R K Swamy IPO

The company has close to 5 decades of experience as an integrated marketing services provider.

The company initiated a standalone customer data analytics business in 2008 through its subsidiary, Hansa Customer Equity. Since then, the company has catered to over 200 clients in this field.

The company has catered to over 4,000 client organizations since its inception. It served over 380 clients in the six months ending September 30, 2023. It has a diverse client base across various industry verticals.

The company’s marketing and client services network covers 12 Indian cities, with 12 offices and 12 field locations. Recently, the company established foreign subsidiaries in Dubai and Bangladesh. This is mainly to extend services to clients in the Middle East, North Africa, and South Asia, including Full-Service Market Research offerings.

In India, the company has a 'national data-collection field infrastructure' present in 17 cities. As of September 30, 2023, this network consists of 1,350 individuals, including 47 field executives, 1 third-party payroll employee, and 1,302 freelancers.

The company’s revenue from operations was Rs. 173.55 cr, Rs. 234.41 cr, and Rs. 292.61 cr in FY 2021, 2022 and 2023 respectively. In the same periods, the company’s Profit after tax was Rs. 3.08 cr, Rs. 19.26 cr and Rs. 31.26 cr.

The company relies significantly on its key clients, with 93.72% (Rs. 132.2 cr) of revenue for the six months ending September 30, 2023, and 83.73% (Rs. 245.0 cr) for Fiscal 2023 coming from 267 and 301 repeat clients, respectively. Dependency on these clients poses a potential risk to business, financial results, and overall stability.

The company's revenue is heavily reliant on specific key industries, and a decline in demand for marketing services within these sectors may lead to a reduction in revenues, potentially impacting its business, financial condition, and operational results. A significant concentration of clients is observed in the Banking, Financial Services, and Insurance (BFSI), Automotive, and Fast-moving consumer goods/consumer durables/retail/e-commerce industries.

Digital marketing and Integrated Marketing Communications are significant components of the company's offerings, constituting the primary source of income. For the six months ending September 30, 2023, and the financial years ending March 31, 2023, March 31, 2022, and March 31, 2021, revenue from digital operations contributed 80.22%, 78.13%, 75.30%, and 69.81%, respectively, to the total revenue. Similarly, revenue from Integrated Marketing Communications contributed 44.00%, 49.23%, 46.60%, and 40.76%, respectively, to the total revenue from operations during the same periods. Consequently, any decrease in outlay by clients, the loss of clients seeking these services, or the inability to attract new clients in these business areas could have a material adverse effect on the business, revenue growth, financial condition, and results of operations.

The company's operations are dependent on the availability and cost of advertising space, media purchases, and production sites. Any limitations or substantial price hikes in these areas may have adverse effects on its business, financial results, and overall financial condition.

The company, along with its directors, promoters, and subsidiaries, is currently or potentially entangled in legal and regulatory proceedings. Adverse outcomes in these proceedings could significantly impact the business, financial condition, cash flows, and operational results of the company.

The company has certain contingent liabilities and their realization could have a potential negative impact on its financial condition.