Zensar Q2FY18 Concall Summary


Financial Highlights

Zensar Q2FY18 Financial Performance.png
  • The total revenue for the quarter was INR 7,626 million, which reflects a sequential growth of 3.5% in rupee terms.
  • In USD terms, the reported revenue is $118.6 million, reflecting a growth of 3.8% sequentially and 3.1% year-on-year
  • The gross margin, EBITDA and PAT growth was 8.2%, 19.2%,and 33.1% respectively in dollar terms.
  • Digital now accounts for 36.8% of our overall revenue, a growth of 5.3% quarter-on-quarter and 36.3% Y-o-Y.
  • The gross margin for the quarter improved by 120 basis points over the previous quarter despite headwinds on the count of compensation revision, which had an impact of close to 1.5%.
  • The effective tax rate for the quarter is at 25.4% as against 29.4% in the previous quarter.
  • The PAT grew by 33% over the previous quarter.
  • DSO for Q2 was 65 days as against 64 days in Q1.
  • The total outstanding hedges as of 30 September was equivalent to $70 million as against $48 million in the previous quarter.
  • The gain on hedges as of 30 September carried forward in the balance sheet is approximately $38 million
  • There was softness in IM business on account of low revenue in the maintenance and product line of businesses.
  • Overall service revenue declined by 3.6% due to lower product revenue.
  • Zensar had introduced a client partner model for key U.S. accounts, largely to accelerate the process of scaling up these accounts.
  • The overall global projects in the pipeline are at $900-plus million.
  • The revenue of Digital Commerce business grew 3.8% sequentially.
  • Utilization has increased to 85.9% from 83.2% on a sequential basis by rigor on optimization.
  • The company has made the investments in Vinci, Digital Workplace, and ICC.
  • The profitability of MVS business is negative because the company has some restructuring issues.
  • The company have invested a lot of money on first becoming a digital company
  • There was an impact of close to a little less than a $2 million per quarter due to awage hike.
  • The impact on the margin due to the wage hike 1.5% from a quarter-on-quarter perspective
  • The number of marketing staff has been reduced from 143 to 78, almost 45% in last two years.
  • Previously, the company used to run a large inside sales team which they now have completely outsourced.
Zensar Q2FY18 performance other metrics.png

 Tax rate

  • The tax rate of the company is lower because of SEZ profit has increased in this quarter versus the previous quarters.
  • In quarter 1, the tax rate was at 29.4%, this quarter it was at 25.4%.
  • The company believes that for the full year, the tax rate should be between 27.5% to 28%.


  • The company has developed a digital platform called ZenROD, Return on Digital.
  • ZenROD improves the productivity of an enterprise with the help of analytics and alittle bit of artificial intelligence.
  • The company hasalready booked over $1 million of booking from ZenROD platform sales.
  • ZenROD is now available for client deployment. It's a configurable, customizable solution.
  • The company have done over $1 million worth of platform booking on that, roughly about $0.5 million of that already got built

 Foolproof and Keystone

  • The company had initiated introducing the services of Foolproof and Keystone across their client portfolio.
  • There is a positive response from theclient, and they have been very appreciative of anend-to-end suite of services.


  • The company saw good growth across all of their key markets.
  • Africa continued its great performance and grew 8.7% sequentially in constant currency. Europe and U.S. grew 3.3% and 0.5% respect
  • Regarding verticals, financial services, retail, and manufacturing grew sequentially by 5.5%, 5.4%, and 3.4% respectively in constant currency terms
  • Digital Stack business application drove the growth; it grew about 5.2% sequentially
  • Top 5, top 10 and top 20 accounts grew quite well. They grew sequentially by 40 basis point, 60 basis point and 160 basis point.

 Awards and accolades

  • Zensar was mentioned in Gartner's Competitive Landscape partnering for Data Center and Network Maintenance Cost Optimization.
  • Zensar was named as a major contender in Everest Group Workplace Services, Market Trends, and PEAK Matrix Assessment.
  • Zensar was also named in ISG Provider Lens Quadrant Report 2017, ISG Application Development and Maintenance services, as well was included in the new ISG Research Digital Workplace Services Archetype Report.

Recent wins 

  • The company won multiple deals across experience design, Digital Commerce, analytics, automation and digital testing.
  • The company won deals for designing customer experience for one of the leaders in thehealthcare industry in the U.K., a hi-tech company that focused on thecreation of multimedia software product based out of U.S.
  • They have also won multi-year, multi-million-dollar Digital Commerce deal for one of the largest specialty retailers in apparel, a multi-million analytics deal with the global tech major, a robotics process automation deal for a South African financial services group.

 IMS business

  • IM business has been soft, particularly on account of both product sales as well as the MVS, which is a maintenance business.
  • Core IMS business grew by12.8% in constant currency terms sequentially.
  • Vinci is a very critical part of IMS growth strategy


  • There was a decline in ATG which will get more than compensated by anincrease in digital in general and as well as the increase in this ancillary development.
  • The clients who are on e-commerce are moving away from monolithic-like, say, ATG, Hybris.
  • E-commerce clients are building loosely coupled, highly usable kind of applications which can be redeveloped, repositioned in a matter of days, and this the trend in which the industry is moving completely.


Zensar Technologies Q3FY17 Concall Summary

Zensar Technologies Logo
Zensar technologies Q3FY17 financials

Financial Growth

  • Quarter revenue grew by 1.3% from $116 million to $117.5 million.
  • In INR terms quarter-on-quarter revenue grew 2% from Rs.776.7 crores to Rs.792.2 crores.
  • Gross margins grew by 2.3% in US dollar term and 3% in INR term quarter-on-quarter.
  • Our net profit grew by 17.1% in USD and 17.9% in INR again sequentially.
  • Q3 digital revenue accounted for 30% of the total Zensar’s revenue.
  • Core application services business grew at 1.3% sequentially on constant currency basis.
  • Infrastructure management services grew by 3.4% sequentially.
  • The services component growing at 5.3% driven by the vitalized team.

Revenue Growth

  • The company's revenue grew to 1.9%
  • Financial services vertical experienced quite a strong growth of 9.7%
  • Manufacturing vertical grew by 1.4%
  • Retail and consumer services grew by 0.7% sequentially
  • Revenue from US grew by 0.3%
  • Revenue from Europe grew by 30.2%
  • Revenue from Africa grew by 8.1%

Revenue Growth in Constant Currency

Zensar Revenue Q3FY17

New designs overview

  • Large deal from a net new account which is a $3 billion US based clothing and accessory retailer
  • Another large deal for implementation of next generation commerce platform from one of US largest departmental stores
  • Redesign and conversion of mobile gaming platform of South Africa’s largest online gaming company

The Finance flow

  • On the end of this quarter, the company have spent Rs. 29.34 crores
  • On this quarter alone the company spent about Rs. 16.14 crores
  • The company's outstanding debtors is Rs. 593.28 crores or $87.32 million
  • Total cover at the end of December is $44 million
  • The cash on the books is Rs. 539.04 crores or $79.27 million
  • Of which liquid cash is Rs. 338.66 crores or $49.80 million
  • In short term investments at Rs. 200.38 crores which is $29.47 million
Zensar Tec Q3FY17 Revenue & EBITDA in USD

Client Data

  • Revenue from top 5 clients is 37.5%
  • Revenue from top 10 clients is 45.0%
  • Revenue from top 20 clients is 20%
  • A increase was seen in active clients by 215
  • 41 new clients were added in the period
Zensar Tech Q3FY17 Client Data


  • Public shareholding decreased down to 51.4%
  • Promoter shareholding increased up to 48.6%
Zensar Tech Shareholding Q3FY17