Aurionpro Solutions Limited — Q2 FY26 earnings call

Call held 4 Nov 2025

Management summary

Aurionpro Solutions reported a robust Q2 FY26 with 29% YoY revenue growth and resilient margins, driven by strong new logo additions and strategic wins like the Mumbai Metro project. The company continues its aggressive investment in R&D (₹120 crore for FY26) and AI, expanding its global footprint, particularly in Europe, with initial deal wins. While H1 cash flows were negative due to project seasonality, management anticipates strong Q4 collections, maintaining its historical EBITDA-to-cash conversion.

Highlights

  • Revenue grew 29% year-on-year, maintaining a 30%+ annual growth rate for four consecutive years.

  • Added 19 new logos in Q2, bringing the first half tally to 35, the strongest new logo addition in company history.

  • The Mumbai Metro project win is the largest order win in the company's history for the TIG segment.

  • AI business is growing at 100% for the company, with significant investments in AI-native applications and foundational technology.

  • Days Sales Outstanding (DSOs) have improved to approximately 100 days from 110 days last year.

Concerns

  • Employee expenses have risen due to acquisitions and capacity building, though management expects normalization in organic growth.

  • Cash flows were negative in H1 due to project seasonality, with collections typically picking up in Q4.

  • Data Center margins are currently 5-6% below the company's overall EBITDA margin, though expected to improve as products mature.

Key financials

2 periods

Headline

  • Revenue Growth
    29%
    YoY +29%
  • DSOs
    100 days
  • AI Business Growth
    1%
    YoY +100%

H1

  • New Logos Added
    35

What they filed

Q1 FY27: revenue up 6.2%, net profit down 11.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue278 306 327 337 358 +29%371 +21%346 +6%358 +6%
EBITDA56 64 66 68 72 +29%75 +17%67 +2%61 −10%
Net profit46 48 51 51 56 +22%44 −8%61 +20%45 −12%
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.

Order book

high confidence

Total value

₹1,500 Cr

as of 2025-09-30 quantified

Execution

80% plus of the order book is typically executable over the next five to six quarters.

The Mumbai Metro project was the largest order win in company history, contributing significantly to the equipment and licensing piece in Q2.

Source: Q&A

Capital allocation

medium confidence
  • M&A Fenixys Acquisition · Closed

    Part of significant investments in Europe to build out team and infrastructure.

    We also did an acquisition in the form of Fenixys.

Guidance & targets

Revenue

  • FY26 Revenue Revenue · FY26 · Medium confidence ₹1,500 crore and ₹1,600 crore
    This year, probably something between Rs.1,500 crore and Rs.1,600 crore.

    — Ashish Rai

R&D Spend

  • FY26 R&D Budget R&D Spend · FY26 · Medium confidence ₹120 crore
    So, the R&D bucket this year is probably Rs. 120 crore, maybe slightly more than that and I think it will continue to increase.

    — Ashish Rai

Profitability

  • EBITDA Maximization Profitability · next few years · High confidence No intention to maximize
    We have no intention of going after EBITDA maximization anytime over the next few years.

    — Ashish Rai

Europe Expansion

  • Flywheel Operation Europe Expansion · next four quarters · Medium confidence Fully operational
    So, I think we are probably another four quarters away from the flywheel fully in operation.

    — Ashish Rai

FinTech Product

  • New Loan Servicing System Launch FinTech Product · next three months · Medium confidence Launched
    We are very close to coming up with a brand-new loan servicing system, probably out over the next three months.

    — Ashish Rai

  • UK SME Lender Solution Go-Live FinTech Product · next few weeks · Medium confidence Go-live
    we announced the win in the U.K. with an SME lender. I think we are probably just a few weeks from going live with it.

    — Ashish Rai

What to watch in Q3 FY26

Europe Market Expansion Progress

Next 4 quarters
Current 6 months into expansion, 4 quarters away from full flywheel operation
Target Progress towards full flywheel operation, more deal wins

Why it matters

Key to global expansion strategy and future revenue growth, validating significant investments.

I think we are six months into our expansion into Europe... I think we are probably another four quarters away from the flywheel fully in operation.

Risks & concerns

  • Longer gestation period for Europe expansion

    medium

    Sales cycles in new markets like Europe are 12-18 months, and the 'flywheel' effect is still four quarters away, implying delayed revenue realization.

    I think we are six months into our expansion into Europe... the sales cycle is 12 to 18 months... I think we are probably another four quarters away from the flywheel fully in operation.

    Management acknowledged

  • Lower margins in Data Center business

    medium

    Data Center margins are currently 5-6% below the company's overall EBITDA margin, though management expects improvement as products mature.

    the margin profile of data center is five to six percent below the enterprise or I mean below the company level EBITDA margin? Correct... But that will take some time for us to mature the products.

    Management acknowledged

  • Seasonality of cash flows

    low

    Cash flows are typically negative in the first half of the year due to project execution and billing milestones linked to client go-lives, with collections picking up in Q4.

    Just one last thing, like our cash flows for H1 were negative... But in the product business, that is the nature of the business... End of the year, you take the clients live and the collections pick up, right?

    Management acknowledged

Q&A highlights

8 direct
Europe and US market traction and strategy Direct
I think we are six months into our expansion into Europe. US is a more steady state... I think we are probably another four quarters away from the flywheel fully in operation.

Provides a timeline for expected returns from significant investments in new geographies.

Asked by Vinay Menon

Aurionpro's AI strategy and focus (Arya) Direct
There are three races you're trying to run. One is the AI native applications... Race number two is... building out a whole enterprise AI layer... Race number three is can we really create new foundational technology that allows banks... to take these models into production?

Clarifies the multi-pronged approach to AI, distinguishing between application, enterprise layer, and foundational research.

Asked by Vinay Menon

EBITDA maximization vs. growth and R&D investment Direct
We have no intention of going after EBITDA maximization anytime over the next few years... the R&D bucket this year is probably Rs. 120 crore, maybe slightly more than that and I think it will continue to increase.

Highlights management's strategic priority on growth and product development over short-term margin maximization, with a quantified R&D budget.

Asked by Vinay Menon

Seasonality of cash flows and collections Direct
typically for us, middle of the year, you are still executing projects. End of the year, you take the clients live and the collections pick up... I would say 75% to 80% or more EBITDA to cash by the time we finish the year.

Explains the recurring pattern of negative H1 cash flows and provides reassurance on annual cash conversion.

Asked by Vinay Menon

Data Center business growth and margin profile Direct
Data center is one of the big bets for us... growing very, very strongly, typically in the range of anywhere between I would say 35% and 50% any given year... the margin profile of data center is five to six percent below the enterprise or I mean below the company level EBITDA margin? Correct.

Quantifies growth and provides specific margin context for a key growth segment.

Asked by Deepak Poddar

Software services revenue movement and order book execution Direct
because of MMRDA, that equipment and licensing piece jumped quite a bit... 80% plus of the order book is typically executable over the next five to six quarters.

Explains quarterly variations in revenue mix and provides a clear timeline for order book execution.

Asked by Sunaina Chhabria

Rising employee expenses and normalization Direct
A lot of it is due to sort of absorption of that came through some acquisitions... I do not think it will go up at that same pace the next few quarters... organic growth wise, it will not be that much.

Addresses concerns about cost increases and provides an outlook on future employee expense trajectory.

Asked by Varun Gandhi

TIG segment's integrated approach and margin profile in transit Direct
we built out both the hardware and software stack... You are able to capture margins only when you have that integrated hardware-to-software play... We will drive a very different level of economics from this business.

Explains the strategic advantage and strong margin potential in the transit payment business due to end-to-end control.

Asked by Devashish

3 min read 7 chapters

Detailed narrative

Q2 FY26 Performance Overview and Growth Trajectory

Aurionpro Solutions reported a strong Q2 FY26 with revenue growing 29% year-on-year, maintaining resilient EBITDA and PAT margins. The company added 19 new logos in Q2, bringing the first-half tally to 35, marking its strongest new logo addition in history. Management highlighted a consistent 30%+ annual growth rate over the last four years, with FY26 revenue projected to be between ₹1,500 crore and ₹1,600 crore.

Strategic Investments in R&D and AI

Since its pivot four years ago, Aurionpro has invested over ₹1,000 crore in new product development and strategic acquisitions. The R&D budget for FY26 is projected at approximately ₹120 crore and is expected to increase. The company's AI strategy, driven by labs in Mumbai, Paris, and London, focuses on three key areas: AI-native applications, building an enterprise AI layer, and developing foundational technology for productionizing models, explainability, and observability. The AI business itself is growing at 100% for the company.

Banking & FinTech Segment Momentum

The Banking and FinTech segment saw a significant win with UCO Bank for its AI-led transaction banking platform, reinforcing Aurionpro's position in large financial institutions. The FinTech side is becoming increasingly material, with new product build-outs including a modern retail LO product and a brand-new loan servicing system expected within the next three months. The company also secured its first AI-led lending solution win in Europe, which is expected to go live in a few weeks.

Technology Innovation Group (TIG) Highlights

The TIG segment achieved its largest order win in history with the two phases of the Mumbai Metro project. Both the transit payments and data center businesses within TIG demonstrated strong growth in the first half of the year. The data center business, specializing in complex design and build management, is growing 35-50% year-on-year, though its margins are currently 5-6% below the company's overall EBITDA margin.

Global Expansion and Market Penetration

Aurionpro is actively pursuing expansion in Europe, with initial sales cycles of 12-18 months and the 'flywheel' effect anticipated to be fully operational in about four quarters. The company has secured significant transit payment wins globally, including in California (8-9 cities), Maldives (in partnership with MasterCard), America, Costa Rica, Ecuador, Mexico, Australia, and the UK, showcasing its integrated hardware-to-software capabilities and strategic partnerships.

Cash Flow Dynamics and Receivables Management

The company experienced negative cash flows in H1, which management attributes to project seasonality, with collections typically strengthening in Q4 as projects go live and billing milestones are met. Historically, Aurionpro converts 75-90% or more of its EBITDA to cash by year-end. Days Sales Outstanding (DSOs) have improved to approximately 100 days, down from 110 days last year.

Intangible Assets and Capitalization Policy

Aurionpro invests heavily in product build-outs, with most costs expensed rather than capitalized. Capitalization is primarily limited to the payments business, due to regulatory requirements and the need to show asset build-out, and the AI side, often involving government-funded agencies and grants. The company emphasizes its efficiency in product development, with minimal capitalization for larger products.

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