Sagility India LtdConcall Notes - Feb 2025 Financial Performance: Q3 FY '25 revenue at $172 million (₹14,531 million), reflecting a year-on-year growth of 15.3% in INR and 14% in constant currency. Q-on-Q growth of 9.7% in INR and approximately 9% in constant currency. YTD revenue growth for FY '25 compared to FY '24 at 15.3% in INR terms and 13.9% in constant currency, totaling $476.5 million (₹40,014 million). Adjusted EBITDA for Q3 FY '25 at $54.1 million (₹4,567 million), representing a year-on-year growth of 67.3% and an adjusted EBITDA margin of 31.4%. Adjusted profit after tax (PAT) for the quarter at ₹2,626 million, a year-on-year increase of 67.6%. YTD adjusted EBITDA of ₹11,104 million grew 30.2% year-on-year, with adjusted PAT of ₹5,709 million growing 34.5% year-on-year. Operational Metrics: Total headcount at the end of Q3 FY '25 stood at 39,595, with an addition of 1,215 employees during the quarter. Attrition rate at 21.8%, significantly lower compared to the previous year. Operational cash flow generated close to ₹9,132 million in the first nine months, representing 94% of reported EBITDA. Acquisition: Acquired BroadPath Healthcare Solutions, which is expected to be accretive to earnings, with a revenue contribution of approximately $70 million. BroadPath enhances Sagility's capabilities in member acquisition, particularly in Medicare and Medicaid segments. Acquisition aims to diversify the client base, adding over 30 mid-market clients and increasing presence among top 10 payers. Integration of BroadPath's proprietary platform, Bhive, expected to enhance operational efficiencies and employee engagement. Market Dynamics: Open enrollment period significantly boosts business volumes, with planned additions from clients contributing to revenue growth. Payer vertical grew 13.1% year-on-year, contributing 89.3% of total revenue, while Provider business grew 38%, contributing 10.7% to total revenues. Management emphasizes the importance of year-on-year comparisons due to seasonality in business. Margin Guidance: Management anticipates maintaining EBITDA margins in the 24%-25% range on an annualized basis, despite Q3 showing a higher margin due to seasonality and operational efficiencies. Increased operational efficiencies and favorable foreign exchange movements contributed to margin expansion. Strategic Focus: Continued focus on expanding both Payer and Provider segments, with a strategy to grow in the mid-market client base. Management remains optimistic about growth prospects, expecting to continue growing in the low-to-mid-teens percentage range. Challenges and Risks: The management acknowledges seasonality in business, advising stakeholders to focus on year-on-year performance rather than quarter-on-quarter comparisons. Potential headwinds from regulatory changes in the U.S. healthcare landscape are being monitored, but currently, no direct impacts are anticipated. Overall Outlook: Management expresses confidence in the company's operational excellence and investments in automation, analytics, and GenAI to drive future growth.