Newgen Software Technologies Ltd.
|BSE: 540900||Sector: IT|
|NSE: NEWGEN||ISIN Code: INE619B01017|
|BSE 00:00 | 25 Oct||596.25||
|NSE 00:00 | 25 Oct||596.55||
|Mkt Cap.(Rs cr)||4,173|
|Mkt Cap.(Rs cr)||4172.56|
Newgen Software Technologies Ltd. (NEWGEN) - Chairman Speech
Company chairman speech
The past financial year has been a year of caution introspectiontransformation and hope for all of us. The year was an unprecedented one that providedlong-lasting learnings and taught new ways of existence. During COVID-19 organizationsglobally geared up to adapt to the new normal. Digital workplaces andworking-from-anywhere became a necessity for enterprises across industries which are nowexpediting their digital transformation journeys.
Newgen with its scalable and reliable digital transformationplatforms resilient business model and agile development and implementation approach isideally positioned to enable enterprises and make a positive impact in today'senvironment.
Ensuring Employee Well-Being
Throughout the year ensuring safety and well-being of our employeesand their families has been the topmost priority for us. Newgen is providing all thenecessary assistance and guidance to our employees. Our COVID-19 volunteer teams have doneexemplary work in supporting each and every member of the Newgen family in these toughtimes. I appreciate and salute their spirit. Further we are collaborating with hospitalsand other agencies to quickly vaccinate our employees and their family members acrossmultiple locations.
We continue to have our employees work from the safety of their homes.We are also designing our organisation to become more resilient and agile. We are alsoworking on building an efficient hybrid workplace that will foster increased productivityand yet provide a better work-life balance for the employees. We are transforming ourcomplete work culture to a more result-oriented one and our services and human resourcefunction to become touchless but more responsive to Newgenites needs.
Our major focus has been on ensuring uninterrupted and quality servicesfor our customers and we have a comprehensive and reliable programme in place for this.
It includes synchronized cloud-based continuity strategy product-basedimplementation framework and development of support zones with direct presence in multiplecountries. During the pandemic our cloud-based products ensured uninterrupted servicesfor close to 550 active customers across 72 countries helping them transform many oftheir complex and mission-critical business processes. We not only supported our customersremotely but also developed new solutions to fulfil their fresh and time-sensitiverequirements. We have received encouraging appreciation from our customers for ourcontinued support and engagement.
Demonstrating Steady Performance
We witnessed a resilient performance during the fiscal year 2020-21clocking in revenues of Rs. 673 crores. We continued to witness business momentum withexpanded customer engagements and an addition of 67 new logos under our umbrella. We arehappy to share that the US is now our largest revenue contributor and one of the fastestexpanding markets for us growing at 16% YoY.
During the year the Company has also adopted a strategic approach tocost management and cash flow optimization.
We reported an EBITDA of Rs. 192 crores and a Profit after Tax of Rs.127 crores. We are optimizing our execution capabilities while continuing with long-terminvestments in R&D and sales.
Transition to Subscription Model
Our subscription revenues witnessed a growth of 19% during the year.Our overall annuity revenues remained consistent contributing 57% to the revenues.
We continue on our path to transition from our existing model of newlicense revenues and Annual Technical Services to
subscription-based revenues with most of our new customers. Even forour existing customers wherever possible we are building additional annuity-basedrevenue. This model is expected to start revenue optimisation over the next few years. Webelieve that in time we would be able to transform most of our existing customers intocloud or on-premise subscription model. This conscious shift is expected to enhancevisibility and growth in subsequent years. Many of our new logos are based on cloudsubscriptions and hence their real impact is expected to reflect in the coming years.
Focussing on Innovation and Enhancement of Product Platforms
Continuous improvement is in Newgen's DNA and we constantly keepenhancing our product portfolio. All three of our platforms - ECM BPM and CCM continue tobe frontrunners in their categories and are consistently receiving better recognition fromcustomers leading analysts and most importantly our Global System Integrator (GSI)partners.
Our natively developed product platforms are ideal for digitaltransformation they complement each other for building end-to-end digital solutions forEnterprises. Prominent industry analysts have taken notice of our products andinnovations.
Homogenized Cloud offering of combined solutions andavailability on AWS as well as Azure platform
Built on unified architecture ensuring compatibility andseamless integration
Flexible and Comprehensive Support
We have a strong team of over 470 employees focussed on research andproduct development initiatives. In FY'21 Newgen was granted 3 patents taking the totalnumber to 18 patent grants as of March 312021.
During the year we further enhanced our contextual content servicesplatform for cloud deployment to support remote implementations. We have built new userinterfaces worked on enhanced user experience and added new functionalities to enhanceour low code process automation platform.
Low Code Application Development Platform (LCAP) is a fast growing areain the Industry with majority of enterprises expected to adopt more than one LCAP in thenear future.
We are taking lead in the area especially where LCAP has to be usedfor complex mission-critical processes.
As an organisation we have been following a vertical-based salesapproach using pre-built solution accelerators across our core verticals. Majority of thesales traditionally has been through our direct sales team supported by a large network ofchannel partners. We have more than 15 accelerators in these areas that are mature and arebeing used in many organisations. We continue to enhance our presence in BFSI segmentswith new solution accelerators in Trade Finance
Fund Transfers General Insurance Claims Processing etc.
Over the last five years Newgen has successfully implemented over 500accelerator-based solutions for our large customers. They have found wide acceptanceachieved the desired results for our customers and are working in Mission-Critical mode24*7 at our Clients' organizations.
Strengthening the GSI ecosystem
We are witnessing increased traction in the mature markets of USEurope and APAC as we strengthen our partnerships
with GSIs targeting 'Fortune 2000 enterprises'. Our initiatives in theEnterprise Market are bearing fruits and we have built acceptance from some of the largestGSIs and their large customers. GSIs have implemented their solutions successfully atthese customers' end in record time.
We are supporting them in modernizing solutions and building their IP(using low code application development). We are working extensively with Sales andDelivery leaders and consulting arms of GSI's. Further we are making investments inbuilding partner support ecosystem to provide complete support to GSIs through entiresales implementation and support cycles.
We have developed the internal GSI & Enterprise team and ecosystem.A senior sales leader has been added to orchestrate the Enterprise and GSI sales efforts.We are also adding experienced and relevant sales team in all major geographies.
Our recent successes large deal wins and executions have further builtthe GSIs trust in Newgen.
Building a powerful Newgen Brand and strengthening Sales and Marketing
We are making aggressive investments in enhancing visibility and brandawareness in the International markets through various initiatives including Digitalevents analyst and consultant engagements and enhancing our digital presence and digitaloutreach.
While the short-term economic challenges continue to lengthen the salescycles the enterprises across industries are witnessing an acceleration in their digitaltransformation initiatives.
Newgen has the right combination of technology experience customersuccess industry validation and specialized teams to capitalize on the opportunity. Wehave a resilient business model in place with large recurring business and diversificationacross verticals clients and geographies.
Going forward we will continue to augment our product capabilities andbuild deeper relationships with the GSIs.
We have on-boarded three senior leaders in sales product and humanresources. They bring a wealth of industry experience from many global prestigiousorganizations. Their leadership will infuse new ideas and energy. Furthermore we continueto build local teams across mature markets.
We are carefully monitoring the situation and are working on a hybridmodel to ensure the safety of our employees customers partners and vendors.
In our constant endeavour to help organizations expedite their digitaltransformation efficiently and effectively I would like to thank our teams customersvendors and all the other stakeholders for their continued support. I would also like tothank our existing and new investors for their confidence and faith in Newgen's businessand team. We will keep working towards furthering the best interests of all ourstakeholders.
Together let us create a lasting and positive impact on businessesacross the globe. Wishing health and safety for all.