This article first appeared on GuruFocus .
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Revenue Growth (Constant Currency):0.3% quarter-on-quarter.
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Revenue Growth (Rupee Terms):2.3% sequentially; 7.4% year-on-year.
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EBITDA Margin:16.1% for the quarter.
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EBITDA:INR 222 crores, up 40.3% year-on-year.
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Total Contract Value (TCV) Signings:$168.7 million, up 20% year-on-year.
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Effective Tax Rate (ETR):29.4% for Q1 FY27.
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Basic EPS (Non-Annualized):INR 5.72 per share.
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Cash Equivalents:INR 2,878.6 crores, up 9% quarter-on-quarter and 26% year-on-year.
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Days Sales Outstanding (DSO):Improved to 45 days.
Release Date: July 28, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Birlasoft Ltd ( BOM:532400 ) reported a revenue growth of 0.3% in constant currency quarter-on-quarter and 7.4% year-on-year in rupee terms.
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The company achieved an EBITDA margin of 16.1%, indicating a return to a sustainable range.
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Strong cash collections led to an increase in cash balances, with cash equivalents rising by 9% quarter-on-quarter and 26% year-on-year.
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Birlasoft Ltd ( BOM:532400 ) secured significant AI-led engagements, including a strategic partnership with a leading US financial services player and a multi-year deal in Europe for AI-led transformation.
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The company is investing heavily in expanding its sales team and enhancing its AI capabilities, which is expected to drive future growth.
Negative Points
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Revenue growth in dollar terms was flat, indicating challenges in maintaining momentum.
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The manufacturing and energy, utilities, and resources (ENU) verticals showed softness, impacting overall revenue performance.
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There is significant pricing pressure due to AI-driven productivity gains, affecting revenue conversion from deal wins.
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The company faces fierce competition in AI-led deals, which could impact its ability to secure new contracts.
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Despite efforts to expand the sales team, the number of active accounts has decreased, reflecting challenges in client acquisition and retention.
Q & A Highlights
Q: How confident is Birlasoft in sustaining revenue growth, and what are the demand trends across different verticals? A: Angan Guha, CEO, expressed confidence in sustaining growth momentum, noting strong performance in financial services and life sciences sectors. However, manufacturing and energy & utilities (ENU) sectors are expected to face continued challenges. The company is investing to turn around these sectors, with expectations of improvement in the coming quarters.
Q: What is the outlook on EBITDA margins, and how will wage hikes impact them? A: CFO Chandrasekar Thyagarajan stated that the company aims to maintain EBITDA margins above 15%. While the first quarter saw a margin of 16.1%, upcoming wage hikes might slightly dilute margins in the short term. However, productivity improvements are expected to offset this impact.
Q: Can you provide insights into the nature and tenure of recent deal wins? A: CEO Angan Guha highlighted that recent deals are long-term, typically ranging from 18 to 24 months, with a significant AI component. The company has seen a 20% year-on-year growth in total contract value (TCV) signings, indicating strong deal momentum.
Q: How is Birlasoft addressing competition in AI-led deals? A: Angan Guha acknowledged that AI-led deals are fiercely contested, but Birlasoft is winning its fair share. The company is leveraging its AI capabilities to differentiate itself and secure strategic partnerships.
Q: What are Birlasoft's plans for capital allocation, given its significant cash reserves? A: CFO Chandrasekar Thyagarajan mentioned that the company is focused on rewarding shareholders and exploring strategic inorganic growth opportunities. Any acquisitions will be capability-based, aligning with Birlasoft's strategic focus areas.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
