Dev Information

Dev Information Technology Limited reported robust financial results for FY25, with revenue reaching ₹1,839 million, marking an 11.38% year-on-year increase. EBITDA surged by 54.91% to ₹237.18 million, improving the margin to 12.9%. Net profit also saw significant growth of 55.98% to ₹147.18 million, with diluted EPS increasing to ₹6.60 from ₹4.18 in FY24. For Q4 FY25, revenue grew 17.77% year-on-year to ₹517.84 million, with EBITDA at ₹29.88 million and net profit at ₹11.35 million.

The company is heavily investing in and focusing on high-growth areas including cybersecurity, AI/BI, and blockchain. In FY25, Dev IT secured approximately ₹20 million in cybersecurity orders and expects to double revenue from this segment in FY26. Similarly, AI and BI segments are projected to double their revenue in the current financial year. Investments are also being made in blockchain solutions through its subsidiary Minddeft, and Microsoft Dynamics solutions via Dhyey, with over 20 solutions already on the Microsoft marketplace.

Dev IT is strategically expanding its international footprint, aiming for overseas markets to contribute 45% to 50% of its total revenue within the next two years. Currently, 90-93% of its overseas revenue originates from North America. The company plans to establish a physical presence in the US by converting Dhyey Consulting's US subsidiary. Concurrently, the domestic market, including both government and private sectors, is expected to grow by 15% to 20% in the current year, driven by increasing digital adoption.

Addressing analyst concerns about a relatively low revenue base, management emphasized a strategy focused on profitability and intellectual property creation rather than just top-line growth. As a pure IT services company, Dev IT aims to select high-value customers in both India and North America and develop solutions that yield better returns. Investments in product building, AI, enterprise solutions, and blockchain are expected to drive increased profitability after a year or so.

Government business constitutes a significant portion of the company's revenue, accounting for 55-57% of the total. While this segment provides a stable revenue base, management noted that margins from government contracts are 'really less' compared to non-government business. The company also experiences higher debtor days, particularly at year-end, as payments from government clients typically take 60-90 days.

The acquisition of Dhyey Consulting was driven by multiple strategic objectives. It aimed to accelerate growth and gain immediate traction in the India and SME markets, integrate Dhyey's co-founders into Dev IT's leadership team, and strengthen the company's Microsoft Enterprise business across India and North America. The acquisition also facilitates leveraging AI within ERP products and enhances the overall value proposition.

The previously announced share split, changing the face value from ₹5 to ₹2, was not completed by March 31, 2025, due to procedural formalities with a mediatory firm. However, management stated that they are finalizing the firm and expect the split announcement to be made very soon, indicating its imminent completion.