Vakrangee Softwares Limited

Creating Value by Empowering Rural India with Financial and Social Inclusion

INVESTOR PRESENTATIONA u g u s t 2 0 1 3

Vakrangee Softwares Limited

This presentation and the following discussion may contain “forward looking statements” by Vakrangee

Softwares Limited (“VSL”) that are not historical in nature. These forward looking statements, which

may include statements relating to future results of operations, financial condition, business prospects,

plans and objectives, are based on the current beliefs, assumptions, expectations, estimates, and

projections of the management of VSL about the business, industry and markets in which VSL

operates.

These statements are not guarantees of future performance, and are subject to known and unknown

risks, uncertainties, and other factors, some of which are beyond VSL’s control and difficult to predict,

that could cause actual results, performance or achievements to differ materially from those in the

forward looking statements. Such statements are not, and should not be construed, as a

representation as to future performance or achievements of VSL.

In particular, such statements should not be regarded as a projection of future performance of VSL. It

should be noted that the actual performance or achievements of VSL may vary significantly from such

statements.

Safe Harbour Statement

2

PROJECT:

AADHAAR (UIDAI)

?KNOWDO YOU

VSL is the leader in all three categories namely

number of Aadhaar cards generated

data uploaded

number of residents enrolled (over 30 million till date).

Vakrangee Ltd. Swathy Smartcards

Ltd.

Wipro Ltd.24

25

26

27

28

29

30

31 30.4

27.8

26.5

• UIDAI's mandate is to issue every resident a unique identification number linked to the resident's demographic and biometric information.

• Vakrangee has been empanelled in the highest category i.e. T3F4 category permitting it with pan-India enrollment activity.

Vakrangee Softwares Limited 3

No. of Aadhaar Cards generated (In Mn)

The Inclusive agenda of the Government consisted of enrolling eligible population into the electoral rolls, thereby enabling them to participate in the election process and governance.

across

PROJECT:

ELECTORAL DATA FOR UTTAR PRADESH

?KNOWDO YOU

of the state of Uttar Pradesh.and Delhi.

gram panchayats38,475million people95

VSL has managed unprecedented success in the collection of electoral roll data of around

Vakrangee Softwares Limited 4

Registrar Offices

168million20

PROJECT:

INTERNATIONAL E-GOVERNANCE PHILIPPINES

?KNOWDO YOU

VSL has Successfully completed dematerialization of 20 million land deeds for 168 Registrar of Deeds offices across the nation of Philippines.

Philippines

To dematerialise land deeds and introduce paperless digital record keeping for 168 Registrar of Deeds offices across the nation of Philippines.

Vakrangee Softwares Limited 5

In February 2012, RBI allowed non-banks to setup, own and operate White Label ATMs (WLAs) which would provide ATM services to customers of all banks.

PROJECT:

FINANCIAL INCLUSION

?KNOWDO YOU

VSL has been granted “In-Principle Authorization” by RBI for setting up WLAs in India.

VSL will setup, own and operate

Vakrangee Softwares Limited 6

VSL will be entitled to receive transaction fee from the banks for the use of VSL ATM network by the bank customers.

Additional Revenue through advertisement and other value added services as per the regulations.

under its own brand in

years across the country3minimum WLAs15,000

RBI, Ministry of Finance & GoI wanted to expand the Bank Branches to the unbanked regions in the country as part of Financial Inclusion Initiative, allowing the banks to appoint BC & BF to extend their outreach of financial services in the rural areas.

plus Branches are already up and Operational !!

3,000PROJECT:

FINANCIAL INCLUSION

?KNOWDO YOU

Exclusive mandate to set up & manage 50,000 bank branches (Ultra Small Branches) for the states of Maharashtra, Rajasthan and Delhi.

Allowed to Offer G2C as well as B2C services at these Branches, thus resulting into an Exclusive Rural Retail Outlets.

Vakrangee Softwares Limited 7

Vakrangee Softwares 8

VSL - RURAL RETAIL MODEL

• Exclusive• Scale without Capex• Economy of Scale & Scope• Negative Working Capital

Vakrangee Softwares Limited 8

Vakrangee Softwares 9

WHY UNIQUE ?TRADITIONAL

RETAIL MODELVSL

RETAIL MODEL

CAPEX HIGH LOW

HUMAN CAPITAL HIGH LOW

WORKING CAPITAL HIGH -VE WORKING CAPITAL

FOOTFALLS VARY ASSURED FOOTFALLS

RETAIL CATEGORY MAINLY PRODUCTS MAINLY SERVICES

INVENTORY HIGH JUST IN TIME

Vakrangee Softwares Limited 9

YOU

KNOW

DID

Vakrangee Softwares 10

EXCLUSIVITY

Exclusive Mandate to offer Banking services at 50,000 outlets.

Exclusive Portfolio of G2C services where VSL is empaneled as an enrolment agency.

Strong Back end already created for processing several B2C services.

Vakrangee Softwares Limited 10

YOU

KNOW

DID

Vakrangee Softwares 11

SCALABILITY

Expansion - 16x from 3,000 outlets at Q1FY14 to 50,000 outlets by end of FY15.

Highly evolved business model - Technologically driven real-time rural connectivity till the Gram Panchayat Level.

No Major Capex requirement as Expansion mainly through the Franchise Model and Resources already in place at the Grass Root Level…

Economy of Scope – As more New services are added under the same Infrastructure benefiting from High Operating Leverage.

Vakrangee Softwares Limited 11

We are the last-mile link that connects rural citizens with India’s modern ecosystem.

Vakrangee Softwares Limited

About Us

Current Profile

Evolution & Transformation

Advantage Vakrangee

The Market Opportunity

Understanding Business Model

Summary Outlook – Next 3 Years

Annexure

Discussion Summary

Vakrangee Softwares Limited 13

About Us

Pedigree & Execution Capability

Strong Financials

• India’s largest E-Governance player with 20 years of E-Governance focus.• In-depth experience of handling various E-Governance projects including

Election Automation, PDS, UIDAI, CSC, FI, IGRS and many more.• Strong track record of delivering time-bound mission critical projects having

large foot-print across geographies.

• Revenues, EBIDTA & PAT for FY13 are Rs. 15,558 mn, Rs. 3,912 mn, & 1,093 mn and have grown at a CAGR of 53.7%, 69.7%, & 66.9% respectively over last 3 years.

• Current FY13 ROCE stands at 27.0%. Total debt is around Rs. 4,309 mn resulting into Net D:E at 0.8x.

Credentials

• Part of all Mission Mode Projects (MMPs) over the last 2 decades i.e. MCA 21, RSBY, Passport Seva Kendra, UIDAI etc.

• Largest Single System Integrator (SI) for all the Key Government Projects upholding the Largest Democracy.

• Empanelled in the highest category i.e. T3F4 category for Select Government Projects i.e. UIDAI - Adhar.

• CMMi level III organization, ISO 27001, ISO:IEC 20000 Certified• Included in CNX 500 & BSE 200/500 & Mid-Cap Index.

Business Transformation

• BFSI - Exclusive mandate for 5 + 2 years to setup & manage 50,000 bank branches in the states of Maharashtra, Rajasthan, and Delhi.

• RETAIL - Allowed to provide B2C as well as G2C services at these Outlets, Thus resulting into Exclusive Rural Retail Marts.

Vakrangee Softwares Limited 14

About Us – Strong Management

Dinesh Nandwana Chairman & Managing Director

Chartered Accountant with 22 years experience in overall Management, Operations, Finance & Corporate Affairs.

Has led the evolution of Vakrangee since inception by ensuring continuous advance and improve e-Governance solutions leveraging world-class technologies, processes and people

Santosh DashCEO – Retail & BFSI (Global)

An IT veteran with an MBA gold medalist and B.Tech. More than 18 years of experience in blue chip organizations like PwC, IBM and ICICI and expertise in BFSI, Agri, Retail and Govt business

Pradeep KumarCEO – Government Business

Ex IRS officer with a MBA and B.Tech in telecommunications, has 18+ Years experience in Global business development and execution of large public sector IT projects.

Dr Nishikant HayatnagarkarDirector – R&D

PhD in Computer Science from I.I.T. (Mumbai), with experience of 24 years in the field of software and chip designing, Leads the SI LOB for Vakrangee.

Vakrangee Softwares Limited 15

About Us – Financial Overview

FY11 FY12 FY13

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

8,903 13,578 15,558

15.7%18.1%

25.1%18.9%

23.5%27.0%

Revenues (Rs. Mn) % EBITDA Margin % ROCE

Last 3 Year Financials As on 29.7.13 (BSE)

Market capitalization (Rs. Mn)

33,220

Price (Rs.) 66.05

No. of shares outstanding (Mn)

502.96

Face Value (Rs.) 1.00

52 week High-Low (Rs.) 85.90 – 38.25 Key Institutional Investors % Holding

Life Insurance Corporation of India

6.45%

Pro-moter39%

FII0%

DII7%

Public54%

Shareholding Pattern – June 2013

Vakrangee Softwares Limited 16

Evolution & Transformation – Phase I - 1990-2011

Computerization of Central Election Commission

1993

MCA 21 – Ministry of Corporate Affairs2005

Land Record digitization in UP2007

RSBY – Smart Card Project - UP. Haryana & Rajasthan

2008

Passport Seva Kendra Project CSC Punjab

2010

UID Enrolment – ALL INDIA ProjectUID linked Haryana PDS Project

2011

• Over the Last 2 decades, VSL has built a strong portfolio of several G2C services.

• VSL has been handling several stand alone government projects in e-governance space.

• Have created the backend for assimilating and processing data related to citizens, and government to citizen interactions.

Strong portfolio of G2C services

• Over 22 years of E-Governance Focus - Created Last Mile Infrastructure & Connectivity to deliver Mission Mode projects (MMPs) at the Grass root level.

• Overcome On – Ground Complexities in Rural Regions – Flexible Timings, Power & Connectivity Issues, Manpower Training

• Expertise – Have Built strong expertise from Data digitization to Technology Management

Grass Root Level Execution Expertise

Dynamics of Rural Consumer Insight• Track record of Implementing several Government to

Citizen services till the Gram Panchayat Level.• Gathering & Understanding the Rural Consumer

behavior since being the part of their Eco-system for over 22 years.

• Offering citizens an end to end solution by integrating a front end that was connected to the government systems.Vakrangee Softwares Limited 17

Evolution & Transformation – Financial Inclusion Project

Bank Branch Outsourcing:

Bank Branch Outsourcing: As the “Brick & Mortar” model of banking is not sustainable in rural regions, under the “Financial Inclusion” initiative –

• RBI set the guidelines allowing banks to appoint common BCs to reach unbanked regions in India.

• Government has decided to transfer the entire scheme benefit scheme worth more than 3 Trillion per annum through bank account only.

• Direct Benefit Transfer is a big driver for Branch opening at the sub tier-III cities in India.

Exclusive Banking Common BC Branch Outlets – In 2012, RBI divided all the states into 20 different Clusters and allotted Exclusive BC Based Banking Branches for a period of 5 + 2 years .

Government has permitted all the BC Banking Branches to also offer G2C as well as B2C services at their Outlets.

Resulting into Exclusive CSC Outlets offering Banking, G2C as well as B2C services.

Vakrangee Softwares Limited 18

VSL – Allotment of Financial Inclusion Project

Allotment of Exclusive BC Based Banking License

• VSL has secured an exclusive mandate for 5 + 2 years to setup & manage 50,000 bank branches (Ultra Small Branches) in the states of Maharashtra, Rajasthan, and Delhi.

• RBI permits 80:20 Rural : Urban ratio for opening the bank branches.

o Rural – 40,000 Branches

o Urban – 10,000 Branches

• VSL plans to open an Rural Branch at each Gram Panchayat Level in the states of Maharashtra, Rajasthan and Delhi and the rest to be opened in Urban Regions –

o Maharashtra – 27,000

o Rajasthan – 9,900

o Delhi – 1,100 Branches

Offering of G2C & B2C Services

• The 50,000 branches have also been permitted to extend the G2C and B2C services transforming them into India’s first Rural Multi-Retail Outlets

Vakrangee Softwares Limited 19

Evolution & Transformation – Phase II 2011 - Current

OFFERING A WIDE VARIETY OF SERVICES AND PRODUCTS ACROSS THE SAME TARGET CONSUMERS

AT THE GRAM PANCHAYAT LEVEL.

Portfolio of G2C services

Exclusive Banking BFSI

Services

Strategic Alliances for B2C

Services

VSL Rural Retail

Model

Natural Extension into Standalone Retail chain offering three sets of services across Government, Banking BFSI and Consumer domains – G2C, BFSI & B2C

Strong Rural Distribution Channel to deliver B2C services – FMCG, Auto, Telecom, Insurance

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Advantage India - Advantage Vakrangee

PRESENCE & REACH TILL GRAM PANCHAYAT LEVEL

Proven track record of delivering time-bound mission critical projects having large

foot-print across geographies including PDS, UIDAI, CSC, IGRS and many more.

UNPARALLELED EXECUTION CAPABILITY & STRONG BOUQUET OF SERVICES

OTHER EXCLUSIVE G2C SERVICES

EXCLUSIVE BANKING SERVICES

STRONG TECHNOLOGY

EXPERTISE

G2C Services BFSI Services B2C Services

Vakrangee Softwares Limited 21

$1million consumers700

trillion market

Vakrangee is the only Organized Retail Player in this market

The Rural Advantage - 700 million consumers,US$1 trillion market, 56% of India’s income,25% of disposable income

The Rural OpportunityIn India

An opportunity so large, one might call it a ‘movement’….

Vakrangee Softwares Limited 22

Indian Rural Market: An Untapped Opportunity

The Indian rural market has emerged as an important growth engine of the Indian economy.

The rural market (rural villages + small towns with <25,000 population) has today become the largest consumption market for FMCG and consumer durables.Rural India is ready to drive Consumption Growth

Higher Government Spending

Continuous Bumper Harvest

Rising MSPs

Rural Budget Allocation

(Rs. Billion) FY12 FY13 YoY

(%)

Bharat Nirman 580 710 22%

MGNREGS 400 400 0%

Housing (IAY) 100 152 52%

Education (SSA) 210 273 30%

Health (NRHM) 178 210 18%

Total Rural Outlay 2,661 3,171 19%

Food grains

Milk

Wheat (‘000)

Rice

Sugarcane

0 50 100 150 200 250 300

236

122

86

95

24

245

126

88

102

26

FY13

FY12

Production MT

Paddy

Sugarcane

Wheat

0 500 1000 1500

1000

139

1120

1110

145

1285

FY13

FY12

Rs. per Quintal

Note: MSP – Minimum Support Prices for farm produce

Rise in annual household income from Rs. 75,000 to Rs. 88,000 in FY2013. Rising disposable income leading to higher spending power

Vakrangee Softwares Limited 23

Indian Rural Market: An Untapped Opportunity

Indian Demographics

Urban Rural

30%

70%

44%

56%

% Population % Income

Per Capita Income per annum

Rural Income Rural Expenditure Rural Disposable Income

-

5,000

10,000

15,000

20,000

25,000

16,492

12,644

3,848

19,274

14,418

4,856

2011 2012

Rural India moving up the income pyramid

Share of Rural Wallet

2010 20200

20

40

60

80

100

5639

14

17

10

17

610

5 55 54 7

Education & Enter-tainment

Health

Clothing

Others

Transportation & Communication

Housing & Consumer Durables

Food

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0.4 0.8

12 12

4.8 6.1

41.449.9

12.988.2

Rural

Urban

Rural

Urban

Rural

Urban

1.2 2.1

2.1 3.4

43.911.2

26.379.7

7.766.3

72.5

4 29.1

57.937

79.2 13.9

43.8 6.1

Globals>1,000

Strivers 500-1,000

Seekers 200-500

Aspiers 90-200

Deprived < 90

No. of House holds (In Millions)

Year 2010 Year 2015 Year 2025Income Classes In ‘000Rs

The Changing Landscape of Rural India

FMCG• Higher rural growth of 12% vs. 7% in urban FMCG consumption in 2012.• Increasing preference for new product categories, personal care

products, packaged products etc.

Automobiles• Improving roads & rising incomes are driving personal ownership of

vehicles.• Around 50% of 2-wheeler sales are coming from rural markets.• Demand for 4-wheelers is rising in rural markets - 29% of Maruti

Suzuki’s sales and17% of Hyundai Motor’s sales came from rural markets in2012.

Telecom• 10% growth in mobile shipments to 203.4 million with rising contribution

of rural sales• 29% growth in rural subscriber base to 395 million and 28% growth in

rural teledensity to 36.4% in 2012.• Rising talk time and rising number of sale of recharge coupons.

Housing & Construction

• Aspiration for better living driving demand for pucca houses - 65.3% in 2013 vs. 63.3% in 2011.

• 64% Households reported higher spending on construction despite rising prices.

• Indira Niwas Yojana – 2.72 million of new houses constructed.

Vakrangee Softwares Limited 25

The Changing Landscape of Rural India

Media & Entertainment

• Rising number of rural TV households outpacing the urban growth.• 53% growth in rural DTH households. Out of total 42 million DTH

connections, 26 million (16 million in 2011) are from rural regions in 2012.

• 55% households with higher spend on M&E at Haat / Mela, Cinema etc.

Financial Services

• 20% growth in rural credits to 8.2 million and 18% growth in rural deposits to 14.4 million in 2012.

• 26% growth in disposable income, financial inclusion of GoI, and Direct benefit transfer scheme to further boost the savings & investment trends.

Education• 40% increase in government spending in 2013 over 2012.• Education is becoming a top priority in overall spending; 82%

households increased their spending on tuition fees in 2012.• Aspiration for English medium school, IT training, and private tutors in

villages.

Healthcare

• 16% increase in government spending on healthcare through NRHM.• 80% households increased their healthcare spending in 2012.• Increasing number of hospitals in small towns.• Healthcare market grew from USD 30 billion in 2011 to USD 35 billion in

2012.

Vakrangee Softwares Limited 26

The Rural Push: Indian Government PoliciesNational E-Governance Plan(NEGP): Make all government services accessible to common man in his locality, through common service delivery outlets, and ensure efficiency, transparency, and reliability of such services at affordable costs to realise the basic needs of the common man.

31 MISSION MODE PROJECTS UNDER NATIONAL E-GOVERNANCE PLAN

Central Mission Mode Projects

State Mission Mode Projects Integrated Mission Mode Projects

Banking Agriculture Citizen Service CentreCentral Excise & Customs Commercial Taxes e-BizIncome Tax (IT) e-District e-CourtsInsurance Employment Exchange e-ProcurementMCA21 Land Records EDI fore-Trade

National Citizen Database Municipalities National E-Governance Service Delivery Gateway

Passport, Immigration & Visa Gram Panchayats India Portal

Pensions Policee-Office Property RegistrationPosts Transport

TreasuriesHealthEducationPublic Distribution System

The Mission Mode Projects as a part of NEGP will continue to be implemented in India regardless of the changing political parties and bureaucrats.

Vakrangee Softwares Limited 27

– Rural Retail Mart

Vakrangee’s Rural Retail Mart will act as a bridge between the Rural India and Modern India by providing access to several key Banking, G2C as well as B2C services to Rural India. What is Vakrangee’s

Rural Retail Mart?

One touch point at each Gram Panchayat to deliver all services to the citizens by using cutting-edge technology and focusing on reliability, quality and serviceability.

Vakrangee Softwares Limited 28

India’s First Organised Rural Retail Mart

Technology Intensive Rural Retail Mart – One Stop Shop

B2C BFSI–Rural Bank Correspondent

G2C

Telecom - Mobile recharge DTH service - Recharge,

bill payments Education Healthcare Market Research Agriculture inputs Automobiles - Dealership

of Tata Motors & Mahindra FMCG Products White Goods

Bank A/C Opening – Savings, Current, Recurring

Transactions–Deposits, Withdrawals, Remittances

Balance Enquiry, Statement of Accounts

Direct Benefit Transfer (DBT)

Pension Disbursement Food Security related DBT Insurance - Life & Non Life,

premium payments Retail loans, ODs, Fixed

Deposits Recovery of loans BSE/NSE Trading Bolts

Enrolments-UID Card, NREGA job Card, Election Card

Land Record Digitisation, Electoral Rolls, E-Stamping

Payment of Utility Bills, Taxes, Levies

Railway Tickets, Certificates, Hall tickets

Exam Fee Payments, Online Form Filling

Election Commission, NREGS, NRHM, Bharat Nirman

PDS, School Books, Food Coupon

From Direct Cash Disbursement and recharge coupons to the poor, as well as delivering luxury items like automobiles or high end consumables to the affluent.

RURAL POOR

RURAL RICH

Services are offered across the entire income spectrum

Vakrangee Softwares Limited 29

– Franchise Model

Franchise Model

To establish the retail outlets using the Franchise Model, where - Franchisee VLE – Owner of the

rural retail mart and manager of the day-to-day operations.

Franchisor VSL – Project management, infrastructure set up, VLE training, access to new services and updating content.

Revenue Streams

Fixed

BFSI- Fixed monthly remuneration from banks (VSL – 100%)

G2C - Fixed monthly subsidies from government (VSL : VLE – 50% : 50%)

B2C - Fixed monthly rentals for OOH advertisements (VSL – 100%)

One Time Transactions – Eg. Account Opening, UID generation

On Going Transactions – Eg. BFSI – Deposit/Withdrawal, Sale of Products & Services

• Agreements signed with 31 PSU Banks including SBI & its associate banks, PNB, BoB, BoI, UBI, CBI etc

• Several B2C Alliances across categories - LIC, GIC, Vodafone, Airtel, Tata Motors, Mahindra & Mahindra and many more.

• More than 3,000 VSL branches are currently operational and running successfully.

Variable (VSL : VLE – 35% : 65%)

Number of Outlets

CURRENT: 3,200

FY 2015: 50,000

Current Operational Update:

Vakrangee Softwares Limited 30

Key Alliance Partners

Vakrangee Softwares Limited 31

Execution Through Franchise Model

Vakrangee requires only minimal additional human resources for incremental setup of retail outlets

Head Quarters

State Office

District Office 1

District Office 2

District Office N

Gram Level Office 2VLE 2

Gram Level Office 1VLE 1

Gram Level Office NVLE N

More than 3,000 Current Operational office locations

Corporate PMO

State PMO

Franchisee VLE

Vakrangee

Independent Project Management audit and

consulting by the Big four

Block Office N

District Office 1

District Office 2

Vakrangee Softwares Limited 32

Robust Technical Infrastructure

Rural Multi-Retail Outlet

Note : PTS – Pass Through Server CBS – Core Banking SolutionV-SAT – Very Small Aperture Terminal

V-SAT

FI Servers of respective

Banks

B2CPartner Systems

G2CPartner Systems

PTS

CBS of respective

Banks

Vakrangee Softwares Limited 33

The rural retail outlet to be based out of the premises of the VLE (franchisee).

Internet Connectivity : VSAT connection provides the seamless

connectivity & integration of the retail outlet with the respective banks through CBS, and B2C and G2C partner systems.

Power Supply : DG Sets to be placed at each outlet to have an un

–interrupted power supply.

Security Specifications : Defined User Policy - Authentication required for

each and every user of the server. Secured and safe transactions.

SSL Certification, licenses digital certificate: Installed for https safe and secure transaction

Security Audit - Quarterly security audit including vulnerability and penetration testing

Capex Requirement – Asset Light Model

CAPEX REQUIREMENT PER RETAIL OUTLETSr. No Item Name

1 Laptop + Charger2 Web Camera3 Printer-Scanner-Copier4 DG Set

5Furniture & Fixture (1 Table, 3 Chairs, 1 CupBoard, 1 Safe)

6 VSAT Connection7 POS Machine*

VSL will act as the project manager, while VLE will operate the retail outlet and bear all the operating costs and capex (except the POS machine).

** Vakrangee will provide the POS Machine to VLE free of cost, however it will be the owner of POS Machine.

CAPEX PER RETAIL OUTLET

Entity Amount (Rs.)

Franchisee – VLE 1,25,000Franchisor – VSL 20,000Total Capex 1,45,000 **

Asset Light Model – No Major Capex requirement

for Vakrangee

Rs. 1,45,000+ taxes

Total Capex Per Outlet

Vakrangee Softwares Limited 34

– Store Economics

VSL – FranchisorPer Retail Outlet (In Rs.)

Per Month

Year1% Gross Margin

Total Revenues1,75,00

021,00,0

0025 - 30 %

BFSI 45 - 50% 35 - 40 %

B2C 25 - 30% 12 - 15 %

G2C 10 - 15% 28 - 30 %

PMS & DMS 10 - 15% 15 - 18 %

Cost of Sales1,25,00

015,00,00

0Operating Costs 1,500 18,000

EBITDA 48,5005,82,00

0% EBITDA Margin 26.0% 26.0%

Working Capital - - -Capex (POS

Machine)20,000

Total Capital Employed

20,000

VLE – Franchisee

Per Retail Outlet (In Rs.)Per

MonthYear1

Total Revenues 1,00,00012,00,0

00BFSI 45 - 50%B2C 40 - 45%G2C 10 - 15%

Cost of Sales43,000

5,16,000

Operating Costs 1,900 22,800

EBITDA*55,000

6,60,000

% EBITDA Margin 55.0% 55.0%Working Capital – 1 month(min - Rs.10,000, max – depending on business volumes)

1,00,000

Capex1,00,00

0

Total Capital Employed2,00,0

00Payback period (months) 4

Note * – EBIDTA Calculation excludes Employee Salary Cost as Franchise to be managed by VLE & his Family.

• 1Gram Panchayat => 1 branch => servicing more than 1,500 household Families.• Both VSL and VLE will benefit from higher transaction volumes. • Economies of Scope to drive Profits of the VLE - As new services are added and Transaction

Volumes increase over a period of time with no major incremental capex & operating costs, benefiting from high operating leverage.

Vakrangee Softwares Limited 35

Operationalisation Process of Retail Outlet

Campaigning to generate awareness and invite applications by circulating leaflets at gram panchayats, banks, haats etc.

Scrutinizing the applications received

Conduct online written test & interview

Verify KYC documents of VLE & Sign Franchisee Agreement with VLE

Vakrangee On-boarding

3 MONTHS 3 MONTHS

VLE On-boarding Go Live Go Steady

Dedicated Settlement Account opening with the VLE branch

Submission of KYC documents along with account number details to Alliance Partners like Banks, Business Partners and Government etc

CIBIL and Police Verification

Branch Code generation and Device ID generation

Deployment of IT infrastructure like hardware, software and VSAT

Commissioning of non IT infrastructure like generator, furniture and fixtures

Training and Capacity Building by Vakrangee and Alliance Partners

Transaction / Enrolment testing of the IT system

Go Live Certificate

The retail outlet attains the operational stability

The retail outlet achieves a target of opening 1000 bank a/c, 10,000 E top-ups, sale of 10 micro LIC policies, and sale of 1 New India Insurance policy.

Go Steady Certificate

Vakrangee Softwares Limited 36

Sample Go Live Certificates from Banks

BANK OF MAHARASHTRA PUNJAB NATIONAL BANK

Vakrangee Softwares Limited 37

Sample Go Live Certificates from Banks

UNION BANK OF INDIA

Vakrangee Softwares Limited 38

BANK OF BARODA

Sample Go Live Certificates from Banks

MAHARASHTRA GRAMIN BANK (MGM)

Vakrangee Softwares Limited 39

STORE LEVEL ECONOMICS - VSL

(Rs.) Per Month Annual Estimate

Revenue per Store

1,40,000 16,80,000

EBIDTA per Store

40,900 4,90,800

EBIDTA Margin %

29.21% 29.21%

– Summary

UNIQUE RETAIL FORMAT

EXCLUSIVITY SCALABILITYLOW CAPITAL

INTENSITY

HIGH OPERATING LEVERAGE

Till Date-Q1 FY14 FY2014 E FY2015 E

No of Outlets 3,200 12,000 50,000

Capex Per Retail Outlet (Rs.) (VSL Share) Rs. 20,000

Till Date -Q1 FY14 FY2014 E FY2015 E

Total Capex (Rs mn.)

60 240 760

• Opex Cost – Franchisee

• Negative Working Capital

Vakrangee Softwares Limited 40

Background:

• 1,00,000 + ATMs are currently operational only in Tier-I and Tier-II urban areas.

• In February 2012, RBI allowed non-banks to setup, own and operate White Label ATMs (WLAs) which would provide ATM services to customers of all banks.

Vakrangee has been granted “In-Principle Authorisation” by RBI for setting up WLAs in India.

Revenue Streams

• Vakrangee will setup, own and operate minimum 15,000 WLAs under its own brand in 3 years across the country.

Fixed Variable

Income from OOH advertisements

Financial Transaction – Rs. 15

Non-Financial Transaction – Rs. 5

Sponsor Bank

Vakrangee WLA

Cash settlement of transactions

Ensure adequate cash supply

Redressal of failed transactions

Vakrangee Softwares Limited 41

Other Key Projects – White Label ATMs

Other Key Projects

PDS (Public Distribution

System)

Computerization of Election

Commission

IGRS(Inspector General of

Registration & Stamps)

UID (Unique Identification

Project, AADHAAR)

Implementation of Biometric Smart Card based PDS in Haryana through computerization of entire PDS scheme.

To create 6 million UID linked Smart Ration Cards.

To install & operate ~9300 Smart Card POS Terminals.

Allocated in FY12 for 5 years

Computerization of the election commission.

Generated ~100 million voters’ identification cards and managed over 100,000 citizen facilitation centers across Maharashtra, Rajasthan, Gujarat and UP

Completed collection of electoral roll data of around 95 million people across 38,475 gram panchayats in UP.

Computerisation of the process of registration of documents and recovery of stamp duty as per the Indian Stamp Act.

Computerized registration of marriages, societies, firm, non-trading companies, etc.

Operation of Nagpur zone offices on BOT basis (approx. 144 offices,160) for 5 years.

Enrolments of residents for issuance of unique identification number which will be used for delivery of all government benefit schemes.

Vakrangee is a leading enrolment agency empanelled with UIDAI on pan India basis under Tier T3F4 category.

Highest UID enrolments of more than 30 million residents till date

Vakrangee Softwares Limited 42

Summary Outlook – Next 3 Years

(Rs. Mn) FY13 A

Projects Revenu

e

% of Total

Revenues

EBITDA %

Rural/Retail 4,648  29.8% 15.00 %

UID  1,020 6.6% 37.00%

Other E-Governance Projects

 950  6.1% 39.89%

Legacy - PMS/DMS/ Others

 8,940 57.5% 27.00%

Total  15,558  100% 25.16%

FY16 (E)

Revenue% of Total Revenues

EBITDA %

67,400 90 %  20-25 %

1745 2.% 30-35 %

368 1% 19-25 %

5000 7% 18-22 %

74,513 100% 20-25 %  

• Business Model Transformation – 50,000 Rural Retail Marts to be opened in the next 3 years.

• Rural Retail segment to contribute more than 90% of the Total Revenues by FY 2016. Revenues to grow 4.8x at a CAGR of 68% from Rs.15,558 mn in FY13 to

Rs.74,513 mn in FY16E. EBIDTA to grow 5.2x at a CAGR of 73% from Rs.3815 mn in FY13 to

Rs.19991.6 mn in FY16E.Vakrangee Softwares Limited 43

Summary Outlook – Next 3 Years

Scalability with No Major Capex

Expansion from 3,200 Retail Outlets currently to 50,000 Outlets by FY 2015 e. Expansion is mainly through franchise model.

Vakrangee - Capex per Outlet – Rs. 20,000 per Outlet

Total Capex requirement over next 3 years FY14-16 – Rs.1000 mn.

Strong Operating Leverage

Economies of Scope to kick in as new services are added and Transaction Volumes increase over a period of time, with no major incremental capex & operating costs benefiting from high operating leverage.

EBIDTA Margins set to Improve to 26-27% by FY16E.

Return Ratios to Improve Significantly

No Major Capex required for Expansion and Pay Back period is less than 6 months.

ROCE to improve Significantly as Incremental ROCE is more than 100% in the Retail model.

Vakrangee Softwares Limited 44

Consolidated Financials – Profit & Loss Statement

Consolidated Financials FY2013 FY2012 % Change

Net Sales Income 15471.5 13531.8Other Operating Income 0.15 0.06Total Income from Operations 15471.65 13531.86 14.3%

Cost of Materials 11510.1 10919.8 5.4%Changes in Inventories, Stk in Trade & Finished Goods -291.8 -50.7 475.5%Employee Benefit Expense 285.5 124.7 128.9%Other Expenses 152.5 122.7 24.3%Total Expenses 11656.3 11116.5 4.9%

EBIDTA 3815.35 2415.36 58.0%EBIDTA Margin % 24.7% 17.8%

Depreciation Expense 1570.8 874.4 79.6%Finance Cost 859.6 557.9 54.1%Other Income 52.1 45.3 15.0%

Profit before Tax (PBT) 1437.05 1028.36 39.7%

Tax Expenses 393.65 319.66 23.1%% Revenue 27.4% 31.1%

Profit after Tax (PAT) 1043.4 708.7 47.2%PAT Margin % 6.7% 5.2%Earnings per Share (EPS) 2.08 1.42 46.5%

Vakrangee Softwares Limited 45

Consolidated Financials – Balance Sheet Statement

Particulars FY 2013 FY

2012

EQUITIES & LIABILITIES    

Shareholder Funds    

(A) Equity Share Capital 502.5 250.2

(D) Reserves & Surplus 4,635.7 3,918.8

Total - Shareholder Funds 5,138.2 4,169.0

Minority Interest 28.5 28.5

Non Current Liabilities    

(A) Long Term Borrowings 1,456.8 1,559.6

(B) Deferred Tax Liabilities (Net) 828.8 731.6

(C) Other Long Term Liabilities 78.4 69.9

(D) Long Term Provisions – –

Total - Non – Current Liabilities 2,364.0 2,361.1

Current Liabilities    

(A) Short term Borrowings 2,852.2 2,155.9

(B) Trade Payables 1,754.7 1,218.3

(C) Other Current Liabilities 1,281.3 1,014.4

(D) Short Term Provisions 406.9 214.6

Total – Current Liabilities 6,295.1 4,603.2GRAND TOTAL – EQUITIES & LIABILITIES 13,825.8

11,161.8

ParticularsFY

2013 FY

2012

ASSETS    

Non Current Assets    

(A) Fixed Assets 4,371.2 5,516.2

(B) Non-Current Investments 23.1 14.6

(C) Long Term Loans & Advances

242.8 330.2

(D) Other Non-Current Assets 97.9 47.2

Total - Non – Current Assets

4,735.0

5,908.2

Current Assets    

(A) Inventories 537.7 244.4

(B) Trade Receivables 6,527.4 4,454.8

(C) Cash and Bank Balances 318.8 284.1

(D) Short Term Loans and Advances

191.5 196.1

(E) Other Current Assets 1,506.9 59.0

Total – Current Assets9,082.

35,238.

4

GRAND TOTAL – ASSETS13,817

.311,146

.6Vakrangee Softwares Limited 46

THANK YOU

AMMEET SABARWALContact: +91 9819576873Email: ammeet.sabarwal@dickensonIR.com,Website: www.dickensonIR.com

ABHISHEK SHARMASr. Manager – Finance & Investor RelationsContact: 022 – 67765147, + 91 9167766763Email: abhisheks@vakrangee.inWebsite: www.vakrangeesoftwares.com

ADITYA JANIExecutive – FinanceContact: +91 9167766705Email: adityaj@vakrangee.inWebsite: www.vakrangeesoftwares.com

Vakrangee Softwares Limited 47

NILESH DALVIContact: +91 9819289131Email: nilesh.dalvi@dickensonIR.com,Website: www.dickensonIR.com

ANNEXURE

Moving Up the Value Chain

PAST

Sub-Contractor

• Rashtriya Swasthya Bima Yojna (RSBY)

• MCA 21

EVOLUTION PHASE PRESENT

Prime / Lead Player Partner (Consortium Bids)

• Haryana Public Distribution System (PDS)

• Rural Retail Mart – Plan to Open 50,000 Rural Retail Outlets

• All India UID Project - Aadhar (UID)

• National Population Register (NPR)

• Common Service Centre (CSC) in Punjab & Rajasthan

• Maharashtra IGRS

ROLE – SUB CONTRACTOR

SECTOR FOCUS – IT / E-Governance

ROLE – LEAD PLAYER

SECTOR FOCUS – Retail/BFSI/ E-Governance

VSL has over the years Transformed from being an Sub Contracted IT enabler in E-Governance Projects into a Retail House offering G2C, B2C & BFSI services and a Lead Player in E-Governance Projects.

EBIDTA: 10 – 15% EBIDTA: 20 – 25%

Vakrangee Softwares Limited 49

ATM Penetration in India: One of the Lowest

India United States United Kingdom South Africa Brazil China

3,037 2,194 2,536 2,387

1,713

10,428

81

1,738

646 596 1,207

211

Card base to ATM Ratio ATM / million population

The ATM penetration in India is currently as low as 81 ATM per million population compared to 1,738 ATM/million in USA and 211 ATM/million in China. There is huge opportunity for ATM growth through the white label model. It is expected to reach 350,000 ATMs by 2017 in India.

Vakrangee Softwares Limited 50

ATM Market Sizing

BFSI – List of Banking Services permitted at Retail Outlet

Sr. No. BC Activities1 Savings A/C Opening

2 Deposit in Savings A/C

3 Withdrawal from Savings A/C

4 Remittances - A/C to A/C

5 Remittances - Tatkal

6Account Opening at /month/BC for first 5 months

7 Recurring Desposit A/C Opening

8 Deposit in Recurring A/C

9 Withdrawal from Recurring A/C

10 Savings Bank Overdraft

11 Savings Bank Overdraft - Disbursement

12 Savings Bank Overdraft - Repayment

13 Repayment in standard assets - Term Loans

14 Repayment in standard assets - Overdraft

15 Repayment in standard assets - Cash Credit

Sr. No. BF Activities16 Savings A/C Opening

17 Recurring Deposit A/C Opening

18 Current A/C Opening

19 Fixed Deposit (TDR/STDR)

20 Retail Loans - Disbursement

21 Retail Loans - Repayment

22 Over Draft

23 Kisan Credit Card - Disbursement

24 Kisan Credit Card - Repayment

25 Gramin Credit Card - Disbursement

26 Gramin Credit Card - Repayment

27 Insurance

28 Micro Pension

29 Self Help Group Management

30 Joint Liability Group Management

31Recovery in NPA Accounts - Substandard

32 Recovery in NPA Accounts - Doubtful

33Recovery in Loss & Written Off Accounts

Vakrangee Softwares Limited 51

List of Empaneled Banks – Agreements Signed

52

Sr. No.

Name of the Bank

1 Allahabad Bank2 Andhra Bank3 Bank of Baroda4 Bank of India5 Bank of Maharashtra6 Baroda Rajasthan Gramin Bank7 Canara Bank8 Central Bank of India9 Corporation Bank

10 Dena Bank11 Hadoti Kshetiya Gramin bank12 IDBI bank13 Indian Bank 14 Indian Overseas Bank15 Maharashtra Gramin Bank16 Jaipur The Gramin Bank

17Marwar Ganganagar Bikaner Gramin Bank

18 Oriental Bank of Commerce

Sr. No.

Name of the Bank

19 Punjab & Sind Bank

20 Punjab National Bank

21 Rajasthan Gramin Bank

22 State Bank of Hyderabad

23 State Bank of Bikaner & Jaipur

24 State Bank of India

25 Syndicate Bank

26 UCO Bank

27 Union Bank of India

28 United Bank of India

29 Vijaya Bank

30 Vidarbha Kshetriya Gramin Bank

31 Wainganga Krishna Gramin Bank

Vakrangee Softwares Limited

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