### **Executive Summary** Vakrangee Limited is one of India’s largest and most strategically positioned *last-mile distribution platforms*, integrating physical retail infrastructure with digital innovation to deliver financial, social, and digital inclusion across rural, semi-urban, and urban India. The company operates through a scalable, asset-light, franchisee-driven model anchored by its **Vakrangee Kendra** network and the **BharatEasy Mobile Super App**, forming a robust *“phygital” (physical + digital)* ecosystem. With a deep footprint in Tier 4–6 areas, Vakrangee is transforming rural commerce and financial access, supported by strategic acquisitions, technological innovation, and a clear path toward pan-India district coverage. --- ### **Core Business Model & Strategic Vision** #### **Phygital O2O Ecosystem** - Vakrangee has launched the **beta version of the BharatEasy Mobile Super App** (Oct 2025), an integrated O2O (Online-to-Offline) platform combining digital services with in-person support via its 22,986+ Vakrangee Kendras. - The app offers a *single-window experience* for over 100 million products and 1,000 services, including: - Banking & Financial Services (account opening, loans, insurance, mutual funds, Demat accounts) - E-Governance (Aadhaar, PAN, GST, IT filing) - E-Commerce & Logistics (Amazon tie-up, BigHaat agritech, courier services via Delhivery) - Healthcare (teleconsultations, medicine delivery, diagnostics via DocOnline, Biogetica) - Bill Payments, Recharges, Travel, Education, Agri-products #### **NextGen Vakrangee Kendras** - As of FY2025, Vakrangee operates **22,986 franchisee-led Kendras** across **32 states, 609 districts, and 5,835 postal codes**, with: - **~83% located in Tier IV–VI regions**, giving it unparalleled rural penetration. - Standardized branding, layout, and digital integration to ensure consistent consumer experience. - The company operates three outlet models: - **Kendra with ATM** (4,882) - **Kendra without ATM** (16,890) - **Standalone ATM-only outlets** (1,214) - Aim: Achieve **100% district coverage in India by March 2026** through its **Master Franchisee model**, already active in 546 districts (as of Mar 2025). --- ### **Expansion & Strategic Initiatives (2024–2025)** #### **1. Acquisition of Vortex Engineering Pvt Ltd (Key Growth Driver)** - In **June 2024**, Vakrangee acquired **93.5% of Vortex Engineering**, a Chennai-based IIT-Madras-incubated company specializing in: - Low-power, energy-efficient (“green”) ATMs - Proprietary ATM management software **PERFO** - Full-scale ATM manufacturing (annual capacity: **>12,000 units**) - **Strategic Benefits**: - **Backward integration**: In-house ATM manufacturing reduces procurement cost and improves margins. - **Cost leadership**: Vortex ATMs offer the **lowest lifecycle cost** in the industry. - **Technology strength**: PERFO software serves the fast-growing multi-vendor ATM software market (projected to reach **$6 billion by 2026**). - **Patents & Innovation**: 9 patents in ATM and cash dispenser tech under *Make in India*. - **Order backlog**: **Over 5,000 ATMs** secured for FY2025–26, providing strong revenue visibility. #### **2. ATM & Digital Banking Network Expansion** - **White Label ATM Operator**: Vakrangee operates **6,098 ATMs**, ranking as the **3rd largest WLA operator in India** and **3rd largest in rural India**. - **Mini ATMs & Android ATMs**: Launched UPI-enabled, cardless ATMs to improve accessibility, especially for illiterate and visually impaired users (6,324 “Divyang-friendly” talking ATMs deployed). - **Digital Banking Unit (DBU) Kiosks**: Low-cost digital alternatives to physical bank branches being rolled out. - **Economics enhanced** by: - RBI’s interbank ATM fee increase to **₹19 per transaction (from May 2025)**, expected to add **₹5–10 crore to EBITDA**. - **ATM replacement cycle**: Over 100,000 outdated ATMs due for upgrade (Windows 7 to 10/11), creating annuity revenue via **Annual Maintenance Contracts (AMC)**, which grew **23.4% YoY**. #### **3. New Revenue Streams & Diversification** - **Consumer Products**: Launched private-label apparel (Oct 2024), with plans to enter additional retail categories. - **Bullion Sales**: Partnerships with **Augmont** allow sale of certified gold/silver coins and jewelry with flexible EMI plans (3/6/9 months). - **Healthcare Expansion**: Partnerships with **DocOnline, Corival, Biogetica** to offer Ayurvedic and scientific health products, teleconsultations, and home diagnostics. - **Neo-Banking Services**: P2P lending via **LenDenClub**, equity trading via **5Paisa, Choice Broking**, and insurance via **Allianz**. - **Logistics**: Strategic partnership with **Delhivery** to enable affordable last-mile delivery in rural and urban areas. --- ### **Technology & Innovation** - **AI & ML**: Used for process automation, customer service (NLP-powered chatbots), and predictive analytics. - **IoT**: Remote ATM monitoring, surveillance, and real-time cash logistics. - **Blockchain**: Secure transactions and data integrity. - **Big Data & Cloud**: AWS-powered data lake for customer behavior analysis, personalized engagement, and business intelligence. - **Cloud Migration**: BharatEasy app and VKMS fully migrated to cloud for scalability. --- ### **Financial & Operational Highlights (FY2024–25)** | Metric | Details | |-------|--------| | **Total Kendras** | 22,986 (**+6.1% YoY**) | | **ATMs Operated** | 6,098 | | **Master Franchisees Appointed** | 546 districts (as of Mar 2025) | | **Gross Transaction Value (ATMs)** | ₹97,733 million (35 million transactions) | | **ATMs Shipped by Vortex** | 1,596 units | | **ATM Order Book (FY26)** | >5,000 units | | **Vortex Revenue (FY25)** | ₹547.9 crore | | **Total Income Growth** | >20% YoY | | **Profit After Tax Growth** | >48% YoY | | **Balance Sheet** | **Debt-free**, equity increased from ₹1,621.1 Cr (FY24) to ₹2,116.7 Cr (FY25) | --- ### **Demerger & Post-Separation Strategy** - In **2023**, Vakrangee demerged into two entities: 1. **Vakrangee Ltd** – Focus: Consumer-facing B2C *Vakrangee Kendra* and *BharatEasy App* (retail-centric, asset-light). 2. **VL E-Governance & IT Solutions Ltd** – Focus: B2B e-governance, IT systems integration (capital-intensive). - **Rationale**: Unlock shareholder value, focus capital and management on high-return rural distribution platform. - The core Kendra business now operates as a **high-return, scalable, franchise-led model** with **positive free cash flow**. --- ### **Sustainability & Social Impact** - **Financial Inclusion**: Partner in PMJDY, Aadhaar enrollment, DBT, AEPS, and BC banking; opened **>1.4 million bank accounts in FY24**. - **Digital Inclusion**: Assisted e-commerce model bridges digital literacy gaps in rural India. - **Rural Employment**: Franchisee model empowers local entrepreneurship, skill development (IRDA, banking certifications). - **Environmental Commitment**: - Energy-efficient ATMs. - Pledged **Net-Zero emissions by 2035**. --- ### **Key Competitive Advantages** 1. **Unmatched Rural Reach** – Deepest physical network in Tier 4–6 India. 2. **Asset-Light, Scalable Franchise Model** – Minimal capital expenditure, rapid expansion. 3. **Backward Integration via Vortex** – Cost and technological edge in ATM operations. 4. **Integrated Phygital Platform** – BharatEasy app + physical Kendras = trust, loyalty, and reduced CAC. 5. **Diversified Revenue Streams** – Not dependent on cash transactions; growing annuity from AMC, software, and high-margin services. 6. **Strong Brand & NPS of 68%** – High customer trust in rural communities. ---