Hinduja Global Solutions (HGS), a prominent player in the business process management (BPM) and digital media industries, has announced its unaudited financial results for the first quarter of the fiscal year 2024. Listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), HGS has shown commendable growth and adaptability in the face of a rapidly evolving macro-business environment.
Partha DeSarkar, the Executive Director and Group CEO of HGS, expressed his satisfaction with the results, stating that the first quarter’s performance underscores the company’s ability to transform and thrive in a dynamic landscape. The BPM business achieved an impressive operating revenue growth of 7.0% over the previous quarter (Q4 FY2023), accompanied by notable margin improvements. The Canadian and UK sectors of the business demonstrated robust performance during Q1 FY2024, particularly in terms of strong demand in Canada and offshore/nearshore operations.
A noteworthy development in July 2023 was the formal launch of HGS’s Customer Experience (CX) hub in Barranquilla, Colombia. The company plans to double its delivery capacity at this hub soon, which aligns with its expanding operational performance. However, the Profit After Tax (PAT) for Q1 FY2024 was lower than the same period in the previous fiscal year due primarily to a reduction in other income.
HGS acquired Teklink, a data and analytics business, in Q4 FY2023. Teklink’s performance in the first quarter of FY2024 was impressive, generating revenues of approximately US$ 8.8 million with an EBITDA margin of around 22.2%. HGS’s strategic cross-selling efforts have led to a robust pipeline, featuring several wins. Additionally, the technology solutions arm of the company recorded revenues of US$ 24.3 million in Q1 FY2024, with a target of reaching an annual revenue run-rate of US$ 100 million.
The company completed a significant buyback offer in June 2023, repurchasing 60 lakh equity shares at a price of Rs. 1,700 per share, aggregating to Rs. 1,020 crore. This initiative was part of HGS’s commitment to share the value generated from the sale of its former healthcare business with shareholders.
Despite prevailing global economic uncertainties, HGS remains cautiously optimistic about the year ahead. The company is confident in its ability to navigate challenges and capitalize on opportunities through its technology-driven and people-centric approach. Cost optimization measures, including real estate rationalization, will also remain a focus.
Vynsley Fernandes, Whole-time Director at HGS and Head of the Digital Media Business, highlighted the company’s ongoing commitment to innovation. The launch of the unique OTT aggregator app “NXTPLAY” has been well-received, offering access to over 300,000 hours of content from more than 25 OTT platforms through strategic partnerships. Simultaneously, HGS has accelerated the expansion of its digital infrastructure across India, including the rollout of its 114th NXTHUB and investment in a National Long Distance Fibre Network in key states.
In terms of financial performance for Q1 FY2024, HGS’s consolidated total income reached Rs. 1,247.6 crore. The company reported an EBITDA (including Other Income) of Rs. 191.0 crore, with EBITDA margins for the quarter standing at 15.3%. The Profit After Tax (PAT) amounted to Rs. 16.6 crore. HGS demonstrated a robust financial position with a Net Cash and Treasury Surplus of Rs. 4,962.0 crore as of June 30, 2023.
HGS’s strategic focus on its retained business, comprising digital-enabled customer experience solutions, human resources outsourcing/payroll processing, and digital media, has yielded remarkable business highlights. In Q1 FY2024, the company secured eight new logos for digital-enabled CX solutions and ten for HRO/Payroll Processing. It also signed 24 opportunities with new and existing clients for core CX and digital solutions. Teklink, one of HGS’s acquisitions, entered into multiple projects across 24 existing clients.
As of June 30, 2023, HGS boasted an active clientele of 299 CX/BPM clients and 772 HRO/Payroll processing clients. Additionally, the Digital Media business (NXTDIGITAL) boasted a customer base of more than 5 million. The company’s employee headcount stood at 19,947 as of the same date.
HGS’s extensive global presence included 35 delivery centers across nine countries as of June 30, 2023. In the Digital Media segment, the company covered 4,655 pin codes in India and serviced 351 cities with wired broadband. With 114 owned-and-operated NXTHUBs across India, HGS is making strides in expanding digital inclusion in semi-rural and rural markets.
The company’s achievements were recognized through several awards and accolades in Q1 FY2024, further underscoring its industry leadership. Notable awards included recognition from HFS, Quadrant Knowledge Solutions, Everest Group, and the Asia Pacific Stevie Awards.
HGS’s Digital Media business showcased key highlights in the form of its NXTPLAY app, designed to aggregate content from over 25 OTT platforms, and the expansion of its NXTHUB network. The commissioning of a National Long Distance Fibre Network in strategic states aligns with the company’s commitment to broadband and digital television push in those regions.