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* Revenue from operations grew by 94.1% from Rs. 4,357 million in Q2 FY22 to Rs 8,458 million in Q2FY23. There was a sequential growth of 16.0%, billable transactions increased from the 10.8 billion in Q2FY22 to around 24.8 billion in Q1FY23 to 26.9 billion in Q2FY23. Average realization per billable transaction increased from 0.294 paisa in Q1FY23 to 0.314 in Q2FY23.

* Gross profit margin expanded from 21.2% in Q2FY22 to 22.3% in Q2FY23. EBITDA grew by 77.4% from Rs. 617 million in Q2FY22 to Rs 1,094 million in Q2FY23. There was a sequential growth of 27.1% in EBITDA as well. Effective tax rate for the quarter was 11.7% going to some deferred tax credit that they had.

* EBITDA margin expanded from 11.8% in Q1FY23 to 12.9% in Q2FY23. Adjusted profit for tax grew by 102.9% from Rs. 454 million in Q2FY22 to Rs. 921 million in Q2FY23. as compared to Rs. 872 million in Q1FY23. Adjusted PAT margin was 10.9% in Q2FY23.

* For H1FY23, revenue from operations grew by 93.7% from Rs 8,132 million in H1FY22 to Rs 15,749 million in H1FY23. In terms of certain KPI, billable transactions increased from 18 billion in H1 FY22 to 52 billion in H1FY23. The company had a staggering net revenue retention of 128.0% and added over 350 new customersin the six months across all products.

* Gross profit margin expanded from 20.8% in H1FY22 to 22.4% in H1FY23. EBITDA grew by 76.3% from Rs. 1,108 million in H1FY22 to Rs 1,954 million in H1FY23. In terms of operating leverage, EBITDA as a percentage of gross profit stood at 56% for the 6-month period. EBITDA margin contracted from 13.6% in H1 FY '22 to 12.4% in H1 FY '23.

* Adjusted profit for tax grew by 115.8% from INR 831 million in H1 FY’22 to Rs 1,793 million in H1FY23. Adjusted PAT margin improved from 10.2% to 11.4% for the same period. Net cash as on September 30, 2022, was Rs 8,062 million. Average receivable days increased from 57 days in FY22 to 65 days in H1FY23, and average payable days decreased from 86 days in FY22 to 68 days in H1FY23, going to reasons mentioned or highlighted above.

* Cash flow from operations was Rs 240 million in H1FY22. Cash outflow relating to investing activities was Rs 410 million towards the payment of purchase consideration of Rs. 118 million. And the split of that amount was especially deferred payout for the email platform and advance to Teledger, and there was a CapEx of Rs. 333 million. Cash outflow from financing activities was Rs 1,604 million, primarily due to buyback of Rs 1,492 million, which includes tax. The company boarded 142 new employees during the six months period and 146 employeesresigned during the same period.

* Route mobile continues to focus on key markets like India, GCC, LAT-AM and Africa. Management mentioned that the company has started reaping benefits from investments in the LAT-AM market. India continues to be the largest market for Route in terms of revenue from termination and accounts to 47% of total revenue. Management mentioned that it continues to increase market share in India and is on track to surpass US$175mn revenue guidance from India in FY23.

* Route completed its Rs1,200 million buyback through open market channel in Q2FY23. Buyback amount including taxes is Rs1,492million. Board has also approved interim dividend of Rs3 per share.

* The company's clear growth strategy, deep customer focus and robust technology platform are tuned to deliver strong and sustainable performance year after year. We have revised our EPS estimates, We believe as the company is invested in Chile, Mexico, and Brazil which is key market growth for Route mobile within Latin will be going to benefit from FY23 onwards. We remain positive on medium-term growth prospects; its trading at 30x FY24E EPS. We maintain ‘BUY’ rating on the stock with revised TP of Rs.1,644.

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