As I said, we attribute it more to the size and the complexity of the conversation and the fact that in many instances there are more layers of approvals, including procurement coming into the picture. I don't see that as a sign of macroeconomic influence. However, we do want to watch this carefully. Conversations are going on, but at some point, clients could potentially decide, right, to focus their investments on the most important initiatives. What we are endeavoring to do and something that we have in our control is that the value propositions that we are taking to the table are directly in relation to either revenue enhancement or cost control, so that it directly helps the clients do more with less, even if there are cutbacks in the analytics budget. That is how we are positioning the current going in value propositions as well as the ideas that we are taking to market. At this time, overall, I would say that we don't see any cause for concern yet, and we maintain a cautiously optimistic outlook in terms of spending that will continue, right, on data analytics. Right. Sir, just a follow-up to that. You mentioned that some of those, you know, deals are taking a little bit longer. In that context, given that analytics itself is growing at 20% kind of a CAGR run rate. Shall we assume that Latent View would be able to meet that kind of a benchmark, or do you think that you will be lagging behind? You have seen the growth rates that we had in the last fiscal, where we were able to outperform that industry average that you just talked about. We believe that, given the strong value propositions that we are able to take to the table, we will able to maintain a similar outperformance trend in relation to the industry growth rate for this fiscal also. Okay, sir. Thanks. Thanks a lot for that clarification. Just last question is on margins. Margins, you highlighted that, investment and wage hikes impacted the margins this quarter. I just want to get a medium-term outlook in terms of the investments. Will these investments continue for the rest of the year? If yes, then, what should be the medium-term outlook on the margins front, given the supply side pressures as well as, you are investing a lot? Yeah. No, we will continue with the investments. I mean, I mentioned in my opening comments that, where we are currently landing on the EBITDA and the margins is well above, the planned 26%-28%, right? This is something that we've indicated on previous calls as well. We are doing, much better than that. As indicated earlier, any supernormal margins we will want to take and plow it back into the business. That is a philosophy that we will, that we are sticking to, we will continue to stick to. We don't see any reason for any pullback on investments at this time. We will continue to deliver on the EBITDA range that we have in mind, and we will be able to make the investments. Mr. Uppal, may we request you to come to the question queue for any follow-up questions. The next question is from the line of Krishna Thakker from Anand Rathi. Hello, sir. Am I audible? Yeah, we can hear you. Yeah. Thank you for the opportunity. I know you spoke a little about retail. Going forward sequentially, should we expect it to start moving up, the retail vertical? Yeah, Krishna. The sectors that we are really doubling down on, they are BFSI and what we call consumer. Consumer is a combination of retail and the consumer products verticals. These are sectors where we are also doubling down, right, in terms of the investment. We hired a business head for the retail practice who joined us in Q1. We also have made substantial investments in the BFSI vertical as well, right, even over the course of the last year, and we are continuing to do that. Out of the three new additions, logo additions that we had in Q1, two of them are actually in the BFSI vertical. We are expecting that there will be continued traction in terms of growth in BFSI as well as in consumer, which is combination of retail and CPG, into the coming quarter. Over 4-6 quarter kind of a time frame, I expect that BFSI and retail and CPG's contribution to the overall revenue key will continue to increase. Sure. Thank you so much for the color. Regarding the conversations with clients, sorry for asking this again, but I want to know some more, like if you could provide some more detail. Are they talking about CY 2023 or FY 2024? Are there any indications as to what the budgets could look like or is there any pullback? No pullback. I mean, obviously, some of the conversations that we are having are in relation to the current calendar year. In the U.S. most clients, their fiscal year is also the calendar year. Of course, there are some exceptions to that. The conversations that are currently underway, they pertain to initiatives that they can kick off in the current calendar year itself. Some of these will also spill over, right, into the next calendar year for them and fiscal year for them, right? We are also having conversations in relation to what they should be doing over the next two-year time frame. The consulting work that we are doing, where we are talking about the strategy and the roadmap, it is not limited to just what they can do in the current fiscal or calendar year. It is more about setting up a book of initiatives that they need to execute over the next two, three years. If indications that we see in the consulting conversations are anything to go by, I would say that most clients are fairly keen, right, to get this underway. There was a little bit of this euphoria around getting on to digital transformation and analytics initiatives last year with everybody trying to kick off something or the other. What I see now is a little bit of that rethink that we should be more thoughtful in terms of what we do, and therefore we should be considered in terms of how do we set up our analytics capability, what should be the strategy and what should be the set of initiatives. Which is a good sign because they get people like us involved in those conversations. We can help them think through that. It also creates more visibility for us in terms of the work that is likely to follow through, right, on the back of the consulting engagements. Understood. My last question is regarding attrition. I know our employee mix is different. than rest of the IT services. If you could throw some light on attrition, that would be great. Yeah. Attrition shot up for us as well, like any other IT services and especially the ones who are focused on the digital and data analytics space. Last year was really abnormal in terms of attrition crossing 30%, right? And 35%. Since then, it has trended down. Q2 of last year was the worst, but it has trended down on quarter-on-quarter basis. Right now for the last quarter and for this quarter as well, we are actually at attrition levels that are pre-pandemic, like better than even pre-pandemic pandemic levels. Now, of course, it is a combination of many things. I think the demand for analytics professionals continues to be fairly strong in the market, whether it is pure play firms like us or whether it is analytics capabilities of other larger organizations, products and startups, or whether it is GCCs, right, that are also hiring analytics people. I think the demand environment is still strong, and that is kind of reflected in the realization rates and the number of candidates that we need to interview, right, and make offers to, right, for getting what we need. Having said that, I think we have done a bunch of things to help improve employee engagement and manage attrition. One very good thing that we were able to roll out was an ESOP plan, which covered over one-third of our people prior to the IPO. That is helping at least with all the more tenured people, right? The attrition levels are quite low compared to even pre-pandemic levels. We also had several compensation revisions in the last 18-month period, and that has helped us benchmark and bring our compensation levels right to the right numbers. These things are contributing. I mean, that coupled with the fact that we do fairly interesting work that challenges our people and gets them to learn and develop new skills, that is all helping. This is a fairly high demand space. Attrition levels are definitely higher even in comparison to normal IT industry standards. How we plan to tackle that is more through the campus hiring right that I and Raj mentioned earlier. We bring in people from engineering as well as postgraduate campus, and then we engage them through our L&D programs and upskilling programs. There is greater stickiness there. That is the way we are looking to handle attrition. I mean, at this point in time, it is below the pre-pandemic levels and levels that which we are used to and we are comfortable dealing with. Sure. That's it from my side. Thank you. Yeah, sure. Thank you. A reminder to all participants, you may enter star and one to ask a question. The next question is from the line of Dev from Invest Yadnya. Please go ahead. Hello. Am I audible? Yeah, Dev, go ahead. Yeah. Yeah. I wanted to ask a question about. You said the digital transformation is a multi-year journey, right? The digital wave is already progressing. These large IT services companies, they also I mean data and then analytics is a part of their offering, and they are very skilled at that. How different is your product offering as compared to them? Because clients, they do not have to go for each and every thing to other vendors, right? They consolidate most of their offerings. What is the trend do you see here, and how are you differentiating with respect to them? Yeah, sure. We offer bespoke consulting services, right? From a data analytics standpoint. Much of the work that we do involves solving fuzzy, ill-defined problems where there is a good mix of three very important skill sets. There is a deep domain understanding that is needed, right? About the industry, about the functional value chain area. There is the math and modeling expertise that is needed. Then there is finally the technology skill sets that are needed. Different organizations approach this from their own vantage points. I mean, there are strategy consulting firms which come in more with a business perspective and domain expertise. There are IT services organizations and systems integrators that come more from a technology perspective. You also have product companies, as you mentioned, right? What we bring as a differentiator is a very important and unique blend of all of these three skills. Personally, I come from management consulting and a business consulting background, right, having worked with Accenture for two decades. I can say in all honesty that my first 15- years as a strategy business consulting, where we are solving problems around operational improvement, revenue enhancement, supply chain optimization, churn management, right? These are all problems that we earlier solved using pen and paper and Excel, doing back-of-the-envelope cost benefit calculations. We are able to do all of these things with the power of data and analytics today. It is the same set of challenging, complex problems where there is enough work that needs to be done in terms of defining the issue tree, breaking down a complex, fuzzy problem into component parts, setting up the hypothesis, figuring out what data needs to be analyzed, how do you collect the data. It's a combination of all of these things, right, that needs to be brought to the table. We believe that we bring that unique mix of capabilities, right, in a very impactful manner, and we understand the business imperatives and the business objectives, so much so that every piece of work that we do, we actually have a service delivery excellence models that measures the impact that we are creating, right, in dollar terms, either on revenue enhancement or cost control. That's what appeals to the client audience that we work with. We also work with the functional heads in most organizations as opposed to the CIO, CTO organization. The functional heads are the ones that are trying to solve these business problems. In general, our approach and model resonates with them more as opposed to what a very large IT organization will bring to the table. Larger organizations are focused more on the bigger re-platforming, ERP implementation, application maintenance kind of engagements, and their capabilities with respect to what we do is still fledgling at best. I mean, you see large organizations, even like an Accenture, acquiring smaller data analytics companies to build these kind of capabilities. We believe that we are in a fairly good place in terms of what we bring to the table and the type of problems that we go after. I have one more question. Can you tell me what are the types of clients in your technology vertical? Because it is, most of your share of revenues come from this vertical. Right. We work with tech companies, which are into products, services, hardware, devices, which offer their products and services in a license model as well as in an as-a-subscription model. We also work with e-commerce firms, platforms, fintech companies, right? That's the broad mix. Just as an indication, I mean, right now, we work with all the top five tech companies in the world. Five out of the top five are clients at this time. We work with a fairly large number of those tech companies based out of the Silicon Valley and the Bay Area. Okay. Thank you. Thank you. Yeah, sure. Thank you. The next question is from the line of Saurabh Sadhwani from Sahasrar Capital. Please go ahead. Hi. Thank you for the opportunity. Can you please elaborate on the partnerships that you mentioned about IBM and Neo4j? What exactly is the nature, and how do you see revenue changing because of these partnerships? Right. Sure. The partnerships with IBM and Neo4j are the latest in the fold. We have partnerships with the likes of AWS and Redshift, with Microsoft Azure and the Power Platform, also with Snowflake. There are a whole host of other technology tools that are there, right, that are used in this space. You know, starting with visualization capabilities, you know, like a Looker, Tableau, QlikView and so on. We have had what we call as technical partnerships with many of them, where we get access to the sandbox environment, we get access to early release material, learning environment, certification capabilities and so on. To some extent, access to their technical architects and designers and so on, right, in terms of figuring out how to solution for our clients. Some of these we have been able to graduate into a more go-to-market partnership. The one that is most advanced there is Snowflake, where we are just at the tier, which is one below the highest tier possible. What this means is that we go to market jointly. They take us into opportunities that they are pursuing and introduce us as the Snowflake implementation partner. We are also able to bring them into the picture where the client is contemplating a new cloud solution, right? Where they're building a layer, a data layer, for example. We have been able to win some partnership referral revenue, right, from Snowflake, for example, right, on the back of that. What we are attempting at IBM and Neo4j is along similar lines, where it is not just a technical partnership, but it also includes a go-to-market component. IBM has put together a very interesting cloud data tech stack, which is a mix of IBM's proprietary components, but also allows you to plug and play open source as well as other competing components, right, into the tech stack. They are pretty active in the India market. This is a relationship and a conversation that we began with their India team, and they are now starting to take us into Indian clients, especially in the BFSI space, where they see opportunities for further enhancing the usage of their tech stack, but they need to demonstrate the power of that tech stack and what it can do by partnering with an analytics service provider like us. Similarly, on Neo4j, it's more around their graph database capabilities. Graph database is starting to assume prominence in terms of how we can solve more complex problems, where the relationships between the different aspects of the problem are non-linear in nature. We have modeled a few problems using the Neo4j technology, right, what they bring to the table. We see that as something interesting that can be taken to the table to solve newer fuzzy problems, but also solve older problems, right, in a more appropriate fashion because of the non-linear nature of the interrelationships. In both these, the intention would be to have a go-to-market component, right, where we are able to take them in, where they have the appropriate solution, and they are able to bring us in as the implementation partner in case they sell their services to a client. Okay, you said Snowflake is in the second best tier. What would be better than this? Like, what is the next tier? I said, in Snowflake, we are at the second highest tier possible. Snowflake is the most advanced for us in terms of the partnership model that we have. Snowflake is also the one partner from where we have had referral revenues, where they pay us a referral for introducing them, right, into our accounts from a go-to-market perspective. Snowflake has four tiers of partnership. We are at the Yes, yes. We are at the one but the topmost tier, right? We are expecting to be in the topmost tier in a couple of months. Thank you. That's all from my side. Yeah, sure. Thank you. The next question is from the line of Akshay Kothari from Envision Capital. Please go ahead. Yeah, thanks for the opportunity. What will be our revenue from the 30 Fortune 500 clients which we are having? Raj, do you wanna take that? I think it'll be fairly high. I mean, the work, I would imagine that it is of the order of like 70% of the revenue or probably even higher. Raj, you will probably have the exact numbers. Yeah. I don't have the exact number handy with me at this point in time, but it'll be of the order of magnitude that you spoke about, Rajan. About 70%+ should be revenue from Fortune. If anything, actually it will be even higher, more like 75%-80% is my number, but I don't have that number straightaway handy with me right now. Okay. Is there any room for growth in this Fortune 500 clients? Because I think the competitors are already having and the SI companies are already having a large share of these clients. Is there any room for growth? That's the question. Absolutely. I mean, there is opportunity for growth not only in the existing Fortune 500 clients that we work with, but we can actually open up a lot more of the Fortune 500 companies as well. As I said, all of these guys, right, all of these Fortune 500 companies, they have an ecosystem of partners and service providers that they work with. They will be working with the large strategy consulting firms. They'll be working with several systems integration firms. They'll be working with other niche product companies. But as I pointed out earlier, the blend of skills that we bring to the table and the kind of problems that we are able to solve using data and analytics is what differentiates us. We believe that there is enough scope for growth, not only in the existing accounts, but also in opening up more Fortune 500 companies. As we speak, at any point in time, we'll be in discussion at least with two dozen companies, right, which we are targeting, and we'll keep adding to the base of Fortune 500 companies that we work with. Okay, that's great. Sir, lastly, you did mention that you were giving consulting services for startups, wherein you were going to set up an analytics division. Isn't it like cannibalizing our own revenue? Because I just wanted to understand what would be since data analytics is such an important tool in nowadays of internet age and, you know, everything surrounding around data. How difficult it is for company to set up or build their own data analytics division and take your help rather than outsourcing it to you? What would be the unit economics or something like that, which you would like to share? Yeah. I mean, to address the first part of your question, it is not exactly cannibalizing. I mean, many of these organizations that are looking to us for a strategy, an analytics strategy consulting kind of an exercise, they also fully realize that their own maturity, right, in terms of understanding the spectrum, the art of the possible, within the analytics space is limited. That is why they turn to somebody like us. In many of these instances, we find that once we complete the strategy and the road mapping exercise, there are several initiatives that emerge from that where they need our help and assistance. Of course, some of them they could potentially decide to do it on their own. They could work even with a different partner or they might use an automated commercial off-the-shelf solution that is available. That is okay with us because we want to give the best advice possible to these organizations. In the long term, right, I mean, these are large organizations, Fortune 500 companies, and these are big ones. The idea is that if you are helping them think through the strategy and the roadmap that we get a seat at the high table, we get early view into what is it that these organizations are looking to accomplish and what can they accomplish, and therefore we get involved in several initiatives downstream. I can say that in the two, three exercises that are currently underway, we do see a fairly long stream of initiatives emerging from the consulting exercise in which we will get involved. We are not particularly worried about whether an organization will be able to build an internal capability. This is a very dynamic space, Akshay. That is the other point. It is hard for any organization to actually acquire, build, and retain the kind of talent that is necessary to capitalize on the latest and greatest that is happening in the space. That coupled with what we can bring to the table in terms of cross-pollination, approaches that other organizations are using, and the expertise to address them from a analytics perspective, that is what is important. There is a lot of value in that which organizations realize. We are comfortable helping these organizations on the consulting front, and we do see a good stream of work emerging from those exercises. Okay. That's great, sir. That answers my question. Thanks a lot, and all the best. Thanks, Akshay. Thank you. The next question is from the line of Karan Uppal from PhillipCapital India. Please go ahead. Yeah. Just one clarification to start with. Your top 6-20 clients have been dropped. Is it related to that, your retail vertical client? Sorry, Karan, I couldn't hear the question clearly. Can you repeat? Yeah. I was saying that your top 6- 20 clients have dropped on a sequential basis. Is it related to the retail vertical side? No, no, it is not related to that. I think that will just be a change in the mix of revenue that we will probably be getting. You're talking about how much revenue contribution is coming from the next 6-20 clients, right? Not the top five. The top six. Yeah. 6-20, yes. Correct. Yeah. I think the top five, they have accelerated even more. Yeah. In the last quarter in particular. I mean, our number two client has now become our number one client. Actually, yeah, number two client has become number one client because they have actually grown dramatically in the last quarter, right? The quantum of work that we are doing. So there has been a little bit of further acceleration in the growth in the top five clients. So that will be the main contribution. Raj, did I get that right or is there some other color you wanted to provide? That is correct. Our top five clients continue to have, you know, the share of their contribution has gone up even more, and that is to some extent showing up as lower contribution from the next bracket of clients. Next is on the TCV, if you can share any forward-looking deal pipeline or the deal wins which you have been in, just to, you know, help us understand overall in terms of the visibility. Yeah. We have not been putting out a deal pipeline or an order book so far. I think we need to mature a little bit more as a public company before we are able to offer guidance. I can share what has been the typical, right? I can say that it's actually improving, right, in comparison to the typical. Typically, at any point in time, for the fiscal, before when we start the fiscal, we have visibility into about 65% of what we are targeting as revenue for that year based on the confirmed statement of work that we have and the extensions, right, that we are anticipating at a very high probability. Typically, what happens is, over the course of the fiscal, based on the pipeline of fresh opportunities that we are chasing, they start converting. The extensions that we have at lower probability also, as we get closer to the extension date, they come through. I would say that we are getting better on that in terms of, we now see that the probability of renewal for many of the ongoing work is much better because in many of these instances, we have been working with the client for two years or longer. If you've been working with the client for two years or longer, generally, we don't see any kind of slippage happening unless the client takes a very dramatic decision, right, in terms of chopping down their, analytics, external outsourcing or deciding to do a different route or there's some major structural change in the organization. Those instances are very few. We don't see too many of that. One thing that we are seeing is that the probability of extension are getting, more certain, right, with, the passage of years. Second is, we also now see that, as I mentioned earlier, that, the deal pipeline itself comprises larger opportunities that we are going after. It is not as if we have a very long tail of very small opportunities, but instead, we are focusing on larger opportunities with the the select accounts, right, that we are pursuing. These probabilities also tend to improve, right, because of the focus that we are bringing on those opportunities. In general, I would say that the visibility that we have into the revenue goals that we have for the current year, it's been getting better over the last 2-3 quarters. Okay. Thanks a lot for the detailed answer. The last question is on the wage hikes. You mentioned that in Q1, you have already given the wage hikes. Is it the wage hike are done for fiscal 2023 or given the market situation you are expecting you will have to intervene again, maybe in H2? No, I think for this fiscal we are pretty much done. I mean, this is the normal wage hike we do in April as we start the new system. We were able to do the corrections that we deemed necessary based on the benchmarking that we did. At this point in time, I would say that we are done with the wage hikes for the current fiscal. We do not anticipate any further compensation adjustments within this fiscal. Also, there is a little bit of that demand stability, right? I mean, when I say demand stability, I mean like earlier last year was like completely euphoric and crazy with the attrition and renege. That has started tempering down, right? We don't believe that there'll be another correction that will be necessary during the course of this fiscal. Sure. Thanks. Thanks a lot and all the best for Q2. Thanks, Karan. Thank you. The next question is from the line of Chirag Kachhadiya from Ashika Institutional Equities. Please go ahead. Hello, sir. I have a few questions. Like, our 95% revenue is coming from USA and just 2% from Europe. Can you share like what plan with Europe continent going forward to increase the pie of revenue from there? Yeah. Point of view, I'm asking. Sure. Also on the client concentration side, our concentration among top five is very high. What strategy on same front and also strategy to increase the contribution of top 20 clients later on? Your remark on same. Yeah, sure. On Europe, the intention is to really double down and make the investments necessary to grow the practice. We already have subsidiaries in U.K., Germany and Netherlands, and we have a handful of accounts. We see prospects for growing the accounts where we are present in, but we also believe that Europe is looking for the same kind of value propositions and solutions, right, that we're able to bring to the table, right? What we have been doing in the U.S., we believe that there is enough opportunity in the European market as well. We haven't really focused on the Europe market in the past, but that is what we are changing, right, starting with this year. I mentioned that we have already hired a business head for Europe. In addition to that, we also hired a few more people on the sales and business development front and also on the delivery and the capability front here, right, offshore. We will continue to make those investments going forward. I expect that the traction in terms of starting to win the right kind of deals and opportunities in Europe will start coming through in a two-quarter time frame, right? I'm expecting that starting Q4 of this fiscal, we should start seeing some of that playing out, right, in terms of wins that we have in Europe and the uptick that we start seeing in revenues. The expectation is that over a three-year period, four-year period, that Europe will contribute about 15%-20% of our revenues, which is kind of in line with what you typically see in other IT services as well as in a digital space. That is the plan for Europe, and we'll make the investments necessary to grow the Europe practice to those kind of levels. If I go back to your other question on the client concentration, the intention is to, I mean, there are two, three things, okay, that should contribute to helping address the concentration. One is that we are aggressively pursuing several Fortune 500 companies as well as organizations that are very gung-ho, right, on using data analytics to drive their organization goals and business priorities. Which will mean that we will continue to add new accounts into the portfolio, and the focus is continuing to be on the large Fortune 500 companies and clients who can spend big on analytics. One of the things that we have done internally, for example, is that for our sales and business development front-end teams, deal incentives start kicking in only if the deal size is at least INR half a million, right, or more, which is the kind of deals that we want to pursue. We want to win more large logos, right, and accounts. We want to pursue bigger opportunities in those accounts as well. The combination of that, we believe will help us get a healthy mix of clients, which are at an appropriate size in terms of their revenue and contribution to help de-risk the client concentration that we see. Having said that, we are also very clear that we will pursue the growth opportunities that we have in our best accounts that we have so far. I did point out that, I mean, the top five, the opportunities are very high, and that is where we have the best relationships that we have built so far, right? That is the reason they are also in the top five. We will continue to aggressively pursue and exploit opportunities that we have there as well. Over a period of time, we are expecting that, as we add more Fortune 500 companies into the mix, as we add more companies which are spending big on analytics into the mix, the client concentration will start coming down. Thank you. Due to the paucity of time, we will take the last question from Krishna Thakker from Anand Rathi. Hello, sir. Thank you for the opportunity again. I know we maintain a bench of 15%-20%. Given that we had an intake of 100 odd employees this quarter, I was wondering if you could just share with us what the utilization was for this quarter. For the current quarter, I think we were at about 80%, 78%, 80% utilization. The bulk of the people have come on board from the campus in the last three, four weeks or so, right? Exactly. We are expecting that we will add more people. But we have restructured the L&D and the boot camp and the training programs to allow for some faster deployment into the projects while some of the learning and development happens in parallel, right? The capstone project and some of the other things. We are expecting that people will get pulled into productive billed work sooner than what we have experienced in the last fiscal, for example. In the last fiscal, I think we did have a fairly higher percentage of unbilled people in quarter two. I think it will go up in Q2 because of the additions that we are making in from a campus perspective, but we are also looking at how we can accelerate the deployment into productive work. So we'll know how this pans out in the coming weeks, right, as we implement that changes. Do we have any target for fresher hiring for the year? Yeah. For the current year, as in like people who will onboard us in this fiscal, I think we had a number of 250. We have onboarded already about 100 people from engineering campuses. We have onboarded also another 20 people or 25 people from business schools and postgraduate campuses. I think there'll be a few more left from postgraduate campuses. There is another 100 odd people who will be onboarding us from these campuses, okay? That is what we expect in the current fiscal. We might do some off-campus hiring depending on the demand scenario, right, on how much of an uptick we see in Q2, Q3, right, in terms of closures and demand. For the next fiscal, we have already kicked off the campus hiring program. These are offers that we will start making now, in September onward. Actually, we already started visiting campuses, but these people will join us only from May, June of 2023. They will actually come in only in the next fiscal. For the current fiscal, about 250 was the number, and I think that's what it'll be. Maybe we will do a round of off-campus, depending on the demand. Understood. Thank you so much, and best of luck for the rest of the year. Yeah, thanks. Thank you. I would now like to hand the conference over to the management for closing comments. Yeah. Hey, thanks, Jacob. The main thing I wanted to end with is that we are fairly confident about the traction and the resonance that our value propositions and solutions have in the marketplace. I'm especially happy with the recent roundtable event that we did where we had our advisors as well as clients and prospects attend and exchange a good set of ideas, right? That they can take back to their work in terms of implementing analytics solutions. Overall, I feel that the inflection point that we had talked about earlier, right, in terms of companies doubling down on their analytics initiatives is still in play. I also see that organizations are becoming more holistic and integrated in their thought process when it comes to analytics initiatives. Therefore, these initiatives will move from being fringe initiatives to becoming more mainstream and more central, right, to the execution of the organization's business strategy and goals. That augurs well, right, for us in terms of the full suite of capabilities that we bring to the table, right? Right from consulting strategy, data engineering, look back, look ahead analytics, right? That full capability suite is important for that holistic integrated approach that organizations are thinking about. It'll also mean that there'll be larger deals, longer- term deals and more stickiness as we go forward. Combination of all of that, I would say that we are confident about what is happening. Of course, we will continue to execute on building out the value propositions and the capabilities, making the investments that we need to make at the front end, right, in terms of both client servicing as well as sales and business development. Overall, I feel that we are on a good track here, and we will want to continue to execute well, right, in the remaining quarters as well. With that, I'll turn it over to Raj if he has any closing comments. No, Rajan. I think you pretty much covered everything. In summary, I think the one aspect that maybe I'll briefly touch upon is the fact that, of course, the current book of work that we're sitting on as well as the new conversations and pipeline that we're continuing to witness makes us believe that there is significant runway ahead of us. Which also gives us confidence as management to continue to make some of these investments in the front end as well as building out capabilities. And what we do believe is while the industry is poised for growth, at this moment, there are some early indicators of, say, recessionary trends or inflation in the U.S. We continue to be cautiously optimistic about the situation at this point in time, and we will continue to be bullish and make some of these investments in the front end. However, we will take a very calibrated view of how the market itself unfolds over a period of time. As the management of the company, we continue to remain fairly bullish. Thank you. On behalf of Latent View Analytics, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you all. Take care. Thank you.