AvenuesAI Limited (CCAVENUE) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Avenues AI Ltd. Q4 and FI26 on a conference call hosted by Co-India Advisors. As a reminder, all participants will be in the lesson only more and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I know in the conference, over to Mr. Rajat Gupta from GoIndia Advisors. Thank you, and over to you, sir.

Thank you, Dhanesh. Good evening, everyone, and welcome to FNU ZI Limited earnings call to discuss GQ4 and FY26 results. We have on the call with us today Mr. Vishal Mehta, Chairman and Managing Director, Mr. Vishwas Patel, Managing Director and Chief Executive Officer, and Mr. Sunil Bazar, Chief Financial Officer. Also joining us on the call today is Mr. D. Ravi, who is advising Irini's AI on corporate and financial strategy as an independent consultant. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risk that the company faces. I now request Mr. Vishal Mehta to take us to the company's business outlook and financial highlights, subsequent to which we will open the floor for Q&A. Thank you and over to you, sir.

Thank you, Rajat. Good evening, everyone, and thank you for joining us today. FI26 has been one of the most important strategic years in the evolution of Avenues AI. This year was not simply about financial growth. It was about convergence of multiple strategic building blocks that we've been assembling over the last several years. Payments infrastructure, merchant ecosystems, consumer platforms, AI capabilities, the regulatory infrastructure that we operate in, and international expansion. What we are building today is fundamentally different from a traditional payment gateway business. Avenues AI is evolving into an AI-first financial infrastructure and transaction intelligence platform. We believe historically fintech businesses were largely valued on transaction processing scale. And we believe the next decade going forward of value creation will increasingly come from ownership of transaction intelligence. Merchant workflows, AI-led automation, embedded finance, and intelligent financial ecosystems sitting on top of transaction infrastructure. That is the strategic direction in which we are moving. Today, our ecosystem spans enterprise merchant acquiring, consumer engagement platforms, AI orchestration layers, regulatory infrastructure, cross-border capabilities, Embedded finance opportunities, and increasingly intelligent systems. Importantly, these are no longer standalone businesses operating independently. They are now beginning to reinforce one another structurally. Our payment infrastructure through CC Avenue gives us access to a large and diversified merchant ecosystem. Across enterprise merchants, SMEs, education, travel, telecom, government, and digital commerce. Our consumer ecosystem through Redif, Redif1, and RedifPay gives us a direct engagement layer with users. Our AI platforms include our recently announced participation with AIRO, which is India AI Research Organization, and buildup of Commerce AI, Pay Central, Agent Frameworks. We are building agent frameworks in intelligent layers across transaction routing, merchant operations, fraud management, reconciliation. Compliance automation and customer engagement. When these layers begin integrating together, the platform significantly becomes more powerful than the sum of individual businesses. We believe this creates a compounding ecosystem advantage. The more transactions we process, the more intelligent the platform accumulates. The more intelligent the platform accumulates, the better the automation, risk optimization, merchant monetization, and operating leverage. That becomes out of it. And the more embedded the ecosystem becomes, the stronger the long-term defensibility of the platform. One of our major strategic priorities going forward is embedded finance and lending. We believe lending is undergoing a structural transformation globally. Traditional lending models were balance sheet driven and institution centric. The future in our view will increasingly become transaction driven, AI assisted, ecosystem embedded and asset light. Our approach is not to become a large balance sheet lender ourselves. Instead, we are building an intelligent lending, orchestration, and distribution ecosystem leveraging payments, merchant data, transaction intelligence, and AI-led underwriting capabilities. Because of a merchant network payment infrastructure and transaction intelligence, We believe Avenues AI is uniquely positioned to participate in this opportunity through an asset-light lending architecture. We see significant opportunities in merchant financing, checkout financing, working capital solutions, consumer financing, AI-assisted underwriting, transaction intelligence-based credit frameworks, and ecosystem-led financial distribution. Our strategic investments and partnerships are being designed specifically to reinforce this direction. The proposed strategic investment that we announced today in online PSB loans is important because it potentially connects us to one of India's most important digital lending infrastructure backed by major financial institutions. Similarly, our investment thesis initiatives in NBFC companies, starting with Ratnafin, further strengthens our ability to participate in lending distribution, credit intelligence, and financial product ecosystems without necessarily taking disproportionate as a balance sheet risk ourselves. We believe the combination of merchant transaction data, AI-led intelligence, lending partnerships, Regulatory infra and ecosystem distribution creates a highly scalable and capital efficient opportunity over the long term. Importantly, this also aligns with where global fintech models are evolving toward embedded finance platforms that monetize intelligence, distribution, and transaction ecosystems rather than pure balance sheet deployment. Another major strategic focus area for us is artificial intelligence. We are not approaching AI as a superficial productivity tool alone. We are embedding intelligence directly into the operating architecture of our platform. We believe AI will fundamentally shape commerce payments, all financial workflows, customer serving, service compliance, risk assessment, operations, and practically even autonomous transaction execution. Through our collaboration and participation in AI research and our broader AI infrastructure, we are positioning Avenues AI for this transition towards AI native commerce and agentic financial ecosystems. We believe future commerce environments will increasingly involve machine-assisted and machine-executed workflows where AI agents participate in discovery payments, reconciliation, optimization, and financial decisions. This is still an early-stage opportunity globally. However, we believe our combination of transaction infrastructure, merchant relationships, AI orchestration, and financial workflows gives us a very strong foundation to participate meaningfully in this evolution. International expansion is another strategic pillar for the company. Over the past year, we continued expanding our global capabilities through Middle East and gift city infrastructure. Going forward, the United States represents an important strategic focus area for us as a country. We believe cross-border commerce, global merchant acquiring international settlements, and AI native payment orchestration represents a large under-penetrated opportunity. Our objective is not merely geographical expansion. Our objective is to build globally relevant infrastructure capabilities originating from India. We are also increasingly optimistic about our strategic importance of Rediff ecosystem. Historically, Rediff was viewed primarily as an internet media and a communication platform. We increasingly see it becoming a broader consumer engagement and financial participation layer. Over time, we intend to gradually expand Rediff1 and RediffPay into areas including payments, financial engagement, Wealth, participation in brokerage, consumer commerce, intelligent communication systems, and AI-led consumer ecosystems. Importantly, we remain disciplined in how we build these businesses. Our strategy is not subsidy-led growth. Our strategy is infrastructure-led, intelligence-led, and ecosystem-led growth. We are focused on building durable long-term operating leverage rather than short-term expansion at cost of sustainability. As we enter FI27, we believe the company is moving into the next phase of its evolution. FI26 was the year where the building blocks came together for us. FI27, in our view, becomes the year where scale, intelligence, monetization, lending, AI orchestration, international expansion, and ecosystem integration, they begin reinforcing one another much more visibly. We remain extremely excited about the long-term opportunity I had. Our vision is to build one of the world's most important AI-first fintech infrastructure companies emerging from India. At this point, I will hand over the call to Vishwas to talk about payments in CCA. Vishwas, over to you.

Thanks, Vishal, and good afternoon, everyone, on the call. India's payments ecosystem is entering a completely new phase of evolution. Over the last decade, the industry focused on digitization of transactions. The next decade, in our view, will be about the intelligence layer on top of the payments, where payments become the starting point for commerce, engagement, credit, communication, and financial decision-making. At CCI Avenue, we see payments evolving from being a transaction utility into a much larger merchant operating ecosystem powered by AI. Today, merchants are not only looking for payment acceptance, they are looking for customer acquisition, engagement, financing, automation, analytics, and intelligence business tools all integrated into a single digital ecosystem. This is where we believe the future opportunity lies. Our vision is to bring CCAvenue, RediffPay, Rediff, and the broader Avenues AI ecosystem into a unified AI-led commerce and financial infrastructure platform. CCAvenue brings one of India's largest merchant payment ecosystems with deep transaction relationships across enterprises, SMEs, and digital businesses. Rediff brings communication, engagement, and consumer reach capabilities. Rilipay, Sentence, AffinTech, and Payment Infrastructure Stack. Together, these platforms create a powerful ecosystem that can enable merchants to not only process payments, but also grow, engage customers, and access financial products and operate more intelligently. Artificial intelligence will play a foundational role in this transformation. We are building AI-led capabilities across merchant servicing, fraud management, customer engagement, predictive analytics, workflow automation, and embedded finance. We believe AI can help merchants better understand customer behavior, optimize connections, improve convergence rates, and access more customized financial solutions. One of the largest opportunities we see is embedded finance and merchant lending. Through our liability-light strategy, we aim to work alongside regulated NBFC's partners, while Avenues AI focuses on merchant distribution, AI-led analytics, orchestration, and engagement infrastructure. Our merchant ecosystem combined with the transaction intelligence and AI frameworks can help create smarter working capital and business financing solutions integrated directly into the merchant's workflows. Importantly, our strategy remains asset-light and scalable. We are not looking to become a traditional balance sheet lender. Instead, we aim to build the digital intelligence and distribution infrastructure layer that powers the next generation of financial services. FY27 will therefore be a year of ecosystem integration, AI deployment, and deeper merchant monetization across payments, communications, and embedded financial services. A strategic investments and partnership with platforms like OPL and Ratnafin Capital align closely with this long-term vision. These partnerships enable us to combine regulated lending infrastructure and underwriting capabilities. With avenues AI's merchant ecosystem, payment infrastructure, AI frameworks, enterprise communication capabilities, and distribution breach to accelerate embedded finance and intelligent merchant lending opportunities across India's digital economy, we believe the convergence of payments, AI, commerce, and financial infrastructure will define the next era of India's digital economy. And our company, Avonews AI, is positioning itself to participate meaningfully in that transformation. Thank you. And over to you, Sunil Bhai.

Thank you, Vishwasar. Good evening, everyone. F526 was a strong year for Avonews AI from both the growth and execution perspective. We delivered our highest-ever annual revenue while continuing to maintain profitability and disciplined operating performance. On a consolidated basis, revenue from operations for financial year 26 increased to Rs. 8,116 crore compared to 3,993 crore in FY25, representing strong year-on-year growth of 103%. Our net revenue on a consolidated basis for FY26 increased 15% year-over-year to Rs.603 crore as compared to 526 crore in FY25. Our consolidated profit after tax for FY26 increased 58% year-over-year to Rs.332 crore as against 209 crore in FY25. Overall, the full-year performance reflects continued scaling of our transaction infrastructure business, improving ecosystem monetization, and healthy operating leverage across the platform. Coming to quarter 4 of FY26, our revenue from operations stood at 2,490 crore, reflecting strong growth of 115% year-on-year and 5% sequential growth. Our quarter-four net revenue grew 11% year-on-year to Rs.149 crore. Our quarterly adjusted pay grew strongly by 90% year-on-year to Rs.95 crore. The quarterly and annual performance was driven by continued growth in transaction processing volumes, expansion in enterprise-merchant relationships, strong traction across digital Commerce ecosystems, international business momentum, and increasing operating leverage across the platforms. Importantly, we achieved this while continuing to invest in AI infrastructure, regulatory capabilities, international expansion, and ecosystem integration. As discussed earlier, our focus remains on building long-term ecosystem value rather than optimizing for short-term decrease. As transaction scale increases, we are seeing improving operating leverage through automation, AI lead efficiencies, better payment routing, fraud optimization, and deeper merchant monetization opportunities. Another important strategic area for us is embedded finance and lending. Our approach remains asset-light and ecosystem-oriented. We are leveraging transaction intelligence, merchant data, and AI-led underwriting capabilities to participate in lending opportunities without building a balance sheet-heavy lending model. Our strategic initiatives involving online TSB loans and investments in platforms such as Ratnafin reinforce this direction and strengthen our positioning within embedded finance and lending ecosystems. As we move into FI 27, Our priorities remain focused on profitable growth, AI-led automation, ecosystem monetization, international expansion, operating leverage, and disciplined capital allocation. We believe the company is entering a phase where scale, intelligence, and monetization can increasingly compound together over time. Thank you, and we will now open the floor for questions and answers. Thank you so much, sir.

Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

A first question comes from the line of Rahul Jain with Dalit Capital.

Please go ahead.

Hello. Yeah, I would just like to understand what are the top three use cases that is driving extraordinary TPV growth for us within the payment business. And secondly, on the lending side, if you could further clarify what is the level of...

So, Rahul, I'll take the second question first. We are not going to put our balance sheet for lending. The strategy that we have applied is that we will work with NBFC companies. To be able to open up our ecosystem and that strategy will continue to percolate. What we will do selectively is to invest minority stakes in more than, you know, one NBFC. You may have heard earlier in the call, Ratnafin is the first one that we've opened up where we've taken up to 2.5 percent. And the idea here is that we are able to connect our ecosystem very tightly with such NBFCs. Where we have some minority investments, and we would allow the NBFCs to continue opening up the lending opportunities to our merchant and merchant ecosystems and consumer and consumer ecosystems. And we will work with them in building products and opportunities to be able to take advantage of. So, to your question, you know, our investment thesis in some of these NBFCs is that we want to pick up, you know, certain NBFCs with a few thousand crores of AUM. Which have a good operating history, which have scale, which are next generation, and, you know, well-run, you know, management, and we would work with them in terms of building such bridges, products, and opportunities. So does that answer your question?

Yeah, this part is clear.

Yeah, as far as, you know, the payments is concerned, Vishwas will take that up. Vishwas, you want to go ahead?

So overall, Rahul, there's been a good merchant wins that we have had in this last Q4 quarter, which has translated into a good growth of TPV. So overall, merchant transactions across thousands and thousands of our merchants were growing, and also a lot of big wins that is there. So in India, specifically on the utility, government payments, B2B payments, Everything was growing very well. So hence, that relates into the transferring into the higher TPV numbers.

Yeah, so basically, which was what I was trying to understand, if I look at the industry growth, these growth look pretty phenomenal. So there must be something that is driving this kind of attraction. So is there something which we have identified as a gap or area where we are seeing this momentum?

Yes, I think a lot of customization has come into play. Payments, you put up a platform layer over a payments layer, so it becomes a big hook for bigger merchants to stay on and increase volumes. So it makes it easier for them to go online. So multiple forms, like we launched our own form builder, which corresponds to a lot of education institutions, a lot of small merchants, a lot of event merchants and everything. So more than 5,000 merchants were onboarded on the form builder in less than a month. So a lot of growth on the platform, it's just not a vanilla payment gateway. So it's a platform plus payments play that has come. Like for the hospitality industry, now we're scaling up to more than 3,000 hotels where we're building the entire central reservation system along with the payment gateway built in. So the workflows which connects to the global distribution systems, to their own property management systems, like PR-certified with Opera systems, or Microsoft Adio, which is used by almost all the FISAs. And some of the bigger four-star chains. So it makes them easier because everything is automated end-to-end when reservation comes in through, say, any OTA like Booking.com or Hotels.com or Expedia or MakeMyTrip. It gets automated systems and payments are collected automatically. So those workflows, customization is where we are winning, putting a platform with a payment display. That's where the real growth for us is coming. Thank you.

One more thing that to add to what Vishwa said, you know, I mean, we've been very focused in terms of merchants who have signed up with us, but who have normally, you know, that merchants will be using multiple payment options, payment gateway options. And, you know, we have been very consciously going after the merchants to move processing volumes to us. It comes at a cost, but I think it's one worth making. So growth is supported by additional merchants as well as increasing share of the existing merchants that process from us.

Sure, that's pretty helpful and good to know. Lastly, from my side, on the profitability side, last year, we did extremely well on the TPV and revenue side, and our run rate seems much stronger now. Any, and I'm assuming we're investing in so many areas, which is...

So, you're right, quite a few of our... Costs are front-loaded, specifically, you know, some of the investments that we're making in the AI setup and also, you know, the opportunities that are there in front of us. So, you know, so the costs are front-loaded. But I think that in pockets we are seeing the operating leverage kicking in with scale, and we also think that the productivity that we're getting through this. Optimization and productivity gains from AI are also not insignificant in some ways. So we think that, you know, that's adding up to what we think this year will look like. I think it will be – I mean, it's reasonable to assume that it will – the profitability, we don't see a hockey stick in FY27 and profitability. We'll work very hard in terms of ensuring that we are able to get our take rates better, and that will require quite a bit of work and optimization. And we want to continue building up from where we left off in 26, and we will also invest in the RADIF ecosystem, as you are aware, which is a very large opportunity that we believe is in front of us. So I think that it's reasonable to assume that it will be, you know, similar to what we have seen in the past year, as FY27 should be. But we'll give guidance in the first quarter call for the full year.

Thank you. Thank you, and the best of luck for the time.

Thank you. Our next question comes from the line of Amish Kanani from Novice Investment Managers. Please go ahead.

Hi, sir. Congress on a decent performance. Sir, while we have grown in payment type, if I look at the segment, I think e-commerce platform is, you know, kind of degrowing. So, once you can explain. Why this is happening? Because that's a high margin business for us. And in that context, you know, we have noted that ready first file for a confidential DRHP, but whatever you can share in terms of, you know, their financial and or, you know, plans, you know, for the year, any timelines that we should look for in quarter, you know, where we probably have planned that IPO, that will be helpful.

Sure. So, largely we've seen, yeah, you're right, the platform business is slightly flat to, you know, slightly high. So, I think that overall we have not seen big growth in that business. You know, the full year, if you look at full year, and I'm not talking about the quarterly, quarterly, you'll have some changes, of course, as you go through, but if you look at the full year numbers in the segmental, you'll see that they're somewhat flat to slightly higher. I think that As we build out, and fortunately for us, with the AI-first approach in terms of building out frameworks, you'll see a lot more activities on the platform side in FY27. And what Vishwa said is also true, which is we'll combine the platform and the payments more, which actually increases quite a bit of our stickiness. We think a lot of secret sauce lies in that. So you'll see some amount of growth in that business. That comes from a combination of building up a suite of new products and also opening up our existing frameworks internationally. We think international is a fairly large opportunity in the platform space, and given the currency rates and so on and so forth fluctuations, we believe that international focus will be a big area to look at going forward. So that's as far as the platform business is concerned. You know, your questions around Rediff, you know, yes, we have filed a confidential DRHP, you know, given the regulatory, you know, compliances. We are not able to share, you know, anything additional at this time, but what we will do is we'll keep. I think that there's, I mean, Rediff, I can tell you, Rediff has got, you know, a lot of consumer interactions going, not just merchant interactions. And given the macroeconomics of data, data privacy, and sovereignty of data, you know, there's a lot of incentives for very large institutions and merchants to move to a sovereign stack. And I think that that's where we are seeing a lot of movement, you know, at this time happening. You know, last year we were just focused on moving these merchants and large merchants and institutions onto our framework. But we believe that, you know, it becomes a very large opportunity in 27 and 28 to build up upon, because that's when we can offer a lot more services to the existing merchants. And then we're also working on Rediff Pay, which is a consumer-facing UPI app. It's actually live and in production. And given, you know, the recent launches and also the number of transactions and being able to ensure that we are stabilizing and then, you know, scaling it up, the team has been working on it. But you can try it out. And, you know, you'll hear a lot more about those kinds of activities which are consumer-facing in the coming weeks.

Oh, sure. And so... Any new launches that Rediff has done and what kind of investments, you know, we'll be making this year, which may, you know, kind of probably, say, affect our overall margins, or are we going to keep, say, our overall, you know, console margin in mind while, you know, kind of calibrating the investments that Rediff might make? So, one, given the IPO money that they may receive and the investment that they may make, should we worry about our consolidated margin getting affected, and that's one. And overall, any sense of the CapEx guidance, one, you know, we have made some investments in NVFCs, so including those types of investment. The CapEx guidance, if at all, you can share with us, you know, across investments in NVFCs. Overall CapEx guidance on the infrastructure that we are building and the Redis that, you know, Redis as a platform might make for the year.

We see pockets where we see expansions and margins, and we will also incur capex, and we see – the payment gateway business is somewhat – there is margin pressure. So I think a combination of that is, of course, playing out. But, yeah, we believe the margins should continue. I mean, in terms of consolidated basis, we should continue seeing similar numbers or maybe slightly higher, which will guide you at the end of first quarter. But, yeah, in terms of the CAPEX, you know, we, you know, have certain guidelines and policies that we are not able to, you know, share a lot of information about specifics on Redef. What I can tell you is that You know, Redif should see, you know, Redif is going to be, given the platform framework is part of Redif and also growth is there, today most of the Redif business is B2B, you know, which is, you know, being able to offer frameworks and platforms to companies. But given the opportunity with Redif B and also, you know, Embedded Finance, Thank you.

Go ahead, Vishal. I think there's some other background noise. You may go ahead.

I think we lost Rassal. But just continuing on that, just continuing on that, yes, a lot of momentum growth will be there in Rediff. As and when the final, we are there at the IPO level, we'll give out more details.

Oh, sure, sir. And one last suggestion, sir, whenever it's possible, you know, if you can share Redif, you know, line items separately, even at a very broad level, you know, say revenue and EBITDA, that will help because, you know, going forward, maybe, you know, there will be a SOTP kind of valuation which might emerge if and when we get Redif listed. So some, you know, scratch bare detail on Redif will really be helpful. Thanks, sir.

Absolutely. Absolutely. Thanks. Amish, have you done with your question? Yeah, yeah, thanks, sir.

Thank you. Our next question comes from the line of Sri Ganesh Barugucerla from Shib Capital. Please go ahead.

Yeah. Congratulations for the good numbers.

I have only one question that how much of the current transaction routing through the AI-assisted versus rule engine-based?

So, I mean, if you come to think of it, AI is in all facets of transaction processing. So, in other words, you know, what we do is, you know, traditionally, you know, I mean, if you – I'm assuming your question is around, you know, how much is automated and fraud-checked using AI and AI frameworks compared to humans or rule-based engines. You are right. Yeah, and so I think that, you know, fortunately for us with two-factor authentication in India that the fraud rates are pretty low, and we think that, you know, with, you know, this AI-based frameworks have been evolving. We've been checking and, you know, building up, but I think not just, you know, I can tell you for sure that. You know, practically, you know, in all different areas of payments, we are using AI. So, in one way, we can say that all of our transactions will have some component of AI-based, you know, checks and validations, you know, that are happening across the company. I mean, I could say all of the transactions, but if that makes sense.

Okay. Thank you so much.

Thank you. Next question comes from the line of Sanjay Malik with Champion Enterprises. Please go ahead.

Yeah, thanks for the opportunity. Can you hear me? Hello.

Yes, we can hear you, sir.

Yeah, go ahead. Yeah, thank you so much. Yeah, so I have two questions. One of them is linked to the question just now asked of you. You know, I, in fact, I just become a small shareholder, but I'm more keen to understand how AI will manifest. And from the outside, the best way to understand that is to see the sort of metrics. Personally speaking, today, someone might say CC Avenue is a payment company that talks about AI. But from an investor standpoint, I think it's important that... AI is already becoming a measurable revenue-generating business line, and for that, there are a number of areas, and this is more of an observation. You don't need to answer the question. It's more of an observation, but please feel free to comment on it. So if there was some sort of AI revenue disclosure in terms of merchant adoption, revenue per merchant, how much of your processes, you know, the queries, the frauds, the recommendations, the underwriting decisions, the fraud management that you talked about, there are so many metrics which are AI related partially or entirely. There can be a slide or two. That gives us that kind of confidence on how you're tracking on AI. I think then you can call yourself an AI company and not a payments company talking about AI. I think you're going there, but I'm not able to fully grasp it. So that was the first part. And the second part also is somewhat connected. And I've been a banker for many years. And I've seen a lot of banks, payment banks. You know, fintechs completely come undone, either because they flouted a regulatory license or they have not kept pace with technology. You see what my thoughts is showing up in so many banks. You see what Andromeda is doing to someone like, you know, all the pop-ups and the cookies. So everything is changing so quickly. It's very important to understand how you're managing your risk and whether there can be some sort of risk management slide. Because to me, apart from AI, the only other key issue in the company is operating risk. And if something goes wrong there, you don't get a second chance, especially not from the regulators or someone who's trying to hack your system. So I'm very keen to understand if you have any comments on these two observations. And I think other than that, you have a very interesting trajectory going forward.

You know, thanks, and also thanks for the question. You know, something that we think about all the time. So, you know, we always think that, you know, in some ways, you know, pretty much what you said, the best metrics to track, you know, are the ones that clearly show improvements in efficiency scale,

you know, merchant experience, risk management, and, you know, somewhat monetization at the end.

But, um... The things that internally we would want to track in some ways are things like the payment success rates driven by intelligent routing using AI, some reduction in transaction failures, and in some ways the way you would want to get productivity through onboarding turnaround times and increase the cross-sell across the ecosystem products. Think about risk and fraud, you'd want to think about. I mean, internally, we look at things which are like, you know, the detection times, the response times, and the transactions monitored through the AI-led risk systems, and so on and so forth. And in terms of efficiencies, we'd look at, you know, all the way from customer service support resolution times to, you know, the reconciliation settlement turnaround times introduction and all these manual overloads and operating overloads. But, you know, pretty much the answer to the question which was asked earlier, which is, you know, what percentage of the workflows are automated using AI systems and this productivity gains.

This is the key, we think, in terms of,

you know, the opportunity, and this is how we think, and our mental model is also evolving because it's a moving, you know, target. But we think that we need to think of this. The opportunity of AI, not just as a technology productivity gain or an experiment, but as a driver for our efficiency risk management and a long-term operating leverage. And, you know, I mean, that's how we look into this, at least, you know, and so far we think that AI is just not a separate initiative. It is increasingly becoming embedded all across our platforms, and we are leveraging across fraud management and analytics and customer servicing and intelligent transaction routing and all the lending-related risk assessment that we plan to do going forward to enhance both. Scalability and somewhat the margin expansion going forward. So, I mean, that's how our approach is, not just simply deploy AI on a standalone feature, but to integrate it as a layer across our payments, commerce, and financial services to build somewhat an efficient platform over time. So this has been our thought process so far. Your point about actually You know, specifically talking about AI as a separate line item, given that we are not just a services company, we're more of a product company AI. You know, historically, we've seen services companies segregate their revenues on AI and non-AI. If you, yes, there are some cloud service providers who do that in terms of, you know, the large ones, including Microsoft and others, or data center providers. You know, we're somewhat embedding AI into all different aspects of what we do. And so as a result, we think that, you know, just embedding AI across all these multiple layers of our organization is a focus on... And so the key areas that we need to leverage is perhaps the way we need to think about it. We do have specific EI revenue as well, which, you know, from a size of the P&L is not, you know, material, but we think that there's a lot more potential in that as and when it becomes, you know, large enough that we would want to talk about it, and you'll hear more and more of that, you know, in this year from us. But I think that's how we think about it. To your points about how we would want to manage risk and so on and so forth, and you mentioned Mitos and a few other security vulnerability issues and so on and so forth, it keeps us up all the time. We don't know too much about that because the new frameworks are coming up by the day. You know, I mean, I think only a handful of companies have access to such large frameworks given the amount of, you know, scrutiny and so on and so forth that come along with it. But, you know, I think that we'll evolve. We'll have to learn. I mean, much like us, even banks will have to build up on that. And I think that, you know... You know, a lot of things are new in that space, but there are good, great compliance standards in place even today. That much I can tell you, and I think that, you know, this exposure that comes in is about a small vulnerability in a piece of software which, you know, which is not patched, which was not even known. And that risk is now becoming significantly more and something that we have to keep on. Keep on reviewing and looking at, and we also have a lot of compliances on data, data security, and DPDP, and many others. So I think, you know, a proper, you know, framework in terms of... Looking at it is very important. And more at a capex level, we look at three things, which is in the world of AI, genuinely, we think there's only compute, algos, and data. At the end, abstract it out to these three. And so we think that, you know, we don't have a very large role to play in compute because we are not a chip design firm, and we don't manufacture chips, and we are not going that route. So we just think that we have to work on algos and data. And that's where we are at at the moment and apply it within our embedded ecosystem. So I know it's a long answer, but, you know, hopefully in the coming quarters we'll be able to... And specifically, when we gain significant traction, not just from our embedding of AI within our ecosystem, but also direct revenues coming from certain products that we've built out in AI that potentially have a lot more interesting use cases, which we believe there are, that we'll be able to share that as well going forward.

Yeah, thank you. Thank you very much. Only recommendation is if at all, whatever fabric of your organization and whichever process, front, middle, or back end, to the extent possible, you can disclose what part of that is AI. That will really help people understand where you are in that AI journey.

That's a good suggestion. Thanks. We'll take that up.

Thank you so much for your feedback.

Thank you, Sanjusa. Ladies and gentlemen, anyone who wishes to ask a question, may press star N1 on their touch on telephone. Our next question comes from the line of Anita Bajaj from SK Advisors. Please go ahead.

Hi, good evening. Thank you for giving me this opportunity and also many congratulations for your great setup number. So first, I wanted to understand that if AI agents increasingly execute commerce autonomously, does the control point of the ecosystem shift away from merchants towards orchestration platforms like Avenues AI?

Um...

I think there is – it's a slightly loaded question, but the way I think we need to think about agents is that, you know, there is agents and who is the custodian of that agent. So in a classical way, you know, what you do is intent and execution. They're two separate things. And, you know... As a company, we'll provide a framework for someone to build an agent, and then there are guardrails around that agent, and then there are control mechanisms to an extent of a kill switch, which has been given to the custodian of the agent. The important part is that, much like you can imagine that what the agent would need to execute will always stay in the control of the merchant within the merchant ecosystem. But if Avenues AI is providing the agent for the merchant to do certain tasks and activities at the back end, you know, technically we are an infra provider, but the control mechanism of the merchant will always be, or the agent will always be with the merchant. But it gets slightly more gray area because we are also the custodian and we provide the framework to build the agents.

So I think a lot of this is likely...

You know, I mean, you know, it's new to all, and we have built out payment agents as well, just so that, you know, so in other words, you know, using the protocols which are out there that, you know. A classical example is a customer can go and say that, you know, I want to buy a ticket from, say, Amdavad to Bombay. And so it is a discovery agent on the site that will actually go discover the lowest cost and whatever it may be and give you that information. And then once the intent is given, the opportunity for the customer to give intent is always in the control of the customer. And I'm just using one use case to perhaps walk you through how we think through it. So the customer control is always with the customer. It is never with the agent because the intent comes from the customer. The agent is executing on that intent. And so I think from a customer perspective, we don't think that the agent can take over the customer intent at any given point in time because that would be a huge risk, if you will. So that's one part. Once the agent is able to go and discover and find the right, you know, set of, you know, search results, and if the customer wants to purchase, you know, a particular sector of tickets or whatever it may be, that intent goes into a command to execute. And that, again, comes from the customer. It can't be an agent which will just run the command by itself. But at that point, you know, that execution will go from a discovery agent to a payment agent. So there will be an agent-to-agent protocol transfer that happens. And that payment agent is actually going to go again to Avenue's AI payment framework, whether it's through MCP, I mean, or it will go directly into executing that if the merchant is integrated using CC Avenue. And once that happens, again, you know, the two-factor authentication is still in the hands of the customer, which means that they can't execute, or an agent, a payment agent cannot execute the command without the customer finally going and saying that, yes, I'm going to verify because a two-factor authentication is required. And once it executes, it will again give it back to the...

And the site agent gives the information back to the customer.

So I think in some ways we think, you know, the intent of the customer will always be safe. The intent of the merchant will be more around the amount of guardrails and the controls that you would want to set as a merchant onto your own agent. And then there'll be infra providers, in certain cases us, who provide the agent framework for someone to create such agents. And give the controls in the hands of the creator. And creator in this case would be a merchant or creator in this case could also be a software developer working for a merchant. And you will have pretty much all the guardrails and the metering and everything else on the agent that potentially also safeguards the interest of the person who controls the agent. So I hope that makes sense. We don't see the control moving to us easily.

Thank you so much. And my next question is that, where do you believe the largest long-term profit pool will kind of emerge from? Will it be, like, is it payments, AI orchestration, or lending software, or transaction intelligence?

I think transaction intelligence is an input into the profit pool. It's like the most important input in a profit pool. So if the output is profits, then the input is the transaction intelligence. And that's what we are after, which is, you know, that becomes the monetization on merchant data, distribution, credit, automation, and all the workflows built on top of payments. So, I mean, the biggest value creation is not Merchant MDR alone. You know, it becomes, you know, in some ways we believe in intelligence, and that's where we think the opportunity lies.

Right. Thank you. Thank you so much.

Thank you.

Our next question comes from the line of Ayushi. Please go ahead.

Hi. So, my first question is regarding Xtues. So, we had acquired Xtues in 2024, acquired a 20% stake for $10 million. So, I wanted to ask about what is the status with respect to the company? What is the turnover? Where are we at? Because... Yeah, I think I expect an answer for that first, and then I'll ask my follow-up questions.

Yeah, so we have not acquired. We have taken 20% in ExDuce. You know, the participation of ExDuce comes up in the share of associates of the company. I think, you know, ExDuce is based out of the United States. This year, as a company, we will want to expand, you know, international payments. And in the United States also. And, you know, so, yeah, we invested both on the regulatory RBI clearances. But I think they don't show up directly in our balance sheet. They show up as a share of associates in our books. I think we have got a lot of opportunity because once we build out more infrastructure in the U.S., we will have more collaborative partnerships with. We've invested in and become strategic in some ways for us going forward. So I hope that answers the question. But, yeah, I mean, Specifics around, you know, associate companies, you know.

Sir, I have two follow-up questions to that. Sir, actually, your answer doesn't give me a lot of confidence right now, because when we acquired Xtuse, the board had stated two specific objectives. One was that we were embedding Chromatic AI into Xtuse's framework, and second was we were growing CC Avenue's U.S. payment business. So, since that investment, Xtuse has made at least two... Significant capital deployments that are entirely unrelated to the subjectives, and I think you would probably know about that more than I do. And so, at that point, also, you had told that our international revenue, that the 30% target for international revenue was made in February 2024. So, as of now, also, we are not close to that number. So what do you expect us to, you know, believe that, you know, even five years down the line, if you don't reach that number, you're just supposed to wait?

No, so I think the way we think about this, and, you know, thanks for bringing this up. So the way we think about, you know, the opportunity is that AI deployment, and you'll read a lot of reports, what the mental model was about a year and a half, two years ago is very different than what the reality is today. So enterprise adoption of AI has been slow. And if you read the recent news, you will also realize that companies like OpenAI, they've set up, I mean, in some ways, investments, even as recent as last quarter, where they said that we will implement it for enterprises. Because... You know, historically, you would have seen that companies which are into software development would actually go and say that, you know, we know how to implement and give productivity gains to you, so let me help you implement AI within your organization. But, you know, you'll see a number of reports out there saying that enterprise adoption of AI has been very, very slow. In many cases, many of them, they're even, you know, not very bullish about it. And the reason is nothing else. The reason is that enterprises have their own, you know, challenges. And within those enterprises, unless there is a team that can come in who provide end-to-end solutions, you know. OpenAI has been working with even companies like Accenture, and there are reports that Accenture may be at risk given that OpenAI is getting into implementation. But the reason they want to get into implementation is because it's slow. And so the mental model maybe two years ago was that, yes, large enterprises like Morgan Stanley, Goldman Sachs, all of them, they adopt AI every nook and corner of it, and there won't be jobs, and you'll be seeing reports on that. But, no, it's changed. So, yeah, I think that, you know, as a company, we would make bold bets in terms of – we don't control the adoption as much as we would like to, but you would want to make such bets saying that, yes, it's worth it. It will stand the test of time. It's just not that there's some latency involved. So that's one. And so I think that each company will want to do what they would think is appropriate in terms of their build out. So we can't comment on specific investments and what they'd like to do. But what I can tell you is that, you know, two things have happened. One is our focus last year has been on Middle East. And growth in Middle East and Saudi and some of the Middle Eastern countries because we thought that we had achieved certain scale penetration and we should continue building up. And U.S. was there in the horizon, but it was not an important geography to focus on because we thought that Middle East was seeing a lot more traction. And where we think that we have lighted a small fire, we pour gasoline on it, it becomes larger. This year, we will pick up U.S. because of the macroeconomic risk in Middle East, and we are also seeing a lot more activities happening in the U.S. So, you know, to us, we don't think that, yeah, we were wrong in terms of thinking that, you know, AI adoption in such, you know, large financial enterprises will become much cleaner, faster, and companies can provide, you know, services to them who already have MSAs with large enterprises. So, to that extent, of course, we were wrong. The rate of adoption for large enterprises has been slow, but on the other hand, we also believe that there is a lot more going on, and once there is an adoption that starts, because the frameworks have also evolved, the cost of tokens has also been, you know, some people say it's higher, some people say it's lower, but that's also being optimized. We think that it stands the test of time. I think it'll work. It is just that it will take time to adopt and, you know, maybe we were slightly ahead of our time in terms of, you know, our approach to apply. In fact, if you come to think of it, even other than productivity tools, you know, and coding and many others, enterprise adoption has been very slow. So, I think that, you know, that thing will always happen in a new technology. We think that it's a bet worth making. It's one that we won't get all our bets right in terms of timing, but it stands a test of time. It will work because we will take it forward.

This is universal, not just specific to us, actually. So, AI adoption is slow.

We know that Exodus, basically, they made one investment in a U.S. cybersecurity firm, and the other investment in Dave Information Technologies, which is an Indian-listed company. So, I think they spent around 12 crore rupees in that particular transaction. So, the Infibium's board would have probably given approval for Exodus to deploy, redeploy the money that you gave them, right? What does Infibium think about that? Because if, you know, they're not using it according to your stated objectives, it is a concern for me as a shareholder.

I think that's an incorrect statement. We don't participate in the board of XTU's, and we don't allocate their funds. They have their own control mechanism, and they have their own opportunities that they would want to explore. And just so that you know, they've been a profitable company. They make a few million dollars every year. So I think I don't see any reason why we would want to control what, you know, specifically about how firms who derive most of the revenues out of the U.S. would perform and what they would work upon going forward. But what I can tell you is that, yes, we think that – You know, whatever we want to build up and however we want to think about growing this position, that, you know, we have – we think that there's a lot more opportunity going forward. And I think that, you know, that will specifically in two areas that we think, you know, because we don't have. You know, direct MSAs with large, you know, financial institutions who are based in the U.S. and New York, we don't have MSAs, and typically an MSA would perhaps take you six to 12 months, maybe two years even, to sign a single MSA. So we think that when the enterprise adoption of AI picks up and we are able to build out a lot more, you know, this year in FY27, that we'll have more collaborations going forward. So, I don't think that, you know, we would have much to say in terms of, you know, what, you know, some of those decisions on capital allocations happen at that point.

Thank you, sir. Participant has left the queue. Ladies and gentlemen, that was the last question for today. With that, we conclude today's conference. I am now in the conference over to the management for the closing remarks. Thank you, and over to ETA.

Yeah, so thanks all for joining our full-year Vira Investor Call, and we look forward to keeping everyone updated on the progress. You know, have a good day.

Thank you so much, sir. Ladies and Sentiment, on behalf of Co-India Advisors that conclude this conference, thank you for joining us and we may now disconnect your lines. Thank you.