Intellect Design Arena

Each CEO is more like a business segment head for IGTB, IGCB, SEEC and IRTM.

One person alone cannot manage all the segments wherein each segment further has multiple product lines. And each business segment is different in the sense that they are different stage of their lifecycle and thus requires different kind of handling, plus the focus geographies for each business segment could also be different. Like for SEEC, US is a focus geography.

1 Like

Is there any document or video that gives some detail about Intellect’s products? I can’t find much detail in the annual report or company website about their products

@saurabhsadhu Please go through this whole thread( where u will find lot of research reports and valuable industry/expert feedback about IDA, it will be like a movie unfolding) along with company investor presentations may be last 16/20 quarters, u will definitely know what they are trying to do.

Also read lasted presentation and Concall Q4FY22, where Arun Jain tried to explain all the pain points/struggles and overcomes.

IDA Picture/movie just started.

4 Likes

@saurabhsadhu You can also check out this highly informative twitter thread by @sahil_vi. There might not be much information about the individual products as such, but the overall business model & thesis have been explained in an intuitive fashion.

3 Likes

IDA has a YouTube channel. many videos on their products are available there. Watch it.

6 Likes

Thanks, @abhicsmnnit. I read the thread, it answered a lot of my questions. But how do you compare Intellect with its peers - Oracle, Temenos, and Finastra? Their products are used by businesses and hence are not as reachable. How do you know they are addressing the right problem in a better way than their peers?

One can check reviews of product and comparison with competition on Gartner Site : https://www.gartner.com/reviews/market/digital-banking-platforms/vendor/intellect-design-arena/reviews?marketSeoName=digital-banking-platforms&vendorSeoName=intellect-design-arena

Not sure, if this will help but my firm uses Intellect’s products (Transaction and Risk Management) and I had a conversation with colleagues and it seems it is a decent product however, they don’t have any experience with any of competitor’s product, so can’t compare.

As far as I understood, each of the dominant players have similar kind of products with continuous work on customizing product as per new requirements. Pricing and Referenciability are the major piece of equation, which is the reason each player is dominant in one or the other segment.

Regarding understanding of Intellect’s Products, Each Segment has it’s own website that you can check. To go deeper into tech stack, you can watch
Tech Day I - Intellect Technology Day 2021 - YouTube
Tech Day II - Intellect Technology Day II - 07th December 2021 - YouTube

8 Likes

Impressive rank positions

14 Likes

New Share:
Mauritius Telecom Partners with Intellect Global Consumer Banking for Digital Transformation and enabling Financial Inclusion
iGCB win in Africa.

AJ
Disclosure: Remain invested.

3 Likes

Insider selling: Mr Jaideep Billa who is President and CEO of Wealth management , Intellect Design Arena is continuously selling.

When the scrip has corrected more than 34% from 52week high, his selling raises concern.

2 Likes

I think this is a non-issue. First, he holds 0.27%. Second, he has disposed off 0.02%, which is 7% of his overall shareholding. People can have needs, career aspirations or what not. Not every ESOP selling needs a merit IMO.

That does include senior folks of various segments within the business. Major thing should be the company CEO, company CFO, any board of directors.

My 2 cents.

15 Likes

Intellect Launches Magic Invoice, the World’s first ‘No Touch’ invoice
processing solution powered by CDR Graph Technology’"

9 Likes

I attended the Investor call today. Arun Jain continued with his storytelling fluency.
New things: The presentation broke out the traction by Geos this time, and the Last 12 months run rates.

Prabal Basu (Advisor to Arun) did a nice Summary of the company focus and plan ahead

  1. IP led company- Monetization of that takes time. Focus on spread right now, margins later.
  2. Calibrated growth, in selected markets, with predictable profitability.
    
  3. Growth is expected to be market leading- ahead of competitors
    
  4. Needs continuous investments - have to come from current cashflows. 
    

Revenues & Margins
1. Revenue traction is good.New products are doing well. Healthy demand continues.
2. Margins are under pressure, EBITDA margin was 21.6% compared to 24.5 a year ago.
3. Margin guidance is now expected to be 20-25 % and not 25-30 % that they had projected earlier.
4. Reinvesting 5 % , instead of raising capital. Margins will be flat. There will be costs on POC, new pursuits etc.
5. Q2 will see salary hikes, plus new headcount. Q3/4 costs should flatten. This should set up for 90 Mn run rate.
6. 100 Mn run rate should be achievable in next few years, ad margins should be 30-35 % at that level.
7. In 2024 margins are expected to go up.

Products & Platforms

  1. Looking at growth coming from Platforms now.GEM Platform- has grown to good size, now the growth will be closer to 40-50 % annually.Exponent Platform- gaining traction
  2. Platform revenues -  B1(Licence - One time ) +B2 (Annual subscription) + B3 (Transaction revenue eg GEM)
    
  3. Licence Linked Revenue: Licence + Platform + AMC 
    
  4. Annual recurring revenue: Platform( B2  + B3)  +AMC
    
  5. R&D Cost - 70 % is expensed, and 30 % is capitalized
    
  6. Competing with Temenos and OFSS on Core banking. And Temenos and Thought Machine.
    

Geos:
1. Curated calibrated growth across geos.
2. North America- 50 % growth expected. Canada is established now across multiple products.US is very small base, mostly iGTB and iSEEC.
3. Europe- Core Banking -Legacy replacement opportunity is big. Germany is main market.
4. Mid East UAE 7 of 9 banks and Saudi 5 Banks are customers already , expand there.
5. Africa- Inbound requests coming in, pull is working due to reputation.
6. Asia- Smaller countries like Vietnam, Malaysia, Indonesia etc well penetrated, now looking to deepen the presence. office in Vietnam.

People: Attrition/Salaries
1. Attrition is now dropping since May.
2. Senior level attrition is managed, no concern there.
3. Add about 800-900 net headcount, similar to last year.
4. Salary increases are mostly in Q1/Q2, but it is a continuous rotation cycle.
5. Salary Hikes are higher than last year.

Investor PPT https://archives.nseindia.com/corporate/INTELLECT_28072022161142_IntimationtoSE_InvestorDeck_Final.pdf

Disc: Invested since a long time and adding on dips

22 Likes

Most people don’t know difference between different IT companies. There is huge difference between Product Company and Project Based IT companies. Both make money but Project companies need to keep winning more and more projects to keep the ball rolling.

While Product companies especially with Sticky Product you need a door to enter then it becomes recurring revenue for almost eternity.

Intellect is product company. Once a Bank chooses their offering, they are locked in as switching cost is huge.

Invested and Still investing.

13 Likes

Hi, can someone please link the earnings call recordings of FY19 & FY20? I am not able to find them on company website or YouTube

Heres the link

No This is Q1Fy23. I need FY19& FY20 calls

Had a chance to see below Gartner Magic Quadrant report where they dropped IDA from coverage.

Intellect Design Arena was dropped because its products did not meet the current inclusion criteria. This can have impact some big deals in 2022 as many are going through Gartner quadrants while making the decisions.

If interested can go through below link on the 2022 coverages:
https://www.gartner.com/doc/reprints?id=1-294PG36U&ct=220214&st=sb

Below is 2020 coverage from Garner:

Hope this helps.

Happy Investing.

Disclosure: I am not having any position in this counter and got interested with SaaS growth(NRR growth)

8 Likes

More specifically ,the reason was …

  • Active Market Presence Criteria: Intellect Design Arena’s Intellect Digital Core didn’t meet the inclusion criteria for the minimum net new production clients going live between 1 January 2019 and 30 December 2020. All criteria applied only to retail core banking installations, evaluated with a tier analysis and excluding simple updates (see the next section for further detail).

So the decision is based on somewhat old data .
Also,the link mentioned that they did not consider islamic banking system projects.IDA has a large number of those as well. So while Gartner has dropped them on a technicality it does not necessarily mean IDA has done badly .
Also IDA has many more products nowadays.

Disc. Invested

6 Likes

Intellect till March 21 was selling mostly iGTB and IDC their Core banking (Core banking ) was still in early stages of its adoption.

If you listen to their latest technology day in December 21 and latest product wins in july 22 they have. Lot of wins on IDC

if there is a later version of this report that will help to track this progress

8 Likes