Pelatro Limited Q3 FY26 Earnings Call Summary

Summary

Pelatro Limited - Q3 FY 2026 Earnings Call Summary Thursday, February 05, 2026 5:00 PM

Event Participants

Executives 2 Sharat Hegde (CFO), Subash Menon (Chairman and Managing Director)

Analysts 3 Janhavi Patil (Orim Connect/IR), Nishita (Sapphire Capital), Prasenjit Paul (Paul Asset), Yash Minaria (Manarin Investments)

Financials & KPIs

Geographic & Segment Commentary

• CVM Division: Focuses on the mViva customer engagement platform across 46 telecom networks; this segment is entirely organic and achieved significant growth through deep domain expertise in subscriber data.
• Estel Division: Acquired ~7 months prior, this segment handles eTopUp, sales and distribution management, and mobile money; it provides a foothold in the Fintech/Mobile Money space for telcos.
• Geography: Maintaining a dominant presence across 35 countries with primary concentration in Asia, the Middle East, and Africa; the platform scales to handle networks with up to 500 million subscribers.

Company-Specific & Strategic Commentary

• AI/ML Integration: Management is launching a branded AI platform/module in March 2026 at the Mobile World Congress (Barcelona) to consolidate existing AI capabilities for revenue growth and churn reduction.
• Service Penetration: Approximately 67% (31 out of 46) of customers now utilize Pelatro’s managed services, up from only 1 out of 13 in 2019, significantly increasing the revenue per customer.
• Intellectual Property: The company currently holds 11 patents and focuses on in-house R&D (expensed, not capitalized) to maintain a technical moat against much larger competitors.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Margin Sustainability

• Question: How can Pelatro sustain >25% margins when larger competitors like Tech Mahindra subsidiaries operate below 20%? (Prasenjit Paul)
• Answer: Pelatro benefits from business non-linearity where costs do not increase in tandem with contract size; R&D is already expensed, and current EBITDA growth of 119% versus revenue growth of 69% validates this trajectory (Subash Menon).

Acquisition Strategy & History

• Question: Given the promoter’s history with Subex, how will Pelatro avoid similar pitfalls in acquisitions? (Prasenjit Paul)
• Answer: The failure at Subex was due to a single, expensive, debt-funded acquisition (FCCBs); Pelatro is strictly focused on ROCE and will only acquire based on product/customer synergy at the right valuation (Subash Menon).

AI Impact

• Question: Is AI a threat to SaaS pricing and margins? (Prasenjit Paul)
• Answer: For cost-reduction plays, AI is a threat; however, Pelatro is a “revenue growth” play for telcos. Management views AI as an enabler to increase the value of actionable intelligence provided to customers (Subash Menon).

Revenue Growth Mix

• Question: What portion of growth is organic versus acquisition-led? (Yash Minaria)
• Answer: The CVM division growth is entirely organic, while the Estel division represents the acquired growth; within organic growth, ~60% is driven by existing customers (Subash Menon).

Key Takeaway

Pelatro Limited delivered a robust Q3 FY 2026, characterized by a 69% YoY revenue jump to ₹38.38 crores and a 119% surge in EBITDA, highlighting strong operational leverage. The company successfully manages 1.5 billion subscribers across 46 telecom networks, with a growing shift toward managed services which now capture 67% of its client base. Strategically, the firm is pivoting toward a branded AI platform to be launched in March 2026, aiming to move from current 22% EBITDA margins to a 26-30% range over the next two years. Despite historical concerns regarding the promoter’s previous ventures, management emphasized a conservative, ROCE-led approach to future M&A. With 9M FY 2026 performance already exceeding full-year FY 2025 levels, Pelatro enters the final quarter with strong momentum and a highly “sticky” recurring revenue model.