DELAPLEX

Delaplex delivered solid financial results for H1 FY26, with consolidated revenue growing 5% year-on-year to INR 390 million from INR 373 million in H1FY25. EBITDA increased 13% to INR 92 million from INR 81 million, and PAT also rose 13% to INR 72 million from INR 64 million. This performance was underpinned by significant margin expansion, with EBITDA margin improving by 172 basis points to 23.5% and PAT margin by 132 basis points to 18.4%. The company attributes this to focused execution and strong operational performance.

The Blueberry Systems acquisition in the UK contributed INR 9.21 crores in revenue and INR 2.35 crores in PAT during H1 FY26, enhancing service delivery with AI-enabled low-code platforms and providing access to European markets. The Celestia Crew Consultancy acquisition improved delivery efficiency, particularly in supply chain consulting, and contributed approximately 2% to revenue. A new solutioning business, including micro data centers and enterprise solutions, emerged as a significant new revenue stream, contributing 16% to total revenue, entirely from new clients.

Delaplex is actively progressing with paid proof-of-concepts for its edge micro datacenters with PSUs and enterprise clients, expecting significant conversions to full-scale deployments in H2 FY26. The company has invested in four micro data centers (two in Hyderabad and two in other states) and aims for this business to contribute 34-40% of its EBITDA in the short run. This initiative, alongside the BSNL partnership, positions Delaplex in the rapidly growing edge computing market, projected to reach USD3 billion by 2033.

Management acknowledged the global turmoil and increased client consciousness towards value-driven spending. Delaplex is adapting by leveraging its low-code platform, new edge technology, and cross-skilling initiatives to deliver better value and maintain operational efficiency. This approach has allowed the company to achieve a 9% reduction in employee costs without layoffs, by optimizing resource utilization and upskilling existing team members.

The standalone business experienced a 400 basis point margin drop, primarily due to ESOP expenses for 1,21,800 shares allocated this year and initial costs associated with the new micro data center solutioning. Management clarified that this is an initial ESOP, with future dilution spread over four years (40% in the first year, then 15% annually for the next four years). Intangible assets of approximately INR 2.5 crores were recorded, mainly related to goodwill from the Blueberry acquisition and investments in AI-enabled platforms and project tracking tools.

Delaplex anticipates H2 FY26 to be stronger than H1, aligning with historical seasonal patterns where H2 typically contributes 55-60% of annual revenues, compared to H1's 40-45%. This pattern is largely driven by budget approvals and new project agreements materializing from January onwards in the US market, which is Delaplex's largest geography. The micro datacenter and solutioning businesses are expected to be key growth drivers for H2, contributing meaningfully to the second half performance.