Alldigi Tech Limited — Q4 FY25 earnings call

Call held 11 Aug 2025

Management summary

Alldigi Tech reported a strong FY25, with revenue growing 16.4% and PAT surging 30.2%. The company successfully divested its LLC business, increased its international business share to 63%, and declared an interim dividend of Rs. 30 per share. Strategic focus remains on AI integration and capacity expansion, though sales and marketing costs saw a significant increase, and clarity on the Digitide merger is pending.

Highlights

  • Revenue grew 16.4% from Rs. 469.4 crores in FY24 to Rs. 546.3 crores in FY25, with growth at 23% excluding the LLC divestment.

  • PAT surged 30.2% from Rs. 64 crores in FY24 to Rs. 83 crores in FY25.

  • Operating cash flows stood strong at Rs. 118.5 crores from Rs. 90.8 crores, a 30.4% increase year on year basis.

  • The board declared an interim dividend of Rs. 30 per share on 30th July 2025.

  • International business share expanded by 6% from 57% in FY24 to 63% in FY25 across both BPM and T&D segments.

Concerns

  • Sales and marketing costs increased from Rs. 7 crores to Rs. 19 crores.

  • No status update or specific details provided regarding the potential merger with Digitide Solutions.

Key financials

  1. Revenue ₹546.3 Cr +16.4%YoY
  2. EBITDA ₹129 Cr +12.1%YoY
  3. PAT ₹83 Cr +30.2%YoY
  4. Operating Cash Flows ₹118.5 Cr +30.4%YoY
  5. Cash & Investments ₹160 Cr

What they filed

Q1 FY27: revenue up 4.2%, net profit up 20.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue131 139 146 144 147 +12%153 +10%155 +6%150 +4%
EBITDA31 32 35 37 36 +16%46 +44%44 +26%41 +11%
Net profit12 20 19 15 18 +50%21 +5%29 +53%18 +20%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Share of Revenue
₹546.1 Cr Total
  • Business Process Management (BPM) ₹412 Cr 75.4%
  • Tech & Digital (T&D) ₹134.1 Cr 24.6%

Capital allocation

high confidence
  • Dividend ₹30/share (interim)
    The board has declared an interim dividend of Rs. 30 per share on 30th July 2025, reflecting our continued commitment to delivering value to our shareholders.
  • M&A Labour Law Compliance (LLC) Business Divestment · Closed · Consideration ₹[object Object] (undisclosed)

    to allocate capital and our leadership attention to core growth areas.

    resulting in a gain of Rs.16.9 crores.

    In line with our strategy to sharpen business focus, we divested our Labour Law Compliance (LLC) Business to M/s. Aparajitha Corporate Services in Q1'25 for Rs. 22.1 crores resulting in a gain of Rs.16.9 crores.
  • Liquidity Cash ₹160 Cr
    We have Rs. 160 crores cash and investment on our books.

Guidance & targets

Margin

  • EBITDA Margin Growth Margin · year on year · Medium confidence up to about a 100 basis points
    so we continue to believe that we can continue to have a positive growth in the EBITDA of up to about a 100 basis points year on year, subject to, of course, any investments which we have to make to continue to support, the ambitious plan to keep up the top line growth.

    — Naozer Dalal

Revenue per Employee

  • Revenue per associate YoY improvement Revenue per Employee · going forward too · Medium confidence 5% to 6%
    we will continue to sort of see about a 5% to 6% improvement in the revenue per associate YoY, going forward too.

    — Naozer Dalal

Revenue

  • CXM/BPM Segment Growth Revenue · foreseeable future · Medium confidence strong double digit growth
    So with the three pronged strategy, we believe that we can continue to show a strong double digit growth in CXM in the foreseeable future.

    — Naozer Dalal

  • EXM/T&D Segment Growth Revenue · foreseeable future · Medium confidence double digit growth
    We believe that with all these initiatives, we should continue to see a double digit growth in the EXM segment too.

    — Naozer Dalal

  • Overall Business Growth Revenue · near future · Medium confidence double digit growth or mid to high teens
    What we can commit is that we would continue to see the growth which we have seen in the past which I mentioned in the previous question, double digit growth or mid to high teens in both the segments and we do not see a challenge in achieving that into the near future.

    — Naozer Dalal

What to watch in Q1 FY26

Clarity on corporate cost sharing from Digitide

next quarter
Current continue to evolve, remain work in progress
Target Specific numbers or clarity on allocation

Why it matters

To understand the financial impact of the new corporate structure on Alldigi's expenses and overall profitability.

these continue to evolve, these remain work in progress. So difficult for me to mention a specific number and as and when we get better clarity, these will be reported in our financial status.

Risks & concerns

  • Impact of AI and automation on business segments

    medium

    Management recognizes the threat but is actively infusing AI into BPM and T&D offerings to enhance services and improve efficiency.

    Analyst acknowledged

Q&A highlights

5 direct, 1 evasive
CXM/BPM growth strategy post-Digitide integration Direct
Wider Digitide ecosystem enables us to have a lot more feet on street in terms of onshore US sales... Infuse a lot more of artificial intelligence in the newer proposals... sales individuals in the US... also selling Alldigi VPN services.

Clarifies how the new Digitide structure will support growth in the core BPM business, emphasizing AI integration and cross-selling opportunities.

Asked by Raghuram N S

EXM/Tech & Digital business outlook and strategy for 2-3 years Direct
Greater international footprint. Our focus on multi country payroll continues... acceleration of sales partnerships... new business segment, a new customer segment in terms of the Buzzily product which we have launched for the, particularly for the SME space.

Details specific initiatives to accelerate growth in the T&D segment, including international expansion, strategic partnerships, and new product launches like Buzzily.

Asked by Raghuram N S

Corporate cost sharing between Digitide and Alldigi Partial
these continue to evolve, these remain work in progress. So difficult for me to mention a specific number and as and when we get better clarity, these will be reported in our financial status.

Indicates uncertainty or lack of finalization regarding the financial impact of the new corporate structure on Alldigi's expenses, which is a key financial consideration.

Asked by Raghuram N S

Outlook for FY26 and FY27 top line, bottom line, and steady-state EBITDA margins Partial
What we can commit is that we would continue to see the growth which we have seen in the past which I mentioned in the previous question, double digit growth or mid to high teens in both the segments and we do not see a challenge in achieving that into the near future.

Provides a qualitative growth outlook for the segments and overall business, referencing market research and past performance, but lacks specific numerical guidance for future years.

Asked by Keshav Garg

Decline in EXM domestic business in FY25 Direct
as you're aware, we divested the LLC business and after adjusting for that divestment, the EXM business also has grown actually by 10.5% percent over the previous financial year.

Clarifies that the perceived decline was due to a divestment, and the underlying EXM domestic business actually grew significantly, correcting a potential misinterpretation.

Asked by Keshav Garg

Utilization of Rs. 160 crores cash on books Direct
interim dividend has been announced by the Board on 30th of July... balanced approach where we try to increase the shareholder value by offering dividend... funds required for working capital arrangements, capital investments, as well as inorganic growth, if any.

Explains the company's capital allocation philosophy, balancing shareholder returns, operational needs, and growth opportunities, providing insight into future cash deployment.

Asked by Keshav Garg

Threat of AI and automation on business segments Direct
we fully recognize it. We have been as mentioned, we are now infusing AI into all our solutions on the BPM side to add value to customers and give us cost efficiencies. On the T&D side, we have a program to infuse Al into our existing offerings...

Acknowledges the AI disruption risk but highlights proactive integration of AI into their offerings to enhance value and efficiency, demonstrating a strategic response to technological change.

Asked by Keshav Garg

Plans to merge with Digitide Solutions Evasive
at the current moment there is no status update on this and as and when we get to know something more we will share that appropriately.

Indicates that while Alldigi is a subsidiary, a full merger is not confirmed or details are not ready for disclosure, creating uncertainty about the company's long-term corporate structure.

Asked by Keshav Garg

2 min read 6 chapters

Detailed narrative

Strong Financial Performance in FY25

Alldigi Tech reported a robust financial year 2025, with revenue growing 16.4% from Rs. 469.4 crores in FY24 to Rs. 546.3 crores in FY25. Excluding the LLC divestment, growth stood at 23%. PAT surged 30.2% from Rs. 64 crores in FY24 to Rs. 83 crores in FY25, while operating cash flows increased 30.4% YoY to Rs. 118.5 crores, demonstrating strong operational efficiency and cash generation.

Strategic Restructuring and Divestment

The company underwent significant strategic restructuring, becoming a subsidiary of Digitide Solutions Limited from April 1, 2025, following a three-way demerger from Quess Corp. This transition aims to sharpen strategic focus and expand access to global markets. Additionally, Alldigi divested its Labour Law Compliance (LLC) Business for Rs. 22.1 crores in Q1'25, resulting in a gain of Rs. 16.9 crores, to concentrate on core growth areas.

Segment Renaming and International Business Expansion

Customer Experience Management (CXM) was renamed Business Process Management (BPM), and the EXM payroll business was renamed Technology & Digital (T&D), aligning with AI-enabled tech offerings and the holding company's structure. The share of international business significantly increased by 6% from 57% in FY24 to 63% in FY25 across both BPM and T&D segments, contributing to better margins and global market relevance.

Growth Drivers in BPM and T&D Segments

The BPM segment delivered Rs. 412 crores in revenue in FY25, growing 18.5% YoY, with 73% originating from international markets. Growth was driven by new strategic accounts, AI-powered capabilities, and an NPS of 81. The T&D segment, generating Rs. 134.1 crores from core payroll operations, is expanding its international footprint, accelerating sales partnerships, and launching new products like Buzzily for SMEs, which has already onboarded 27+ customers in six months.

Capital Allocation and Shareholder Returns

Alldigi Tech declared an interim dividend of Rs. 30 per share on July 30, 2025, reflecting its commitment to delivering value to shareholders. With Rs. 160 crores in cash and investments on its books, management outlined a balanced approach to capital allocation, prioritizing shareholder returns through dividends, working capital requirements, capital investments, and potential inorganic growth opportunities, with new projects focusing on AI and automation.

AI Integration and Future Outlook

The company is actively infusing AI into both its BPM and T&D solutions to enhance value, improve cost efficiencies, and address the threat of automation, with programs for chat-bots, reimbursement, and tax recon. Management expressed confidence in achieving 'double digit growth or mid to high teens' in both segments in the near future, targeting 'up to about a 100 basis points year on year' positive growth in EBITDA, subject to necessary investments.

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