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Earnings Call Analysis
Q2-2024 Analysis
Tanla Platforms Ltd
The company has lost some opportunities with a customer named Val. However, they are focusing on other business areas as a compensation strategy, with expectations that it won't result in margin pressure going forward.
Their innovative platform has significantly reduced complaints by 90% for major clients like HDFC Bank. Despite initial slow progress due to dependency on various vendors, they managed to finalize an agreement with one of India's largest banks, signaling potential for more closed deals with other enterprises.
The onboarding process for their platforms is nearly complete, which is already contributing to revenue, albeit not at full scale yet. Full ramp-up and its associated revenue impact are expected by the third quarter.
Despite a late start in OTT communication channels due to a competitor's head start, the company is rapidly catching up. With expansions in WhatsApp Business and exclusive partnerships like Truecaller, they're poised to capture a significant portion of the market and see substantial business growth.
The company's presence in 70-80% of banking clients facilitates growth in tandem with the increase in UPI transactions, implying their business grows as the market expands.
There was a slight decrease from 21 to 17 top clients, indicating a modest downsizing in their largest customer base, which may require attention to ensure that it does not signal a longer-term trend.
The reduction in revenue contribution from the top 20 customers is partially attributed to the consolidation effect with ValueFirst and seasonal spends which can fluctuate quarterly. The reassurance here is that no significant customer losses were reported even though some customers reduced their spend from INR 13 crores to INR 12.2 crores over the quarter.
The company is diligently working to integrate their Wisely ATP with mobile operators in Saudi Arabia, although data privacy laws have slowed down progress. Still, the impact on enterprises, especially banks deemed 'astonishing', suggests a substantial market opportunity once the integration issues are resolved.
There has not been a significant increase in international revenue, indicating a steady state in global markets. The company isn't looking to rapidly expand internationally, signifying a strategic focus on deepening existing market presence rather than broadening their global footprint at this time.
A decline in domestic business volume growth by 7% was reported, without specific segmentation or details provided. This suggests that there are challenges in the domestic market that may need strategic focus to reverse this trend.
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Ladies and gentlemen, good day, and welcome to Q2 FY '24 Earnings Conference Call of Tanla Platforms Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Ritu Mehta from Tanla Platforms Limited. Thank you, and over to you.
Good evening, and welcome to Q2 earnings call. Joining us -- joining with us today are Uday Reddy, Founder, Chairman and CEO; Deepak Goyal, Executive Director and Chief Business Officer; and Aravind Viswanathan, CFO. Uday will share his perspective on business entered and strategic progress made. After his opening remarks, we will be happy to engage with participants and address their questions.
Before I hand it over to Uday, let me draw your attention to the fact that today's discussion may future statements that are forward-looking in nature. All statements other than statements of historical fact could be deemed forward-looking in nature. Such statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. A detailed disclosure in this regard is mentioned in the results presentation that is uploaded on our website. Audio recording and the transcript will be available on the website soon. I now hand it over to Uday.
Thank you, Ritu. Good evening, everyone. Thank you for joining the call. I would like to make 4 points before we get into Q&A. The first point is about financial overview. So Q2 has been a milestone year for us with revenue crossing INR 1,000 crores for the first time. We delivered 19% revenue growth and 30% PAT growth and reach INR 131 crores of free cash flow. The second update I would like to give you around value cost. So value cost delivered a very strong performance in Q2 and contributed at an incremental revenue of around INR 100 crores at a consolidated level. So ValueFirst operating was operating at 7% EBITDA before our acquisition.
So ValueFirst operated at -- sorry, -- so before acquisition, ValueFirst operated at 20% EBITDA in the first quarter of consolidation due to improved cost of sourcing and synergy efficiencies. We expect this business to operate at around 16%. We expect to complete the ValueFirst overseas acquisition in Q3, subject to regulatory approvals in local geographies. They would add around INR 60 crores to INR 70 crores on a quarterly basis to our top line. The wholesale business operates at EBITDA profitability of low single digits, and we don't have the same lens of synergies in those geographies, which is with a time to drive higher profitability.
We expected to see the full impact of accusation in Q4 of this financial year. And the third update I will get to give you on organic growth. So we delivered 7% organic growth on revenues Y-over-Y and the flat on a sequential basis. We have tailwind of price increase for 2 months in domestic business, which contributed around INR 35 crores -- INR 33 crores growth sequentially. However, the demand was elastic, and we saw a drop in the volumes of around 7% in domestic business.
So let me give you an update on Wisely ATP, which I think are quite -- we have a lot of enquiries about Wisely ATP ever since we announced results to the market. So Wisely ATP is the biggest innovation of Tanla and Gartner has recently come out with the Magic Quadrant for the CPaaS industry. And so they have recognized Tanla as a visionary in the Quadrant and that is a reflection on our innovation. So when it comes to market, Wisely ATP, we are in the final leg of commercial discussions -- commercial closures with leading banks in India.
So if everything goes right, we should be able to go live during Q3. So as and when we go live, definitely, we'll get to update all of you. So in terms of the Q3 outlook, we expect this Q3 to be a growth quarter. We see -- we clearly see 2 levers. The first is the domestic price increase. enterprises optimized their expense, particularly on the promotional campaigns, which I expect to divest in Q3. We will also get the full quarter benefit of price increase as that was affective only for 2 months in Q2. The second lever is typically Q3 is a strong quarter with a potential [indiscernible] which will drive our business growth. So in terms of the margins, we respond at the current levels.
So with this -- let's get to Q&A, and we will have a very detailed discussion on business and financials.
[Operator Instructions] We have a first question from the line of Amit Chandra from HDFC Securities.
So my first question is on the organic revenue. You mentioned that we had price increase and we have a volume drop off at around 7%. So the volume drop is a function of the price increase and the lower promotional spend? Or is it also a function of the consolidation level happened in the industry where 2 of the larger players like Kaleyra and [ Telefan ] has been acquired. So is the impact of that also because those volumes have moved out?
Yes, -- so Amit, I don't think there is any consolidation effect because those are really not 2 businesses operating in India. What we think is largely it is driven from a price elasticity point of view, right, from a demand standpoint. Of course, there was some IPL-related spend in Q1, which would not have repeated. But clearly, the impact that we saw is that customers did optimize our promotional spend in light of the price increase. So I would say there was more direct correlation between the price increase and volume from than any other.
So Deepak, do you want to add a peak here?
In terms of the price increases, how it has been taken by the enterprises. So like is it just a temporary kind of a phase where they just and -- they're just like realigning to the new pricing structure and the spend, as you said, will come back. So what is the confidence level in terms of you're saying that the promotional spend or the regular spend will come back in terms of volumes. And also if you can -- as you said that the margin impact in this quarter on the organic front was offset by higher margins on the value first. So like -- on the organic front, despite price hike, are we seeing margin compression in the organic side of the business.
So 2 questions, it Yes. So Deepak will address the first question, which is partly in terms of the -- how the customers have reacted to price increase and how sustainable we believe it is -- so Deepak maybe you can start on and I can take this attend.
Yes. So in terms of promotional spend, Amit so see, whenever there's a price increase, obviously, it has not been taken very nicely, right? So the customer takes some time to digest that. And then there are some budgetary approvals also what they need. So that takes time. So it is -- it happens every time. I mean, just nothing new in that. And what we feel is that promotional spend will be -- will be back in the bank in Q3 now the festive season has started and it will be back, right?
It has already started to coming back, as I would say. So yes. So this is what it is.
So -- so Amit, on your second question, right? No, the price increase is not margin dilutive from a percentage standpoint. So there are multiple levers on profitability that we go up and down but price increase, if anything, would be accretive, right, on a steady state to margin percentage. So that's really not how it has played out this time.
And the impact that we'll have, so you mentioned about the loss of contract, the VI, the contract loss that we have. So that impact will mostly come in quarter 3 and quarter 4. So will it because it is impacting the higher margin kind of a business. So can we see at the control level the margins are sustainable at 18%, 19%? Or we can see some kind of margin pressure coming in the coming quarters. And also, if you can comment on the APP, you mentioned that it's like going on and the POCs are still going on. but any status of tie-ups with other telcos because we have ADP tied with 1 telco. So are we targeting other telcos also in Double tire.
So Amit, in terms of question -- your question on the VSB, okay? I think we may not see any impact in Q3. That's what my belief. That's number one. Number 2 is, meanwhile, we are concentrating on other businesses where it is expected to compensate the loss of opportunity with Val. So net-net, we don't see any margin pressure going forward. That's the number one, right? Number two, in terms of wisely ATP, not that PC has been evening. We have completed the PSC for 3 months for the 4 large banks in India. -- they -- the platform has demonstrated a phenomenal results.
It is almost brought down the complaints by 90% including with HDFC and other banks. So -- but as I mentioned earlier, this product needs put up uploads from the various radiators. That's where this is going very, very slow. Now we have clarified also points with various simulators mainly with the [indiscernible] now and our business teams are engaged fully with our fans to close commercials. I allowed to say we kind of closed the commerce with 1 of the largest banks in India, but we're just able to close an agreement. So as and when we close 1 agreement, that agreement, we sit more live and then it becomes easier for us to close with other enterprises.
Okay then, thank you and all the best.
Thank you. We have our next question from the line of Balaji from IIFL.
jCongrats on a strong quarter. So I have 2 questions. So first is, what is the status of the deal that you signed with the largest e-commerce player, which you announced during last quarter's results? Number 2 would be, can you just remind me on how the [indiscernible] SMS pricing tax with respect to other channels, especially after this price increase what the question, please? .
Yes, yes, sure. So Balaji, the customer -- the international customer, which we mentioned last quarter, the onboarding is complete. And we already started seeing some revenues and some traffic going into our platforms, but it is not completely fully ramped up as of now as it takes time. But we feel that in Q3, the ramp-up would be completed and we'll have the full capacity coming on to us for the time we exit Q3. So it has already started. I mean, it's already -- customer is onboarded and the business already started. So in Q3. So that is one. And what was another question?
The other 1 was on the [indiscernible] and NLD price side how does the NLD price tack of with respect to other channels like WhatsApp, or an RCS or even an e-mail for that matter?
See, the NLD price is still cheaper than other channels like RCS and WhatsApp, right? Even after the price increase. But yes, RCS and WhatsApp has their own features own advantages. So if -- so it all depends. Now it is more like providing a complete mix of the channels to the customer and the customer would decide which one to pick up because WhatsApp and RCS and even true color, they provide which media, they provide conversational facilities and long messages. So their customer has a choice to move to those channels as well.
Okay. And just a quick clarification follow-up on the first question on the largest e-commerce player. When you said that the ramp-up would be completed during 3Q, in the last quarter, you had said that your endeavor is to handle about 2/3 of their traffic on your network. So given by the end of 3Q, will we be somewhere close to that?
Yes, absolutely. This is what we are striving for.
All the best.
We have our next question from the line of Deepak Chokhani from Ted Capital.
I just have 1 question others have been answered. Sir, how many new platforms are we currently working on? And will there be any platform which will be commercialized apart from ATP in this fiscal year?
So Deepak, it's a good question. But it's too early to comment. As you know, in fact, we did visit our innovation experience center in Hyderabad. That center is basically established to come out with a lot of new platforms. but definitely informed market hasn't done that [indiscernible] new platform.
We have a next question from the line of Amit Agarwal from Liva Investments.
My question is regarding WhatsApp segment. So we have 15% market share in WhatsApp segment. Any reason that we have such a lower market share in the particular segment. WhatsApp itself is coming out with a lot of business solutions. So do you take it as a competitor or our enabler?
Should I answer this?
Yes, yes.
Okay. So just to -- I mean, I don't know if you missed that, Karix Mobile has been awarded as a growth partner of the year in this year by Meta in the recently held event. There is a very huge Meta event happened in Bombay, and we've been awarded as growth partner of the year. And that is one. Number two, with value cost coming in, our market share, combined market share is much higher now. Number three, we have been growing very, very fast.
The reason why we are -- our market share is lesser, is the reason is that there are historical reasons for that. And wherein there's another competitor of ours who had about a couple of years of head start against us, who are the only exclusive partner for Meta for a couple of years. So obviously, we started late but we are catching up. So we're doing really very well. We have been acquiring a lot of customers. We've been building a lot of use cases. We're building a lot of user journeys. And you would see that -- and our WhatsApp Business is growing very fast. And not only WhatsApp, it's just to tell you, it is not about WhatsApp, it is about overall OTT as a play, right? So WhatsApp is one of the channels in that. So we are doing -- we started doing very well on RCS as well. We already have an exclusive partnership with Truecaller. We are building a lot of use cases there as well. And so if you see we have the largest OTT network today in the country to offer to our customers. And you would see that we would be winning a lot of business on that.
So what is the expectation in 2 to 3 years or what will be our market share in this particular segment?
I mean if you -- I mean we're already starting to gain more and more market share, right? So it's tough to comment. But yes, we would be we would be increasing our share very rapidly.
And my last question is regarding about UPI transactions. So what market share you have in UPI transaction how many UPI transaction will come to us?
See we are present -- as you are aware, right, we are present in a lot of -- I mean a lot of banks, in the BFSI segment. So where this transaction are getting originated, we are present I think about 70% to 80% of those customers, right? So naturally, if the UPI transactions go up, our share also goes up and our business also goes up. So also, this is how it works. So you are aware, right? We are present at about 7 to 8 of the top 10 banks, let's say.
So -- and all these banks are getting UPI transaction as well.
We will take our next question from the line of Mohit Motwani from Nuvama.
Congratulations for a good set of numbers. My first question is with respect to the greater than INR 50 crore client bucket. Previous quarter, we had 19 clients in that bucket, and there were some 2 clients of ValueFirst. Now from total of 21, this has come down to 17. So just wanted to understand, is this -- there's a customer loss or a loss is wallet share? Or is just because of lower spreads by the enterprises that it has moved to other bucket?
Sure, so 1 point there that you should look at, right, when we have given. We also have kind of addressed the top 20 customer movement also in the same way. ValueFirst itself was a large customer of Tanla. So in a way, when you consolidate, it becomes an intercompany transact customers no longer a customer. So that is 1 of the reasons why you see when our top 20 contribution revenues coming down drastically. So that is one.
Two is that this is on a quarterly average basis. And the 1 point which we should notice they had certain amount of most of IPL-related spend, seasonal spend in Q1, right? And I'm confident, therefore, when you again see the seasonal spends come in Q3, you will see this number [indiscernible], right? From there is no customer we have really lost somebody moves from INR 13 crores in a quarter to INR 12.2 crores in a quarter, which is what has happened for a couple of our customers.
That is really what is costing the same because if you look at from a greater than pro customer, right, you've seen a very, very significant movement. If you've seen a INR 10 crores to INR 15 crores, you've seen a significant mover. So nearly we can't look at only 1 bucket but there is no real big loss in terms of customers. Some of them have slipped down from INR 13 crores, INR 10 crores to INR 12 crores , and that's really contributing to this s**t.
Sure, sure. And just 1 clarification. So what was the volume degrowth for the quarter? I mean, there was an ILD price increase, in fact, which came from the last quarter. On a year-on-year basis, there would have been some benefit from ILD price increase plus the NLD increase as well. So what was the total volume degrowth on the quarter, if any?
We were not really calling out volumes across the segment, it makes no sense. What we've said is on a sequential basis, our domestic business volume growth declined by 7% and that's really all we are selling on traffic volume.
We have a next question from the line of Anil Sarin from Centrum Wealth.
Thanks for the opportunity. First of all, I want to congratulate you on coming out with such a detailed presentation and there is a press release, and then there is a letter to shareholders. So what that has done is it has made our job easier, so much of information. I don't think too many other companies provide this. So that's a job well done.
My question is regarding -- during the AGM, you had mentioned, Uday that there is this you are also pursuing ATP opportunity in Saudi Arabia. So if you could provide some update on that, that is one. Second question is, assuming all these things go through, what is the revenue impact? And I'm not asking for a particular revenue, but I just want to reference the TAM, which is given in one of your -- I think it's still in the presentation. So as I look at the TAM numbers, current TAM going forward in the future, et cetera, the security part is pretty slim over there. So is it true that the ATP would not be a substantial contributor to revenue as we go forward? So these are the 2 questions I had.
Yes. Uday here. So when it comes to Saudi, yes, we have been constantly in touch with the mobile carriers out there. In fact, a personal listed with the business team a couple of times to Riyadh. So the problem with both the Saudi and mainly in India right now is -- in both the countries, the data protection bill is approved. The same thing happened in Saudi also. Probably 1 month here at that both the countries approved the data bill at the same time. And that is really pushing -- that is really slowing down of WhatsApp -- sorry, likely deployment. What it means to say is -- so this Wisely ATP has to be integrated tightly with mobile carriers, mobile operators, in the respective geographies.
And then people are thinking from -- people are looking from the lens of data privacy and data security issues side okay? That is really slowing down. Otherwise, the impact that it is delivering to all the enterprise mainly to the banks is astonishing, right? So that's number one. Number two, when it comes to the revenue potential of Wisely ATP, what I would like to make a couple of statements here.
One is it's the more of SaaS products, meaning to say that once we deploy with the telcos and once we start charging into the enterprise side. So we want to charge for per user and per month. So it's more of a SaaS product. It's more a subscription product like okay? So when it comes to TAM, what we mentioned as part of the presentation, one of our presentation is the -- 1 we're talking about is what we want to keep it with us. We don't -- because whenever we receive the money, we have to share with other ecosystem place mainly with mobile carriers and other players like WhatsApp and it could be in Google also. So we are still working on it live.
So what the TAM that we mentioned is what we're going to keep it, potentially keep it with us. So we're not really capturing the total TAM of this product.
Did I answer you question?
That's very useful. One follow-up question is you mentioned that Vodafone impact about that the firewall impact is going to be felt in the fourth quarter. So Meanwhile, the ATP obviously, would be up and running by that time, all going well. As well as the NLD increase and the value first, all of those would be there. So net-net, how much of a setback would be exit of Vodafone, the firewall business have on the fourth quarter numbers.
Anil its difficult to answer, but our intent is to make it on using 0, okay? And we have a lot of levers on our side on a lifted the price increase in India -- domestic price increase in India, that's number one. Number 2 is we are doing a lot of stuff on -- as explained by Deepak, we're doing a lot of solutions on [indiscernible], mainly on the 2, WhatsApp and RCS. So they are on 5. And so we're not too worried about what we lost, but we are worried about how to implement new solutions on the channel that we have.
So very pretty combo about the new channels that we have. In fact, we have ourselves are terminated or agreed not to extend the agreement with VL because it needs to use potential financial commitment. And so as I explained last year, last time, housing [indiscernible] not to offer financial commitment to any operator in any country including India. So as to answer your question, like, we are not too worried about it. Our intent is to make it nearly zero -- this impact.
With your permission, I just had 1 broader question and not to do with quarters, but can I ask now?
Yes, please.
Yes. So Uday, if you go back in your own history, many years ago, you had operations in, I don't know, how many countries, at least 20 countries. So international is nothing new for Tanla. Why is it that you are still confined to India when you have a history of operating in multiple countries in the past.
See good question, Anil. We did operate when we are very small, and we are very young in most of the markets, absolutely. I completely agree to agree with you. But we have slightly changed our strategy. One is we see India's biggest opportunity for all of us, mainly for Tanla because we understand the local markets very well. We try to understand the local tariff really well. And also, the way we would like to see ourselves is wherever we operate, we would like to be the market leader.
We don't want to spread into 20, 30 countries. -- and today we would like to generate around INR 50 crores to INR 100 crores in each geography, which will not put at it. So whenever we enter, we would like to make ourselves as the market leader in that geography because we move to our other geographies. So we're not in great hurry to move to 20 countries and impress the market. We are not a more.
All right. Okay. I wish you all the best for the coming quarters and years.
We have a next question from the line of Tejas Shah from Laser Securities.
I heard part of the wide discussion. Why do we lose that customer. Other thing is we are losing -- are we losing a lot of customers who use mobile for any pricing pressure on any services issue.
Can you repeat your question again? It was not clear.
I have a clarification on why [indiscernible] basically, why did we lose that customer -- and why are we losing more customers to route to mobile? Is it only purely on the pricing power? Or are we losing something on the features?
So -- you asked a specific question. So a specific answer, no, we have not lost any customer to the said company. And as far as our technical capabilities and our features are concerned, we are far superior.
Let me also add just for page let me add 1 more important point here, in addition to what Deepak has mentioned it, I encourage you to read the customers quarter report which was released a month ago. In fact, we have planned to tend to all our shareholders from next few starters. look at where we are in relation to our competitors globally, okay? We have recognized -- they have recognized our partner has recognized Tanla as one of the most innovative partners globally, right? So that speaks volumes about our innovation. That speaks volumes about our platform's capabilities, right? So I hope I answered your question, Tej.
Yes. But then how quicker will we be able to grow our EBITDA or margins because our products are superior, services are superior but there aren't facing any pricing pressure from anywhere?
Pricing pressures are there okay? And I would say India is such a market that where customers are very, very sensitive about pricing, okay? They want the best of the lot, they want best of solutions. At the same time, they would still look around and ask for who can give us the best price, right? So this is what it is. But if you really ask me, we have been innovating. not just in terms of platforms, we are innovating in terms of our solutions. We are innovating in terms of overall offerings. So what we are doing right now is we are going to the customer.
We are saying, hey, how we can bring your overall spend down and how we can give you better ROI, how we can give you -- how we can add value to your business, provided, if today, my share is 50% or maybe 45%, would you give me your 80%, 90% share, if I bring your overall cost down, right? And so this is what our -- pitches. And that is helping with, as I mentioned, with our overall offerings. We have our largest OTT network today. which helps. Now we can differentiate, let's say, it's not necessary that for every transact or for every communication you have to send an SMS You can send an SMS, maybe you can send RCS or a Truecaller or WhatsApp, where you see a better engagement, where do you see better ROI, okay? So we can provide -- we are providing that kind of platform today to our customers. and we are seeing good penetration on that and good acceptance on that.
So this is how we are changing the game here.
We have a next question from the line of Amit Mishra, an individual investor.
Yes. I have 2 questions. So first one is -- what's the progress on core partnership? Did we sign up the first client? And if not, what's the time line?
So Amit, we have a partnership with Core the last -- a little more than 1 year. But what we released this Core, the platform is mainly meant to large and mainly meant for European and American customers rather than Asian customers. because approach are different, the regulations are different, complaints are different. So that's what we noted after working closely with large banks in India.
So what we decided to do is not to work with only Core, we decided to work with even other similar platforms. So the Board and the senior management have taken that consideration last month. to -- not necessarily to work with only Core, but also to work with other similar platforms where they can help us win more business in India. So -- so we don't really worry about our Core on the churn.
So as a follow-up, so is it like Shell for now and you will see when the better opportunities arises like this, like in countries like Indonesia or elsewhere.
Yes. still as and when we see synergies where we think we can take a core to a large deal polling open, we are open -- but meanwhile, we would like to work with even other pricing platforms because we don't want to lose the business.
And the second question is related to the Vodafone contract, which we lost on platform business side. And I understand, yes, that it was due to complete in November. They've probably got a better deal as well like cheaper price. But what are we doing to protect our platform side of business? Because Wisely the product for Tanla, we should be better -- like in protecting our business or clients because Wisely provides xyz.
Amit, -- as I mentioned, India, like no. So the -- we have decided not to extend the agreement with [ VL ] that's number one. Number two, what you need to understand this impact once we deploy the platform with any enterprise mainly with the telcos, our areas is service providers. We -- this is the first time that we launch. I mean we kind of decided not to extend our agreement these are reasons best known to all of us. The situation that we are right now in. So we don't want to take any financial risks. That's how we have decided to not to extend with many [indiscernible]. -- with the [indiscernible] telco, right?
So we have not pulled out this because the product is not functioning. In fact, product is performing so well, but they need some financial commitment, situation that they are in right now. but we have decided to not do that relationship anymore.
So as a follow-up, this -- is this because Vodafone finances are not in good shape and they are probably negotiating on all of their deals. All the -- we didn't decide proceed because...
Yes. Amit, sorry, it is not fair on our part to behalf of -- to comment on behalf of our partners. We have a very, very strong relationship with Vodafone for the last probably decade. We're still the largest partner for -- so I don't want to really discuss certain things, which I'm not authorized to discuss. So I would like to leave it there.
Fair enough. Just one last question, if I can squeeze in, please. So we had this co-sell arrangement for Wisely with Microsoft. Is there any progress on that? Or are we utilizing or having some traction there? That partnership seems to be -- we haven't received any update.
Yes. I agree with you, Amit. Yes, of course, that's a long-term agreement with Microsoft. But the technology has moved on in the last -- at least mainly in the last 1.5 years, a lot of technology changes in the cloud space and the major stack and the AML. So we are closely watching this area -- and because it has -- because of the [ PTP ] was stable and approved in the parliament a couple of months ago. So now the regulations have changed, the technology has moved on the enterprise, that demand is gone to the next level. So we are closely looking at the situation live. So that's the reason we were not able to give an update.
Thank you and congrats on the good set of numbers. Hopefully, you'll get more growth in Q3.
We have a next question from the line of Swapnil Potdukhe from JM Financial.
So just I wanted to check with you on the Vodafone India deal. And from what I understand, the impact will be on the international traffic that we have mentioned in our press release as well. Now could you help us understand, does that mean that any traffic -- ILD traffic that flows through Vodafone that will no longer flow through Tanla henceforth or is it something else? Basically, I'm just trying to understand the impact on a -- from a layman's perspective, what were we getting earlier and what we will not be getting henceforth?
Swapnil, It's a good question. A is it does not have any impact on our ILD business, 0 impact on our ILD business side. Suppose that the Deepak and the business development team is really the impacts and -- so they don't really care whether our platforms enterprises any quarter telco or not, okay? There continues to win the deals with the large [indiscernible] totally. -- and does not have any impact on [indiscernible]. That's number one, right?
Number two, is, yes, the minute we pulled out our platform. it doesn't be there [indiscernible] I can submit to the new platform or I can submit that same traffic to other telcos who will bring to the [ VL ] through interconnects. So nobody has any control on any traffic. So it has got a 0 impact.
Swapnil does that answer your question?
Yes. I mean, it could -- I mean, if you could just go a little bit more simpler because see, the issue over here is like -- obviously, we don't understand the technicality so well in terms of how the deal was?
Yes. So Swapnil, currently, we are managing their firewall, okay? So once our deployment is over, we will not be managing that firewall. What does it mean is the firewall -- what the firewall does is it detects which are our international messages which are domestic messages. And it blocks the domestic messages, and it allows only international messages to pass through -- so that's -- there are no revenue leakage for the telecom operator, right? So this is what our firewall is doing currently. And for that, we have a revenue share arrangement with our telecom operator and which we already stated that what would be the financial impact once the deal is over. But as far as our ILD business is concerned, let's say, IT business here is done by Karix Mobile or now even ValueFirst and similarly, a lot of other companies.
So we are unaffected by that. okay? So we would still continue to connect with all the operators and continue to enjoy the similar pricing. And so there will be no impact either on pricing or on our services.
Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Ritu Mehta for closing comments. Over to you.
That was the last question for today. In case we did not answer your questions, you could reach out to us at investorhelp@tanla.com. Thank you very much.
Thank you, members of management. On behalf of Tanla Platforms Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.