Dev Information

DevIT is strategically prioritizing the India market for sustainability amidst global geopolitical turbulence, despite its lower margins. The company aims to create high-value assets and intellectual properties, drawing parallels to the success of DevX. This approach is expected to yield significant future returns, validating the current investment-heavy phase.

For Q2 FY26, consolidated total income saw a modest increase to ₹49.18 crores (up 1.95% YoY), while EBITDA declined significantly to ₹3.82 crores (down 66% YoY). However, net profit surged to ₹71.88 crores, primarily driven by an exceptional gain^📎 of ₹93.55 crores from the revaluation of DevX shares post-public issue. H1 FY26 reported a 10.32% YoY growth in total income to ₹92.64 crores, but EBITDA for the half-year also fell to ₹7.85 crores.

The company is making substantial investments in cutting-edge technologies, planning to allocate ₹7-12 crores for AI and blockchain R&D, and an additional ₹3-5 crores for cybersecurity over the next 12-24 months. The total R&D and Center of Excellence investment is projected to be ₹12-18 crores. These expenditures are aimed at building new intellectual properties, upskilling employees, and creating world-class capabilities, with an expectation of high returns in subsequent quarters.

The public issue of Dev Accelerator Limited (DevX), valued at ₹143.35 crores, was a key milestone, strengthening DevIT's balance sheet and enabling expansion in managed office spaces. DevX also serves as a significant source of leads and opportunities for DevIT's IT services. Subsidiaries Dhyey and Minddeft contribute approximately ₹25 crores to consolidated revenue, with Dhyey projected to double its revenue in the next couple of years through product development.

Despite global uncertainties, DevIT is experiencing good traction in North America, particularly from SMEs seeking ERP and cybersecurity services. The company plans to utilize funds from preferential warrants to acquire a non-Indian company or establish a physical presence in North America, Europe, or Australia. A specific target of $1-3 million in business is set for a US-based e-governance project in FY26-27, highlighting international growth ambitions.

DevIT has a current order book visibility of ₹130-140 crores for the current financial year. Of this, ₹30-38 crores are expected to continue into FY27. The company anticipates securing new orders worth ₹25-28 crores in the next four months for FY26. Looking ahead, the total order book for FY27, including new inflows, is projected to be ₹38-45 crores, providing a clear revenue pipeline.

Management acknowledged pervasive pricing pressure across all markets, leading to negotiations for extended payment terms. The upcoming labor code introduction will necessitate a review of pricing structures. However, the company noted that most of its contracts include clauses for government regulatory increments, which is expected to help mitigate significant margin pressure from these changes.