Financial Performance Summary

Q2 FY27 Financial Highlights

  • Revenue: INR 546.6 crores, representing 11.5% year-on-year growth
  • EBITDA: INR 115.5 crores, showing 30% year-on-year growth
  • EBITDA Margin: 21.1%, expanding 301 basis points year-on-year
  • EBIT: INR 92.2 crores, growing 33.8% year-on-year
  • EBIT Margin: 16.9%, expanding 281 basis points year-on-year
  • PAT after non-controlling interest: INR 73.4 crores, up 16.1% year-on-year
  • PAT Margin: 13.2%, expanding 69 basis points year-on-year

Adjusted EBIT Calculation

The company reported adjusted EBIT of INR 99.3 crores (18.2% margin) after excluding amortization of intangible assets from the TNQTech acquisition. This non-cash accounting charge of approximately INR 7.1 crores per quarter started in Q4 FY25 and will be fully amortized by Q3 FY28.

H1 FY27 Financial Performance

  • Revenue: INR 1,060.6 crores, representing 10.7% year-on-year growth
  • EBITDA: INR 216.6 crores, showing 31.4% year-on-year growth
  • EBITDA Margin: 20.4%, expanding 322 basis points year-on-year
  • EBIT: INR 170.6 crores, growing 36.1% year-on-year
  • EBIT Margin: 16.1%, expanding 300 basis points year-on-year
  • PAT after non-controlling interest: INR 145.8 crores, up 28.3% year-on-year
  • PAT Margin: 13.4%
  • EPS: INR 24.66 per share, reflecting 28.3% year-on-year growth

Segment Performance Q2 FY27

Digital Operations

  • Revenue: INR 314.9 crores, up 15.6% year-on-year
  • EBIT Margin: 21.8%
  • Strongest growing segment driven by deeper customer engagement and operational excellence

Digital Technologies

  • Revenue: INR 166.6 crores, up 8.8% year-on-year
  • EBIT Margin: 9.5%
  • Growth driven by accelerated demand in AI-led application modernization and development
  • KAi Modernization Factory delivers up to 40% cost savings and 3x faster go-live

Digital Experiences

  • Revenue: INR 65.1 crores, up 0.8% year-on-year
  • EBIT Margin: 12.0%
  • Business remains stable with focus on broadening customer base and AI-enabled delivery

Geographical Revenue Mix

  • United States: 57% of business
  • UK and Europe: 24% of business
  • India: 12% of business
  • Rest of World: 7% of business

Client Concentration

  • Top 5 clients: 29% of revenue (improved from 26% in Q2 FY26)
  • Top 10 clients: 39% of revenue (stable)
  • Top 20 clients: 53% of revenue (improved)
  • Average contribution per client: approximately 5%

Operational Metrics

  • Billed DSO: 66 days as of September 30, 2026
  • Headcount: Approximately 14,000-15,000 employees
  • Net Cash and Investments (net of debt): INR 557 crores as of September 30, 2026 (down from INR 710.2 crores as of June 30, 2026 due to final TNQTech acquisition payment)

Strategic Updates and Business Highlights

AI and Technology Initiatives

  • Approximately 55% of opportunities are heavily AI-driven
  • Added agentic claims management to TruAI underwriting offering in insurance segment
  • Presented legacy transformation journey with Fortune 500 customer at Gartner IT Symposium
  • All services now include some component of AI

Leadership Changes

  • Dr. Rajesh Gharpure appointed as President and Chief Operating Officer to accelerate growth and scale execution

Business Strategy Shift

  • Shifted from hunting new logos (previously 15-18 clients per quarter) to mining existing accounts
  • Focus on top 50 accounts ("Focus 50") for growth
  • Added 6-7 new clients in H1 FY27 through selective hunting in ideal customer profile areas

Revenue Models

  • Time and material billing
  • Outcome-based billing
  • Fixed price billing
  • Increasing shift toward outcome-based models, particularly in Digital Operations

Guidance and Outlook

Growth Targets

  • 3-year target to achieve INR 3,000 crores revenue
  • Expected 15% CAGR with 10-12% organic growth and 3-4% inorganic growth
  • H2 FY27 expected to maintain healthy growth, potentially reaching 9-9.5% for full year

Margin Outlook

  • EBITDA margin of approximately 20% expected for FY27
  • 100-150 basis points improvement target achieved
  • Margins considered sustainable with no significant fluctuations expected

Acquisition Strategy

  • Strong balance sheet with INR 557 crores net cash available for acquisitions
  • In dialogue with a few companies but nothing matured to discuss
  • TNQTech acquisition performing extremely well

Headcount Strategy

  • Headcount expected to remain stable or show marginal increase despite revenue growth
  • Bulk of growth to be absorbed through AI tools and automation
  • Expected headcount range: 15,000-15,500

Operational Details

Wage Hike

  • Annual wage hike effective April 1, 2026 (Q1 FY27)
  • Partial wage hike implemented in October and April
  • Already factored into current financial results

R&D Investment

  • R&D investment maintained at INR 40-50 crores level
  • Booked primarily in Digital Technologies segment

Recognition

  • Founder Chairman Dr. Kanodia recognized by Indo-American Chamber of Commerce for contribution to U.S.-India business relationship