Summary
Veranda Learning Solutions Limited - Q3 FY26 Earnings Call Summary Friday, February 06, 2026, 4:00 PM
Event Participants
Executives 3 Aditya Malik (COO), Mohasin Khan (CFO), Suresh Kalpathi (Chairman and Executive Director)
Analysts 4 Athar Syed (SmartSync Services), Deepesh J (Maanya Finance), Harshal Mehta (Zen Nivesh), Sudarsana Narashiman (Individual Investor)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Enrolments | 111,363 units | +55% YoY; Driven primarily by shorter-duration programs and the commerce vertical. |
| Collections | ₹144 crores | +46% YoY; Reflects robust student intake and strong demand for core verticals. |
| Revenue from Operations | ₹117 crores | +52% YoY; Exceptional growth attributed to operational excellence and disciplined expansion. |
| Gross Profit | ₹76 crores | +47% YoY; Gross margins improved to 65% from 62% in the previous quarter. |
| EBITDA | ₹53 crores | +328% YoY; Margin expanded to 45% due to streamlined operating expenses and leverage. |
| Profit After Tax (PAT) | ₹17 crores | Positive for the 4th consecutive quarter; Benefited from lower finance costs and depreciation. |
| Net Debt | ₹222 crores | Average interest rate at 17.23%; Currently being refinanced to sub-10% rates. |
Geographic & Segment Commentary
- Commerce Vertical (J.K. Shah): This segment remains the primary growth engine, with demerger proceedings now at the NCLT stage. Management expects the vertical to achieve a projected EBITDA of ₹200 crores in FY27, driven by strong demand for CA/CMA prep and new modular “Corporate Mitra” certifications.
- Government Test Preparation: Strategy is shifting toward an asset-light franchising model in Tamil Nadu, Karnataka, and Kerala. Plans are underway to launch online programs in Telugu and Hindi to penetrate the Andhra, Telangana, and North Indian markets, targeting a 60-65% EBITDA growth in FY27.
- K-12 & Academic Programs: Currently managing 15 colleges/schools with 5,500 students; an additional 10-15 managed colleges are planned for FY27. The segment utilizes an asset-light REIT-funded model to double school count and increase EBITDA by 60-65% YoY.
- SNVA Veranda (Vocational): A strategic partnership combining domestic brands with international networks in the US, UK, and Europe. It is projected to generate ₹250 crores in revenue and ₹60+ crores in EBITDA by FY27, with a focus on global learner pathways.
Company-Specific & Strategic Commentary
- Veranda 2.0 Restructuring: The demerger of the commerce vertical into “J.K. Shah Commerce Education Limited” is on track for an April NCLT approval and a June 2026 listing.
- AI Integration: AI/GenAI courses now contribute 40% of Edureka’s revenue; internally, agentic AI is being piloted in tele-calling, assessments, and 24/7 customer support to reduce operational costs.
- Deleveraging: Management is utilizing surplus cash flows and refinancing high-cost 17.23% debt to sub-10% facilities to move toward a debt-free status.
- Asset-Light Expansion: Future growth in both K-12 and Test Prep is being driven through franchising and REIT partnerships rather than capital-intensive owned infrastructure.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue (FY27) | ₹850 - ₹900 crores | Assumes current growth trajectories and successful integration of vocational assets. |
| EBITDA (FY27) | ₹280 - ₹300 crores | Reflects improved operating leverage and reduced corporate overhead post-demerger. |
| Bottom Line (FY27) | ₹180 crores | Expected PAT following significant reduction in interest costs and streamlined operations. |
| Managed Colleges | 25-30 Colleges by FY27 | Targeted doubling of current footprint via asset-light management contracts. |
Risks & Constraints
| Risk | Context |
|---|---|
| Regulatory Approvals | The demerger timeline (June listing) is contingent on NCLT and creditor NOCs; any procedural delay could impact the value-unlocking timeline. |
| Succession Planning | The commerce vertical relies heavily on Professor J.K. Shah’s brand; management is currently mentoring next-gen family and professional leaders to mitigate key-person risk. |
| Interest Rate Risk | Until the ₹222 crore debt is fully refinanced to sub-10%, the current ~17% interest rate remains a drag on net profitability. |
Q&A Highlights
Restructuring & Demerger
- Question: What are the material bottlenecks and timelines for the demerger? (Harshal Mehta)
- Answer: NOCs from stock exchanges and SEBI are received; NCLT filing is complete. Creditor NOCs are being finalized to skip a court-convened meeting. Expected NCLT approval by April and listing/trading by June 2026 (Suresh Kalpathi).
Artificial Intelligence Impact
- Question: Is AI a threat or an opportunity for the education business? (Deepesh J)
- Answer: It is a major opportunity; 40% of Edureka’s revenue now comes from AI courses (Aditya Malik). Internally, agentic AI is being used in tele-calling and 24/7 support to replace human shifts and improve response times (Suresh Kalpathi).
Debt Management
- Question: What is the strategy for the ₹140 crore new loan mentioned in presentations? (Sudarsana Narashiman)
- Answer: This is strictly for refinancing existing high-cost debt (17.23%). The new credit facility is expected at a sub-10% rate (9.9% achieved in some tranches), which will significantly boost PAT (Mohasin Khan).
Future Growth Strategy
- Question: How will the non-commerce business grow post-demerger? (Deepesh J)
- Answer: Focusing on franchised government test prep in new languages (Hindi/Telugu) and doubling the number of managed K-12 schools via REIT partnerships. Corporate costs will also be “whittled down” from the current ₹4 crore per quarter (Suresh Kalpathi).
Key Takeaway
Veranda Learning Solutions delivered a robust Q3 FY26, characterized by a 52% YoY revenue surge to ₹117 crores and a 328% increase in EBITDA, marking its fourth consecutive profitable quarter. The “Veranda 2.0” strategy is nearing a major milestone with the demerger of the high-growth commerce vertical, which is on track for a June 2026 listing and is expected to contribute ₹200 crores in EBITDA by FY27. Strategic moves including the divestment-cum-partnership of vocational assets into SNVA Veranda and the aggressive refinancing of 17.23% debt into sub-10% facilities are streamlining the balance sheet. Management remains focused on an asset-light expansion into K-12 management and regional test prep markets. The company appears well-positioned to capitalize on India’s growing financial services sector and offshore competency centers, providing a clear pathway toward its ₹850-₹900 crore revenue target for FY27.
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