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Newgen Software Technologies Ltd.

BSE: 540900 Sector: IT
NSE: NEWGEN ISIN Code: INE619B01017
BSE 00:00 | 20 Apr 320.00 0.95
(0.30%)
OPEN

331.00

HIGH

340.95

LOW

316.45

NSE 00:00 | 20 Apr 319.70 0.45
(0.14%)
OPEN

330.00

HIGH

342.00

LOW

315.40

OPEN 331.00
PREVIOUS CLOSE 319.05
VOLUME 22472
52-Week high 340.95
52-Week low 114.20
P/E 21.36
Mkt Cap.(Rs cr) 2,239
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 331.00
CLOSE 319.05
VOLUME 22472
52-Week high 340.95
52-Week low 114.20
P/E 21.36
Mkt Cap.(Rs cr) 2,239
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Newgen Software Technologies Ltd. (NEWGEN) - Chairman Speech

Company chairman speech

Newgen's digital automation platform has supported business applications necessary toachieve organisational excellence efficiency flexibility and business continuity.Today in all our five core verticals we are helping our clients many of whom are in the'essential services' category to continue uninterrupted functioning while servicing theircustomers with speed and security.

Internally too we took control of the situation with our foresight quickdecision-making business continuity processes and robust IT infrastructure and equippedour global employees for the digitalised work-from- home (WFH) regime. Our cloud-basedsolutions made project development and delivery seamless despite our team workingremotely.

A time of transformation

Keeping in mind our core value of 'Newgen as a family' we have prioritised thewell-being of our employees and their families while ensuring zero lag in customeroperations. Our COVID-19 action team has been constantly assessing the situation andresponding promptly ensuring seamless transition to remote working and giving our WFHworkforce everything they need to maintain the highest levels of performance and also tokeep their faith in the Company's support. Today our entire workforce is enabled to workremotely and is fully functional. In these difficult times we have seen extraordinarydedication in our employees who have always had the attitude of customer first.

Our well-defined business continuity plan states different types of potentialdisruptions and outlines the respective response mechanisms. We have enabled businesscontinuity for our customers through past health crises including the Ebola outbreak of2014-2016 in West Africa and our ability to address critical situations at the first signof trouble has only become stronger with time.

We are developing products and solutions that are low-code flexible and cloud-readythus enabling our client organisations to resolve complex business problems andempowering them to reinvent their workplaces. Our aim is to always be more effectivedelivering greater results with fewer resources and in shorter time. Alongside helping ourclients achieve digital transformation we are transforming ourselves too. We havecrafted our strategic approach to drive agility efficiency responsiveness and customer-centricity in organisations by integrating the various facets of an enterprise - peopleprocesses systems and things.

There are many things to be learnt from this crisis; we are delving into thoselearnings in order to increase resilience for ourselves and our clients.

Business performance

For FY 2019-20 we closed the year with revenues of Rs 661 crores up 6.5% compared tothe previous year. Newgen business witnessed growth across most geographies — theEMEA region (Europe the Middle East and Africa) grew at 17%; APAC (Asia- Pacific) at10%; and Americas region at 5%. India however experienced slow growth because of thecrisis involving NBFCs consolidation of banks and a liquidity crunch. The last quarterof the financial year was further impacted by new business deferments due to the movementrestrictions imposed globally on account of the pandemic.

Overall we did 71 new logo acquisitions during the year bringing our numbers to about560 active customers across 69 countries. Our digital solutions are of mission-criticalnature for our longterm customers serving as the backbone of their operations. Newgen'spolicy of doing business on the basis of trust and collaboration with clients has earnedus great goodwill during the coronavirus outbreak. We have been receiving appreciationfrom customers across the board for our support to them during this testing and demandingphase.

Our annuity revenues continued to remain strong — they constituted 56% of therevenues and witnessed a growth of 22% YoY Of the annuity revenues SaaS (software as aservice) revenues grew rapidly at 60% YoY Most geographies are increasingly showingacceptance of SaaS solutions which are easy to deploy remotely and should become a keyelement for us in the 'new normal'.

Profits and margins were impacted during the year on account of slower growth in thetop-line and continued investments in research & development and sales & marketingefforts. The Company reported an EBITDA of Rs 105 crores and Profit after Tax of Rs 73crores.

Strength in innovation

During the year Newgen's solutions have received various analyst recognitions fromleading research firms.

We have a strong team of 400+ employees focussed on research and product developmentinitiatives. During the year Newgen was granted 4 patents taking the total to 15 patentgrants as of March 2020. The endeavour is to work on enhancing our product portfolio tomeet the evolving industry needs changes in customer requirements and competitiveproducts and features thereby meeting customers' expectations while reducing their totalcost of ownership.

Our reach is being further expanded globally through our direct and indirect salesnetworks. Newgen is focussing on strengthening its System Integrator ecosystem. SaaS salesthrough System Integrators in Fortune 2000 customers in the US is thriving and we areseeing good traction in this.

We have recently received approval for setting up a unit in the IT/ITES SEZ in NoidaUttar Pradesh from the Development Commissioner of Noida Special Economic Zone.

Outlook

While in the short term the macro-economic and public health challenges are expectedto delay new deal signings and lengthen the sales cycles we believe that today therelevance and requirement of our digital transformation solutions for enterprises is morethan ever. These solutions are a natural fit for our strategy of remote implementation.

We are thus reinventing our ways of working and restructuring our teams. A combinationof digital connectivity and data security helps us to successfully execute and expediteproject deployments and sales discussions. We are building local teams across maturemarkets and are focussing on strengthening our worldwide network of global SystemIntegrator partners. Going forward we are prioritising SaaS- based delivery models.

We are looking at increasing operational efficiency and optimising costs for cashpreservation and maintaining healthy liquidity during this phase.

I strongly believe that Newgen has a resilient business model with large recurringbusiness from existing customers; and diversification across verticals clients andgeographies. We are carefully monitoring the situation and taking all necessaryprecautions for employees customers partners and vendors. The Company would beimplementing a phased and safe return-to-work plan. Taking resolute steps we are adaptingto the changing dynamics.

In conclusion allow me to thank our team our customers and all stakeholders. Theirsupport gives us strength in our journey. With the stakeholders keeping their faith inNewgen we shall continue to write newer chapters of success.

With Best Regards

Diwakar Nigam

.