TANLA - TANLA PLATFORMS LIMITED Share Price

During the Q1 FY26 earnings call held on July 25, 2025, management of Tanla Platforms provided a positive outlook, emphasizing strategic initiatives and robust growth expectations. CEO Uday Kumar Reddy shared insights on their newly announced AI-native platform, which is set to launch with a major Southeast Asian telecommunication provider, aiming to leverage extensive data for new applications in both telecommunications and enterprise sectors. Initial results from this deployment are promising, indicating potential for substantial growth.

The company reported Q1 revenue of Rs.1,041 crores, reflecting a quarter-on-quarter increase of 1.6% and a year-on-year growth of 3.8%. The profit after tax (PAT) for the quarter was Rs.118 crores. Tanla also announced a buyback program worth Rs.175 crores, contributing to a total return of nearly Rs.1,000 crores to shareholders over five years through dividends and buybacks, while maintaining a zero-debt balance sheet.

Management expressed an aspiration for a 20% compound annual growth rate (CAGR) in EBITDA over the next two years, driven by increasing wallet share in the enterprise sector and new strategic deals, including three significant contracts"”two in Mobile-as-a-Platform (MaaP) and the AI-native platform. They expect revenue growth from these initiatives to begin reflecting in results starting Q2 FY26.

Key forward-looking points from management include:

1. Launch of the AI-native platform in partnership with a leading Southeast Asian telco, with a subscription model based on monthly payments per user.

2. Continued expansion into international markets with significant investments planned in Indonesia, aimed at consolidating their presence there.

3. Expectation of revenue growth from the enterprise sector driven by winning new deals and improving EBITDA margins, although challenges in traditional SMS revenue were acknowledged due to competitive pricing pressures.

1. Question: "When will we be able to see ValueFirst numbers reflecting, and is there some delay regarding approvals or regulatory matters?"
   Answer: We have completed the acquisition of ValueFirst India and Singapore, but other global acquisitions are pending RBI approval. We're clarifying all questions they have. While I can't provide a specific date for the approvals, we're hopeful it will happen soon.

2. Question: "What is the visibility on your aspiration for 20% revenue CAGR over the next two years?"
   Answer: Our aspiration is to achieve a 20% EBITDA CAGR, not revenue. The recent new deals and momentum in our enterprise and global business instill confidence in achieving these numbers. However, it's important to note this is an aspiration, not a formal guidance.

3. Question: "Is it fair to say that the entire ILD-led drag is now behind?"
   Answer: Yes, ILD revenue has been consistent and contributes single digits to our revenue. Its impact is minor now, so I don't foresee any major issues arising from it in the near future.

4. Question: "Will the enterprise revenue, excluding OTT, increase?"
   Answer: Excluding OTT could seem unfair as we're pivoting to smart communications. While OTT is significant, SMS volumes are increasing, but competition affects pricing. We aim for better margins as investments in new platforms yield results.

5. Question: "How confident are we of achieving the 20% EBITDA growth?"
   Answer: We are solidly positioned for growth starting Q2. The strategies we've implemented are designed to kick off numbers effectively. I expect to provide clarity on this in our upcoming Q2 call.

6. Question: "How do you consider the buyback structure and its implications regarding tax?"
   Answer: We've opted for a tender route due to regulatory changes. The premium we offered reflects fair value and we've assessed shareholder perspectives. We're happy to clarify this with any concerned individuals to ensure understanding.