AGS Transact Technologies Explores New Frontiers with SBI Contract, Open- loop Fuel App Pilot and delivers promising Revenue Analysis in Q3FY24
AGS Transact Technologies Limited, a prominent player in omnichannel payment solutions, has announced some significant developments in the second quarter of fiscal 2024, which demonstrate a clear strategic shift as a result of market dynamics.
Impact of Contract Win with State Bank of India
A contract for the supply, installation and management of more than 2,500 ATMs worth INR 1,100 crores has been signed with the State Bank of India (SBI) by AGS Transact Technologies Limited. This 7-year contract under their payment solution. segment further strengthens its commitment to enhance banking infrastructure in India.
The finance minister has earmarked Rs. 60,000 crores for the Pradhan Mantri Kisan Samman Nidhi Yojana, a move expected to positively impact cash transactions in the country. Major banks are expanding their branches with a focus on Tier-3 and Tier-4 towns. This is indicative of a broader expansion of ATMs and CRMs in the country.
Expansion of Managed Services Portfolio
In keeping with its service excellence promise AGS Transact Technologies managed to bring on board 8,000 ATM/CRMs under their Managed Services fold. This achievement involving such clients as Punjab National Bank and Union Bank of India exhibits how well it is positioned to offer holistic solutions to major financial Institutions.
Another significant milestone is the completionof deployment of 270 dedicated cash vans for UBI and Canara Bank with an order value of around Rs. 250 crores over a 5- year term.
By December 31 2023 AGS Transact Technologies had installed or maintained a network of 78,160 ATMs/CRMs in more than 2,200 Indian cities and towns, thus enhancing growth and accessibility of banking services nationwide.
Innovative Fuel Payment Solution Pilot-testing on Ongo App
AGS Transact Technologies is pilot-testing for its open-loop contactless fuel payment solution on itsOngo app. This initiative, happening at select fuel retail outlets in Mumbai, aims to provide consumers with an enhanced digital experience at fuel outlets.
Ongo app users can pre-set the desired fuel amount for hassle-free refuelling and payment via the Ongo open-loop wallet or virtual prepaid card. Additionally, the Ongo app offers versatility by allowing consumers to make non-fueling purchases at any RuPay acceptance point. Currently, over 580 vehicles have been onboarded in
the pilot phase. This move is expected to strengthen the group’s foothold in the OMC sector. This is also in line with their overall digital business strategy to provide convenience on the go, which entails the issuance of prepaid cards such as NCMCs (National Common
Mobility Card for Bangalore Metro Rail Corporation). So far, approximately 34,700 NCMC cards have been issued..
A Closer Look at the Finances: Revenue Analysis Snapshot
Despite a slight dip in Q3 FY24, total income which was the group’s strategic downsizing of automation businesses leading to reduced costs. Proactive cost optimization and disciplined contract servicing maintained a positive trajectory.
In the quarter under review, AGS Transact Technologies conveyed a revenue from operations totalling Rs 3,737 million, accompanied by an adjusted EBITDA margin of 23.8%. It was further disclosed that in Q2FY24, there was a noteworthy surge in revenue from services, reaching 98%. This increase aligns with the group’s strategic approach of distancing itself from value-dilutive businesses.. Industry Dynamics in the Light of Government Initiatives
After considering the recent budget allocations, AGS Transact Technologies acknowledges the Finance Minister’s commitment to PM-KISAN and the promotion of RuPay debit cards as well as low-value BHIM-UPI transactions. It is expected that these government initiatives will have positive impacts on both cash and digital transactions..
AGS Transact Technologies is exploring the ever-evolving landscape of payment solutions with a focus on prudent business growth. The group’s ability to secure major contracts and introduce innovative solutions, as demonstrated by the Order- win from SBI, and the Ongo app pilot-testing, reflects its drive to advancements in the industry.
(Press Release)
