DeAr shAreholDers,
On behalf of our Board of Directors, it is my pleasure to share the annual report of
the Company for FY 2020-21, an eventful year in many ways. FY 2020-21 presented
unprecedented challenges with the COVID-19 pandemic and lockdown restrictions that
followed throughout the year. Despite these challenges, we have delivered strong financial
growth backed by robust top-line and bottom-line performance. I would like to thank our
employees and partners for their relentless efforts and dedication, as we continued to
deliver the best-in-class security solutions to our customers. Our ongoing investments in
building newer capabilities and strengthening of the leadership team, positions us well to
launch next-generation solutions and build a solid foundation for the enterprise business.
rewArDIng shAreholDers
In line with our philosophy of constantly rewarding shareholders, during the last
quarter we announced buyback of equity shares, which also fits with our robust capital
allocation policy and should be EPS accretive. Buyback is being undertaken by Quick Heal
after considering the operational and strategic cash requirements of the Company in the
medium term and for returning surplus funds to shareholders in effective and efficient
manner. The Board of Directors had also recommended a final dividend of _ 4 per equity
share with a face value of _ 10 per share for FY 2020-21, subject to shareholders’
approval in the ensuing annual general meeting. With this dividend of _ 4 per share, the
total payout ratio will be about 24% on the existing equity base.
our FInAncIAl PerForMAnce
In a challenging market environment, we have delivered a strong financial performance.
During the year, our consolidated revenue from operations increased by 16% from _ 2,861
Million in FY 2019-20 to _ 3,330 Million in FY 2020-21. The recovery is commendable
considering business was severely impacted during the initial part of the year because of
the lockdown restrictions. As the restrictions in economy were lifted, business continued
to recover sequentially during the year. The recovery in the retail segment was stronger
with 24% increase in revenue, while the enterprise segment grew by 9%. In case of
enterprise segment in the first two quarters of the year, the Government spending was
less, and the SME segment also faced some liquidity pressure. For the whole year, 82%
revenue came from retail and the balance 18% came from the enterprise segment. Our EBITDA
grew by 55% YoY to _ 1,415 Million in FY 2021 versus _ 914 Million in FY 2020, mainly on
account of top-line growth. We also reported healthy EBIDTA margins of 42.5%, an increase
of 1,054 bps over the previous year. PAT grew by 44% to _ 1,070 Million versus _ 744
Million during the previous year. The PAT margin for the year increased to 32% versus 26%
in the last year.
trenDs In cYbersecurItY MArKet
The COVID-19 pandemic has ushered India into a new era of digitisation. A rise in the
adoption of cloud platforms, digital payments, e-commerce and internet users’ count
reaching almost 700 million, has led to an increase in cyber threats, targeting
individuals and businesses of all sizes. The shortage of skilled security workforce, rapid
digital transformation, compliance requirements and evolving nature of cyber-attacks
continue to be the most pressing cybersecurity challenges. Threat actors were quick to
capitalise on this opportunity by attacking new unprotected threat surfaces when millions
of employees were forced to work from home. Attacks like ransomware, APTs, supply-chain
attacks continued to evolve and become more sophisticated, while data breaches made
headlines in India and across the world. All these factors are contributing to the
evolution of the cybersecurity industry and a new-found demand for products and solutions.
As we become more dependent on digital technologies for our personal and professional
requirements, cybersecurity will be as critical as the internet in the post Covid-19
world.
MAKIng InvestMents, buIlDIng cAPAbIlItIes
During the year, we continued to build resilience and increase our competitive
advantages in the marketplace by making right investments to build capabilities and invest
in people, processes and technologies. Our enterprise arm ‘Seqrite’ has recently
introduced ‘Seqrite Hawkk’, a premium suite of next-generation cybersecurity
solutions aimed at empowering enterprises to secure their digital transformation journey.
In the first phase, Seqrite Hawkk will offer ‘Seqrite HawkkEye’ a cloud-based
centralised security management platform that will empower enterprises to manage multiple
security products from a single console. We will continue to invest and add more products
under the Hawkk umbrella that will also mark the Seqrite brand’s foray into endpoint
detection and response (EDR), zero trust, data privacy and cloud-based network security
products. For our retail business, we revamped our existing portfolio by launching new
products backed by privacy, protection and performance. The new suite has been designed to
safeguard consumer devices while securing personal data and protecting digital identities.
It is equipped with industry leading features such as Anti-Ransomware, Safe Banking,
Anti-Tracker, Parental Control and Webcam Protection among others.
On the M&A side, we have made an additional investment of USD 2 Million in L7
Defense, an Israel-based cybersecurity start-up after making an initial investment of USD
3 Lakh in FY 2019-20. Since then, L7 Defense has proven its unique capabilities in the
area of API security and next-generation web application firewall, which gives us
rationale to further increase our investment in this. This investment reiterates Quick
Heal’s commitment to invest in disruptive technologies that will shape the future of
cybersecurity while supporting innovative startups.
covID-19 relIeF through csr InItIAtIves
COVID-19 is raging across India with a devastating impact. Isolation. Quarantine.
Social Distancing. Masks. Lockdown. These are the words that we had to hear and had to
work with during the COVID-19 pandemic. On the positive side, the pandemic also meant
responsibility, togetherness, adaptation, and opportunity. When our healthcare systems and
frontline workers are facing extreme challenges,
Quick Heal Foundation came up with admirable ideas to achieve its mission and
positively impact the community, while protecting them. As a part of our commitment to
rise to the occasion when the nation needed it the most, Quick Heal Foundation undertook
the following COVID-19 relief initiatives:
Distributed free immunity booster medicines to frontline workers
Organised health camps and assisted in the smooth functioning of COVID-19 centres
Donated medical vans to NGOs to heal tribal population
Distributed food grains to the needy during lockdown
Distributed PPE kits to NGOs
Donated to PM Cares Fund
closIng thoughts
Quick Heal has done well in a challenging year by quickly adapting and innovating among
fluid business environment throughout the year and it is well positioned for the journey
ahead. I would like to thank all our employees, channel partners, stakeholders, regulatory
agencies and investors who continue to support us in the journey. Our talented employees
have done a remarkable job of ensuring business continuity despite the multiple
disruptions resulting from the COVID-19 pandemic and lockdowns. We remain confident that
we will continue to invest and create value and opportunity for all our stakeholders,
including customers, partners, shareholders and employees. We operate in a highly exciting
and attractive market and we have the benefit of world-class people and technology all
working together to create innovative solutions. We are grateful to our Board of Directors
for their guidance and support in these uncertain times. We thank you, our dear
shareholders, for your whole-hearted and unflinching support. You have bestowed us with
the conviction, strength and courage to prepare for, and face, the future. As we march
ahead, we know we can continue to rely on your support to strengthen us in India and
across the world.
Best Wishes
Dr. Kailash Katkar
MD & CEO