Zensar Technologies (504067) Q1 26/27 earnings summary

Executive summary

• Q1 FY27 revenue reached $159.5 million (₹15,083 million), up 1.1% sequentially and 8.9% YoY in INR terms, with BFSI driving growth and AI transformation a strategic focus.

• PAT margin was 12.2%, down 220 basis points sequentially, with net profit at ₹1,838 million.

• Order book stood at $149.2 million, up 62.9% QoQ, and cash balance was $317.5 million.

• Attrition rate improved to 9.6% for the sixth consecutive quarter.

• Recognized as India's #1 IT Services company to work for in 2026.

Financial highlights

• EBITDA margin contracted by 150 basis points sequentially to 14.6% due to pre-staffing, transition costs, and increased travel, visa, and training expenses.

• Diluted EPS was INR 8 per share, up 0.9% YoY; basic EPS was ₹8.11.

• Top 5 clients contributed 24.7% of revenue, top 10 clients 38.9%, and top 20 clients 56.6%.

• Total assets as of June 30, 2026, were ₹61,839 million.

• OCF to EBITDA conversion above 70%; DSO at 75 days.

Outlook and guidance

• Full revenue impact from the $210 million mega BFSI deal expected in Q3 and Q4, with continued ramp-up in Q2.

• Margins expected to remain at Q1 levels for Q2 and Q3 due to ongoing investments in SG&A, AI, and large deal ramp-up.

• Q2 anticipated to be better than Q1, with growth momentum expected to continue.

• No further impact from Labour Code changes is expected.

• Management emphasizes expanding enterprise AI adoption and cloud modernization.