💰 Financial Performance

Revenue Growth by Segment

The Banking and Financial Services vertical is the primary driver, contributing 71% of total revenue. Insurance and Healthcare follows at 14%, Government/PSU at 7%, and other sectors at 8%. The company witnessed a 19.5% overall revenue growth in FY25, reaching INR 1,486.9 Cr.

Geographic Revenue Split

EMEA is the largest contributor with 11.0% YoY growth. APAC showed the strongest growth at 58.9% YoY. The USA market grew by 20.3% YoY, while the Indian market grew by 14.1% YoY. Approximately 70% of total revenues originate from international markets.

Profitability Margins

Net Profit Margin (PAT) improved to 21.2% in FY25 from 20.23% in FY24. Return on Equity (ROE) stood at 23.01%, and Return on Capital Employed (ROCE) was 24.47%. Profitability is driven by a shift toward higher-margin mature markets and optimized service delivery through AI.

EBITDA Margin

EBITDA margin was 25.47% in FY25, up from 23.18% in FY24. Absolute EBITDA grew 30.5% YoY to INR 376.21 Cr. This expansion is attributed to higher absorption of fixed costs and increased revenue per customer.

Capital Expenditure

Property, Plant, and Equipment stood at INR 172.16 Cr in FY25, an increase from INR 164.52 Cr in FY24. This expenditure was primarily directed toward purchasing computers for business activities and setting up office premises.

Credit Rating & Borrowing

The company maintains a healthy financial risk profile with an interest coverage ratio of 78.84 times. It has negligible reliance on external debt with an adjusted debt-to-networth ratio of 0.00, indicating it is virtually debt-free.

⚙️ Operational Drivers

Raw Materials

As a software company, Newgen's primary 'raw material' is human capital. Employee costs and rentals constitute a large fixed cost base. Research and Development (R&D) investments represent 9% of revenue, and Sales and Marketing represent 21%.

Import Sources

Not applicable for software products; however, the company has a direct presence in 8 countries for service delivery and talent sourcing.

Key Suppliers

Not applicable for software products. Procurement is focused on technology infrastructure, such as computers and office assets for its 4,600 personnel.

Capacity Expansion

Current capacity is defined by its workforce of approximately 4,600 personnel and its presence in 77 countries. Expansion is focused on increasing the 'New Logo' additions, which reached 62 in FY25.

Raw Material Costs

Employee costs are the most significant operational expense. The company leverages AI to optimize service delivery, which helped mute manpower additions in Q2 FY26 while maintaining growth.

Manufacturing Efficiency

Efficiency is measured by revenue per customer and the transition to annuity-based revenues, which reached INR 833.75 Cr (56% of total revenue) in FY25.

Logistics & Distribution

Distribution is handled through direct and indirect sales channels across 77 countries, focusing on digital delivery of ECM, BPM, and CCM platforms.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

Growth is targeted through the NewgenONE low-code platform, focusing on larger banking customers in mature markets (USA, Europe, Canada, Australia). The strategy involves increasing annuity-based subscription revenue and reinvesting 21% of revenue into aggressive sales and marketing.

Products & Services

Enterprise Content Management (ECM), Business Process Management (BPM), Customer Communications Management (CCM), and the NewgenONE hyper-automation platform.

Brand Portfolio

Newgen, NewgenONE, Number Theory.

New Products/Services

Focus on Generative AI, Machine Learning, and Cloud-based solutions integrated into the NewgenONE platform to enhance workforce productivity and customer journey transformations.

Market Expansion

Targeting mature markets including USA, Europe, Canada, and Australia with specific go-to-market strategies for large-sized banking customers.

Market Share & Ranking

Recognized by Gartner and Forrester; named in Forbes Asia's 'Best Under a Billion' list for the second consecutive time in 2025.

Strategic Alliances

The company utilizes both direct and indirect sales channels and partner networks to grow brand presence in new markets.

🌍 External Factors

Industry Trends

The industry is shifting toward Hyper-automation, Low-code platforms, and Generative AI. Newgen is positioning itself by investing 9% of revenue in R&D to stay ahead of technological obsolescence.

Competitive Landscape

Competes globally in the ECM, BPM, and CCM markets against both domestic and international software product companies.

Competitive Moat

Moat is built on 33 years of domain expertise, 55 patent filings, and high switching costs associated with core banking and insurance process platforms. These are sustainable due to deep vertical integration.

Macro Economic Sensitivity

Sensitive to global economic uncertainties and recessions which could lead to reduced customer spending on software solutions.

Consumer Behavior

Increasing demand for digital-first customer journeys and automated regulatory compliance in the banking and insurance sectors.

Geopolitical Risks

Geopolitical tensions and shifts in global fiscal policies are identified as challenges that could impact international revenue and business continuity.

⚖️ Regulatory & Governance

Industry Regulations

Operations must comply with global data security and quality management standards (ISO), audited by specialized third-party consultants.

Environmental Compliance

Honored with the 'CSR & Sustainability Award 2025' in the Education category; maintains a 'Great Place to Work' certification.

Taxation Policy Impact

The company follows standard corporate tax rates; specific fiscal policy impacts include benefits from export-oriented operations.

Legal Contingencies

The company faces risks related to intellectual property (IP) protection and potential inadvertent infringement of third-party IP, which could lead to litigation. Specific case values are not disclosed in available documents.

⚠️ Risk Analysis

Key Uncertainties

Employee attrition (28% rate) and the ability to attract highly skilled professionals are critical risks. Global economic downturns could impact the 19.5% growth trajectory.

Geographic Concentration Risk

EMEA is the largest contributor, but the company is actively de-risking by expanding in the USA and APAC (which grew 58.9%).

Third Party Dependencies

Dependency on specialized third-party consultants for periodic audits and business-specific compliances.

Technology Obsolescence Risk

Mitigated by continuous R&D (9% of revenue) and a focus on emerging technologies like GenAI and low-code platforms.

Credit & Counterparty Risk

Net DSO stands at 124 days. The company establishes allowances for impairment based on expected credit losses; trade receivables were INR 521 Cr as of Sep 2025.