#PAT #MARGIN

In FY25, PAT margin expanded by ~134 bps YoY to 12.8%. Finance costs contracted as a percentage of revenue. There was an impact of exceptional items in the margins on a YoY basis (recorded during Q2 FY25). Excluding the impact, the same expanded by ~51 bps YoY to 12.6%.

#ROCE

In FY25, ROCE for the company rose to 6.43%, owing to rising profitability. The reduction in ROCE after FY19 is on account of change in the company’s capital structure due to issuance of fresh equity of ₹2,575 cr and funds borrowed in the form of non-convertible debentures of ₹1,500 cr which were used to fund the acquisition of Heinz India Private Ltd.

#ROE

In FY25, ROE for the company increased to 6.29%, owing to rise in net profit. The increase in the net worth post acquisition was on account of capital restructure as the company raised ~₹1,000 cr through QIP (Qualified Institutional Placement) in FY21.

#MANAGEMENT

Tarun Arora is the CEO and the whole-time director of the company, having expertise towards finance, marketing & has worked with various FMCG companies. Dr. Sharvil P Patel, the chairman of the company who is also the managing director of its parent company, Zydus Lifesciences Ltd has an expertise towards chemical & pharmaceutical science. With the softening of raw material prices, they are targeting towards the growth path, providing flexibility for brand investments which would aid volume and sales growth. Growth in e-commerce and modern trade is likely to boost sales. To build its international business, the company entered new markets and enhanced its portfolio with the launch of Nutralite. The company would also be expanding Nutralite to more countries along with developing new products exclusively for international markets. The company is working on distribution expansion in organized channels to drive its market share growth.

#COMPANY #POTENTIAL

• The FMCG sector experienced a strong recovery in 2025 after a challenging post-festive period, marked by inflation and high inventory levels. Retailers, focused on clearing out excess stock, delayed new billings into late 2024. Demand for FMCG products surged in January 2025 and February 2025, driven by an early summer and an increase in demand for premium products. The January-March quarter saw a robust rebound, with ~12% growth. • Inflationary pressures eased significantly during the year, attributable to a sharp correction in food prices, led by a seasonal drop in vegetable prices during the winter months, followed by a continuous drop in pulse prices. • As per MAT March 2025, the overall FMCG market in India (Urban and Rural) grew by 9% in value, 6% in volume and observed a 3% increase in the household penetration, while Zydus Wellness outperformed on all these fronts. This momentum is reflected in the smaller unit packs, indicating increased accessibility in consumption at the grassroot level. quarters. • The overall industry is expected to witness a gradual uptick, driven by expectations of good monsoons, moderation in food inflation and recovery of urban growth. With sustained cost inflation, companies are likely to take price increases in the upcoming • One important factor that would boost the growth of the FMCG sector soon is digitization and increasing use of online platforms. Over the next decade, there will be greater play of mobile analytics, artificial intelligence and cloud technology, which will help the FMCG sector to transform and drive the next phase of growth. • E-commerce segment contributed ~8% during the year and is forecasted to contribute ~11% to the overall FMCG sales by 2030.. Going forward, channel mix will shift dramatically in favour of E-commerce. The growth in the same have aided the sector to drive strong growth in the urban sector. FMCG companies are focusing on digitization for enabling smooth functioning of its supply and distribution channel.

#COMPANY #OUTLOOK

• ZWL intends to grow its revenue, which would be driven by new product developments, easing raw material prices, distribution expansion in India & abroad and via increasing its overall reach (direct and indirect) to 3 million outlets. It is also investing in capability building for the superior back end and customer engagement in the converging online and offline platforms of organized trade. They guided for a double-digit growth in revenue for FY26. • It aims to reach an EBITDA margin level of 17%-18%, driven by improvement in gross margins and operating leverage benefits. • For FY26 and FY27, the company would not be paying any cash tax payouts. • The revenue share from new products is much smaller as they are at an early stage. The company began launching inventory channels across limited geographies and piloted, thereby scaling these products. • Sugar free and Complan constitutes ~85% of the overall international business. Despite the subdued macro-economic conditions in Nigeria, the business demonstrated a positive performance. Middle East business continued its growth trajectory. Their target of achieving a revenue growth of ~8%-10% in their international business in the next 4- 5 years remains intact. Also, it plans to enter newer geographies with relevant offerings. • In Q3 FY25, the company completed its acquisition of Naturell (India) Private Limited, engaged in the business of manufacturing, R&D, marketing and selling of Nutrition bars, cookies, chips and other food products under brands Ritebite Max Protein (Protein fueled healthy snacks) and Ritebite (fiber-enriched snacks). As a result, the financial performance includes ~4-month results of the acquired business during the year. It witnessed over 50% growth, supported by tailwinds and executions. Margins are at a positive low single-digit. • The company is working on distribution expansion in organized channels to drive its market share growth. Its direct reach currently stands at ~6 lakh plus stores and further plans to increase it to ~7 lakh stores in the coming period. The rural distribution CASE STUDY contributes ~50% of the total stores.

Zydus Wellness Limited 400-485
Expected level 600
Support 309

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Aurionpro Solutions Limited Company Details Report

Aurionpro Solutions Limited is a global technology solutions provider offering a comprehensive suite of digital transformation services across banking, payments, transportation, and government sectors. With over two decades of industry expertise, Aurionpro has positioned itself as a trusted partner for enterprises seeking to navigate the complexities of technological innovation. Headquartered in Navi Mumbai, India, the company operates with over 30 offices in more than 30 countries. Their technology solutions have been implemented by over 300 clients worldwide which reinforces their commitment to delivering high-impact, efficient and scalable innovations. The company operates under two key business segments: 1. Banking & Fintech Solutions: Aurionpro offers robust digital banking solutions, payment processing systems, and transaction banking platforms. Their services include retail banking enhancements like self-service kiosks and queue management, as well as wholesale banking solutions such as cash management and Loan management. 2. Technology Innovation & Professional Services: Aurionpro's Technology Innovation Group (TIG) drives digital transformation through creating software and hardware solutions for transit segment and consulting & design for data centers. The company also plays a key role in smart cities and smart mobility where it offers e-governance solutions, intelligent transport systems, and automatic fare collection. As one of the few end-to-end transit solution providers, Aurionpro integrates hardware and software for metro and bus projects with a strong presence in Delhi, Chennai, Kanpur, Haryana in India and California, Mexico and Maldives on a global front.

Leadership & Transformation Under Ashish Rai: Since taking over as Group CEO in Oct 2023, Ashish Rai has played a pivotal role in reshaping Aurionpro’s strategy of driving digital transformation and unlocking new growth avenues. With an extensive background in global financial technology including leadership roles at FIS, Finastra, and Coforge, Rai has leveraged his deep industry expertise to streamline operations, enhance product innovation and expand the company’s global footprint. Under his leadership, Aurionpro has sharpened its focus on high-growth verticals, optimizing cost structures and accelerated revenue expansion. Ashish had joined the board of Aurionpro in FY22 as Vice-Chairman and has played an influential part in the turnaround of the company over the last 3 years. The company has raised capital through preferential share allotments over the last 2 years. The capital raise was done with the intention to acquire companies, capex for new offices and upgradation of facilities and to become a debt-free company. The first round was done at a share price of Rs 440 and the second round was done at a price of Rs 1050, the company raised a total of Rs 6,450 mn (excluding issue expenses).

Aurionpro has spent more than Rs2.5bn over the last 3 years to enhance its existing products and create new ones. The acquisition of Arya.ai has enhanced the company’s capabilities by integrating AI across their existing products. The partnership with Murex has improved post the acquisition of Fenixys and it helps the company co-develop IP’s and increase its presence in Europe and NAM. Its existing products - Icashpro+ and Smartlender continue to witness strong deal wins globally; Rs 1bn+ of deal with SBI in FY24 is a testament to its product offering and will provide a gateway to many more such deal wins across domestic / international banks.

Aurionpro 2.0

Our conviction in Aurionpro stems from various business initiatives undertaken by the new CEO (joined the board in FY22 and promoted to CEO in FY24) towards R&D, developing new IPs, global fintech partnerships, and headcount addition. These initiatives have already started to yield positive results; and along with strategic acquisitions (funded towards capital raise and internal accruals) are all steps in the right direction. Our lateral checks across banking product & services (53% of revenue) & TIG (47%) segment reaffirms our thesis around product acceptance, and the growth opportunity.

Transit & Data centers to drive TIG (Technology Innovation group):

In the transit segment, Aurionpro recently won Delhi Metro and Chennai Metro. This is in addition to its deal-wins globally and demonstrates its strong capabilities as fully integrated player (hardware+ software) for smart gates, kiosks, AFC’s (Automated fare collection) over its peers. On the data center front, it has won a deal from RBI which was for a complex project highlighting its capabilities in consulting, design & implementation. With GOI thrust towards metro connectivity and focus on data centers, we expect these divisions to witness 30%+ CAGR over FY25-27E. On the smart city project, it is working on the Panvel project (Rs2bn), albeit is cautiously optimistic given the nature of business.

Valuations, view & risks

Revenue diversification given presence across multiple tech-segments, huge TAM therein, deal-wins and healthy order book visibility provide greater comfort. 60%+ OCF / EBITDA conversion, superior return ratios, and strong organic growth adds to our conviction. We are factoring in 25.3%/25.6%/29.6% Revenue/EBITDA/PAT CAGR over FY24-FY27E, and value the company at 35x FY27 PE, resulting in a TP of Rs 2,020. Our base case estimates do not factor any acquisitions. Our bear case / bull-case TP is at Rs 1,270 / Rs 2,225. Key risks: Slowdown in BFSI IT spends; delay in metro projects and data centers.

Strong R&D and new product launches a key

Aurionpro has consistently demonstrated its commitment to innovation and technological advancement through robust research and development (R&D) initiatives over the past three years. During this period, the company has invested over Rs 2.5 Bn to enhance its existing product portfolio while simultaneously developing new solutions aimed at addressing emerging market needs. This substantial investment underscores Aurionpro's strategic focus on strengthening its capabilities, improving product functionality, and ensuring its offerings remain competitive in a rapidly evolving technological landscape. Looking ahead, Aurionpro is expected to continue allocating a significant portion of its revenue— approximately 7-8%—toward R&D activities. This sustained investment reflects the company's dedication to fostering innovation and expanding its solution suited to cater to diverse customer requirements. In particular, Aurionpro has recently introduced two new products, Auropay and Aurobees, which were developed over the past two years. Although these products are yet to generate meaningful revenue contributions, their future growth prospects appear promising. With large total addressable markets (TAM) for both solutions, these products are expected to gain traction and start delivering substantial revenue from FY26 onwards. While many of Aurionpro’s competitors are also investing heavily in R&D to enhance their offerings, Aurionpro’s consistent success in securing key deal wins sets it apart. The company's ability to maintain a strong sales pipeline, coupled with a solid order book, further highlights its capacity to translate its R&D investments into real-world business outcomes. These achievements reinforce the notion that Aurionpro’s strategic focus on innovation is yielding tangible results, positioning the company well for sustained growth and continued success in the industry.