Financial Performance Highlights

Q2 FY27 Performance:

  • Revenue: ₹170.2 crores (22.4% YoY growth, 13.9% sequential growth)
  • Total Income: ₹171.2 crores
  • EBITDA: ₹26.6 crores (33.7% YoY growth)
  • EBITDA Margin: 15.6% (all-time high)
  • PAT: ₹16.8 crores (41.2% YoY growth)

Constant Currency Growth:

  • YoY: 17.7%
  • QoQ: 13.5%

Operational Highlights

Customer Metrics:

  • Increased number of $1 million+ annual billing customers from 16 to 18
  • 70+ total customers across three verticals: Industrial, Transportation & Mobility, Healthcare & Life Sciences

Major Contract Renewal:

  • Renewed 3-year digital engineering engagement with global construction and mining equipment leader
  • Contract value: Approximately ₹44.5 crores
  • 70% increase compared to previous term
  • Entire contract awarded (previously dealt with 6-monthly/annual deals)

Capacity Expansion & Investments

Design Centers:

  • Four delivery centers in India: Pune, Chennai, Bangalore, Hyderabad
  • Recently opened fourth design center in Pune (expected full capacity by November/December 2026)
  • Signed lease to add more seats in Pune

AI Lab Development:

  • Chennai AI lab under development
  • Expected operational by Q4 FY27 or early 2027
  • Will serve as training facility and customer demonstration center

Hiring & Workforce

H1 FY27 Hiring:

  • Net addition of 430+ employees
  • No fresher hiring - exclusively lateral hiring from manufacturing shop floors
  • 90+ recruiters on payroll in talent acquisition group

Future Hiring Plans:

  • Q3: Prioritizing subject matter experts for 2027-2028
  • Q4: Anticipating addition of "few hundred" net employees
  • Total workforce: 3,000+ employees

Revised Guidance

FY27 Outlook (Upgraded):

  • Revenue Growth: 15% to 18%
  • EBITDA Margin: 13.8% to 14.3%

Special Items

R&D Credit:

  • Amount: ₹2.9 crores (approximately)
  • Period: FY26 (12-month period)
  • Nature: U.K. government R&D subsidy available to engineering companies
  • Accounting: Net against employee expenses already incurred
  • Process: Annual claim with project evaluation

Operational Metrics

Revenue Productivity:

  • Current: Approximately ₹22-24 lakhs per employee
  • Aspiration: ₹35-40 lakhs per employee (industry platinum standard)

DSO (Days Sales Outstanding):

  • Current: 80 days (increased due to rapid growth and approval delays)
  • Target: 65-70 days
  • Expected normalization in next 2 quarters

Depreciation Increase:

  • 27% increase due to:
  • Office acquisition in Worli, Mumbai
  • Hardware purchases for new design centers and 400+ employee addition

Business Segments

Vertical Performance:

  • Industrial: Most dominant and mature vertical (approximately 80% of revenue)
  • Transportation & Mobility: Showing turnaround with good YoY growth
  • Sub-verticals: Automotive and Rail Transportation
  • Rail transportation growing meaningfully
  • Healthcare & Life Sciences: Small base (~₹5 crores/quarter) but winning large customers

Geographic Focus

Markets:

  • Exclusive focus on U.S. and Europe customers
  • No India customers
  • North America: Primary revenue driver with substantial jump in revenue

Growth Drivers & Opportunities

Key Growth Areas:

  • Digital engineering engagements
  • AI-led transformation programs
  • Data center infrastructure engineering
  • Power management systems
  • Cooling systems
  • Intelligent industrial platforms

Customer Engagement Strategy:

  • Focus on deepening existing customer relationships
  • Target: $10 million annual revenue per customer (current base: $1 million+)
  • Participating in several large RFPs with existing customers

Risk Factors

Regulatory Impact:

  • U.S. PERM regulations affecting on-site delivery model
  • Company hiring locally in U.S. to mitigate impact
  • Revised guidance incorporates regulatory environment

AI Impact Assessment:

  • Viewed as both productivity enabler and growth opportunity
  • Embedding AI into engineering workflows and software development
  • Customers expecting productivity improvements but not reducing workload
  • Guidance includes anticipated AI impact

Investment Focus Areas

Capital Allocation:

  • Subject matter expert hiring
  • Training and development (L&D)
  • Sales and account management teams
  • Customer workshops and presentations
  • Industry seminar participation
  • Technology disruption preparedness