Detailed Coverage

Sagility Ltd Reports Robust Q1 FY27 Performance

Sagility Ltd's revenue reached INR 19,635 million, marking a 27.6% increase year-on-year for Q1 FY27. Adjusted EBITDA stood at INR 4,716 million, with a margin of 24%, and Adjusted Profit After Tax (PAT) was INR 2,697 million, at a 13.7% margin.

Reader Takeaway: Strong revenue growth and stable margins offset wage headwinds; CareSeed acquisition bolsters market position.

What just happened

Sagility Ltd announced its financial results for the first quarter of fiscal year 2027 (Q1 FY27). Key highlights include consolidated revenue of INR 19,635 million, up 27.6% from the same period last year. The company also reported an Adjusted EBITDA of INR 4,716 million (24% margin) and Adjusted PAT of INR 2,697 million (13.7% margin). Operating cash flow was INR 3,161 million, and Net Debt stood at INR 1,110 million at the end of the quarter.

Why this matters

These results demonstrate Sagility's ability to grow its top line significantly while maintaining profitability, even in the face of cost pressures. The acquisition of CareSeed is a strategic move to enhance its service offerings and client reach, particularly in the mid-market segment.

The backstory

The company faced a statutory minimum wage revision impact of INR 70 million and exceptional costs of INR 151 million due to past service costs related to gratuity and compensated absences. Despite these, the company managed to keep its adjusted EBITDA margin at 24%. Employee strength grew to 47,307, with voluntary attrition improving to 28.6% from 38.1% in Q4 FY26.

What changes now

Sagility has successfully integrated CareSeed, adding two platforms, 'Forecast' and 'Harvest', and 26 active client groups. CareSeed reported CY 2025 revenue of USD 5.1 million with a 31.4% EBITDA margin. Management has reiterated its double-digit organic growth guidance for FY2027 and maintained its EBITDA margin guidance of 24% to 25%, expecting to mitigate wage headwinds through operational efficiencies and favorable forex.

Risks to watch

Key risks include wage inflation, projected to impact FY2027 adjusted EBITDA by approximately 120 basis points due to minimum wage revisions in Karnataka and Telangana. The U.S. payer market faces cost pressures, limiting pricing power. The company also experiences seasonality, with stronger volumes typically in Q3 and Q4, linked to the U.S. open enrollment cycle.

Peer comparison

While specific peer data is not provided in the filing, Sagility's reported revenue growth of 27.6% and stable 24% EBITDA margin indicate competitive performance in the managed services sector, especially considering the inflationary environment.

Context metrics (time-bound)

• Revenue: INR 19,635 million (+27.6% YoY)
• Adjusted EBITDA: INR 4,716 million (24% margin)
• Adjusted PAT: INR 2,697 million (13.7% margin)
• Voluntary Attrition: 28.6% (down from 38.1% in Q4 FY26)
• CareSeed CY 2025 Revenue: USD 5.1 million (31.4% EBITDA margin)

What to track next

Investors will be watching the impact of wage inflation on margins in coming quarters, the success of cross-selling CareSeed's capabilities, and the seasonal volume increase in the latter half of the fiscal year.