Financial Performance Highlights

Full Year FY2026 (Ended March 31, 2026):

  • Revenue from operations: ₹270 crores, up 23% Year-over-Year (YoY)
  • EBITDA: ₹18 crores (vs. ₹25 crores in FY25)
  • Profit After Tax (PAT): ₹11 crores (vs. ₹14 crores in FY25)
  • Return on Equity (ROE): 15%
  • Return on Capital Employed (ROCE): 22%

Second Half FY2026 (H2):

  • Revenue: ₹60 crores, up 72% YoY
  • EBITDA: ₹2 crores (vs. ₹6 crores in H2 FY25)
  • PAT: ₹0.4 crores (vs. ₹3 crores in H2 FY25)

Key Operational & Strategic Updates

Strategic Investments Made in FY26 (Meta 2.0 Transformation):

  • Leadership & Talent: Strengthened management team by onboarding industry veterans. Employee strength increased from 265 to 309. Percentage of employees with core technical expertise increased from ~50% to 90%.
  • Geographic Expansion: Expanded beyond Mumbai into Delhi, with increased focus on Bangalore, Chennai, and Hyderabad. Pune expansion planned within 1-2 months.
  • Vendor Partnerships: Onboarded 12 new cybersecurity vendors, expanding capabilities into AI security, microsegmentation, OT security, and post-quantum cryptography. Now has 8 "focused vendors" and 4-5 "non-focused" vendors.
  • Business Mix Shift: Strategic shift towards higher-margin cybersecurity services, which contributed 75% of FY26 EBIT. Aiming to increase service revenue contribution from 13% to 25-30% over three years.

Order Book & Visibility:

  • Order book stood at ₹506 crores as of May 27, 2026.
  • This provides 1.9x visibility over FY26 revenue.
  • Order book is executable over the next three years.

Factors Impacting FY26 Profitability

Management cited two primary unforeseen factors that negatively impacted profitability:

1. Foreign Exchange Loss: A large deal with a private bank customer (Zscaler vendor) incurred a loss of "couple of crores" due to dollar fluctuation (INR moved from ~85 to 88-89). Future contracts will use "Spot Plus 2" billing to mitigate forex risk.

2. Vendor Acquisition Impact: Imperva, a key vendor, was acquired by Thales. This disruption caused services revenue from this stream to drop to ₹2 crores in FY26 from ₹8.5 crores in FY25 against an expected ₹10 crores. Meta is now a global Professional Services (PS) partner for Thales/Imperva and expects to recover to ~₹10 crores (₹6-7cr from Imperva + ₹3cr from Thales) in FY27.

Despite these headwinds, the company maintained its gross profit at ₹49 crores, consistent with FY25.

Management Guidance & Outlook

Three-Year Aspirational Target (FY26 to FY29):

  • Target to grow Profit After Tax (PAT) by up to 4x from the FY26 base of ₹11 crores.
  • PAT margins are targeted to improve from 4% to over 10%.
  • Growth expected to be gradual year-on-year.

FY27 Specifics:

  • Employee base is projected to grow from 309 to 370-375.
  • Service revenue is expected to grow by a minimum of 25% from the FY26 base of ₹36 crores.

Growth Drivers outlined:

  • Expansion into international markets (Gulf, Australia, APAC, US).
  • Pursuing high-margin service opportunities and phasing out low-margin (<5-6%) product business.
  • Leveraging new vendor partnerships and next-gen cybersecurity capabilities (AI, OT, Quantum).
  • Forming strategic alliances with other companies globally.
  • Benefiting from operating leverage on investments made in FY26.

Capital Structure & Cash Flow

  • The company stated it does not anticipate a need for further equity or debt fundraising for its growth plans.
  • Explained negative operating cash flow was due to timing issues (tax payments, inventory) and expects this to resolve.
  • Loans on the asset side (~₹13.8 crores) are primarily advances for property purchase, security deposits, and employee advances.

Analyst Q&A Key Points

  • Revenue Seasonality: H2 revenue typically dips due to a single, large (~₹100+ crore), low-margin product order from a major private bank that is executed primarily in H1. This contract is valid for three more years.
  • Customer Concentration: One large banking customer contributed ~50-55% of FY26 revenue.
  • Attrition & Talent Strategy: Industry attrition is 25-40%; company attrition is <20%. Mitigated by maintaining a bench of 15-25 employees and a structured training program for freshers.
  • Distribution Model: For most vendors, products are purchased through local distributors (e.g., M.Tech, iValue). Zscaler is an exception where Meta buys directly as a privileged partner.