Redington Limited (NSE: REDINGTON; BSE: 532805), a leading Indian integrated technology solutions provider, has announced a significant move in the cybersecurity sector. The company has entered into a new distribution agreement with CrowdStrike, a global cybersecurity leader, aimed at accelerating cybersecurity transformation across India.

Partnership Highlights

• Redington will distribute CrowdStrike's AI-native Falcon® platform to customers and partners across India.
• The agreement is set to strengthen Redington's channel reach and expand CrowdStrike's regional channel ecosystem.
• The partnership will enable Redington's partner base to drive vendor consolidation and prevent breaches with CrowdStrike's leading cybersecurity platform.

Strategic Implications

This collaboration comes at a time when the demand for cutting-edge cybersecurity solutions is on the rise due to increasing cyber vulnerabilities. The CrowdStrike Falcon platform is designed to enable customers and businesses to enhance their security posture and defend against advanced threats.

Sridhar S, head of the software solutions group (SSG) at Redington Limited, stated, "Our partnership with CrowdStrike delivers on Redington's objective of providing best-in-class technology and strategic value to businesses across India. Customer demand for cutting-edge cybersecurity solutions continues to accelerate, with the CrowdStrike Falcon platform providing exactly what organizations need to navigate today's evolving threat landscape."

Redington's Role and Reach

Redington plans to leverage its extensive channel network to drive growth in tier one, two, and three markets across India through various strategic go-to-market initiatives. These include:

• Field and inside sales
• Demand generation
• Amplification on Redington's digital e-commerce platform

Additionally, Redington will provide dedicated pre-sales and post-sales technical support to ensure smooth deployment of the Falcon platform for customers and partners.

CrowdStrike's Perspective

Jon Fox, vice president of channels and alliances for CrowdStrike Asia Pacific and Japan, expressed enthusiasm about the partnership, saying, "Expanding our channel reach with Redington strengthens our partner-first strategy and will accelerate adoption of the Falcon platform – cybersecurity's platform of choice – across India."

About the Companies

Redington Limited is a Fortune India 500 company with a presence in over 40 markets, 450+ brand associations, and 70,000+ channel partners. The company specializes in empowering businesses in their digital transformation journeys by addressing technology friction.

CrowdStrike (NASDAQ: CRWD) is known for its advanced cloud-native platform, the CrowdStrike Falcon®, which leverages AI and real-time threat intelligence to provide hyper-accurate detections, automated protection, and elite threat hunting capabilities.

This strategic partnership between Redington and CrowdStrike is poised to make a significant impact on the cybersecurity landscape in India, offering businesses enhanced protection against evolving cyber threats.

Redington Limited , a leading technology products distributor, reported strong financial results for the first quarter, with revenues growing 22% year-on-year. However, the company faced significant challenges in its Turkish subsidiary, Arena.

Financial Highlights

• Revenue grew by 22% year-on-year
• Profit increased by 12% year-on-year
• Excluding Arena (Turkey subsidiary), revenue grew 24% and profits increased 15%
• India showed robust performance with 24% growth
• UAE and Saudi Arabia posted 35% and 32% growth respectively
• The Mobility Solutions Group led with 44% growth
• Cloud Solutions continued momentum with 41% growth

Margin Pressure and Turkish Subsidiary Challenges

Despite the strong top-line growth, Redington faced some headwinds:

• Gross margins declined by 60 basis points to 5.10% due to large deals in the Technology Solutions Group, market pressures, and Arena-related issues
• The company's Turkish subsidiary, Arena, took $8.00 million in provisions due to customers filing for concordat (debt restructuring)
• Arena's performance was impacted by the challenging economic situation in Turkey

Working Capital and Future Outlook

• Working capital improved to 37 days from 39 days in the previous year
• Management maintains confidence in achieving operating profit targets of 2.30-2.50% and PAT above 1.30% for the full year
• The company is reviewing strategic options for the Turkey business

Business Segment Performance

• The Technology Solutions Group (TSG) performed well on top line with 21% growth, although margins were under pressure
• Software businesses in security solutions, infrastructure software, and application software continued their growth momentum
• The Endpoint Solutions Group with the PC business was steady at 3% growth

V.S. Hariharan, Managing Director and Group CEO, commented on the results: "This has been our best Q1 so far from a top line perspective with strong growth in both top and bottom line compared to the quarter 1 of last year. Outside of the challenges with Arena, our subsidiary, the profit performance has been good."

The company remains optimistic about future growth trends in Cloud AI and digital transformation. Redington is also focusing on enhancing its core hardware business while creating additional value in software solutions and subscription models.

S.V. Krishnan, Chief Financial Officer, addressed the margin pressure, stating, "The gross margin has been below expectations, and it's a combination of the mix shifting towards mobility for this quarter, the big deals in TSG and also market pressures on the TSG run rate business."

Redington is closely monitoring the situation in Turkey and taking proactive steps to manage the business cautiously by tightening working capital, managing overdue credit limits, and reducing Turkish lira exposure.

Despite the challenges, Redington remains committed to its growth strategy and is confident in its ability to navigate the evolving market dynamics in the technology distribution sector.