Firstsource Solutions Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript Firstsource Solutions Ltd filed with BSE on 12 May 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
Firstsource reported Q4FY26 revenue of INR25.8 billion, up 19.5% year-on-year, with EBIT margin at 12.2%, marking the sixth straight quarter of sequential margin expansion. For the full year, revenue crossed the billion-dollar mark at INR95.6 billion, up 19.7% in rupee terms, with EBIT margin at 11.7%, within the previously guided range. Management attributed growth to large deal wins, strategic client additions, and demand for AI-enabled transformation offerings across its Banking and Financial Services, Healthcare, CMT, and diverse verticals.
Numbers mentioned
Revenue: INR25.8 billion (Q4FY26)
p. 3
“Our revenue grew by 19.5% YoY and came in at INR25.8 billion.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
Revenue (USD): $283 million (Q4FY26)
p. 3
“In US dollar terms, the growth was 13.2% YoY and 3.2% QoQ to $283 million.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
EBIT margin: 12.2% (Q4FY26)
p. 3
“EBIT margin for the quarter was 12.2%, up 100 basis points and 30 basis points on a year-on-year and quarter-on-quarter respectively.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
Net profit: INR2.1 billion (Q4FY26)
p. 3
“Our net profit was INR2.1 billion and the diluted EPS for the quarter was INR2.91.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
Revenue: INR95.6 billion (FY26)
p. 3
“For the full year, our revenues came in at INR95.6 billion, which grew by 19.7% in rupee terms and 14.6% in dollar terms.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
EBIT margin: 11.7% (FY26)
p. 3
“Our EBIT margin for FY26 was 11.7%, within our guided range of 11.5% to 12%.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
PAT: INR6.7 billion (FY26)
p. 3
“Our PAT for FY26 stood at INR6.7 billion, a growth of 13.5% over last year on a reported basis.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
Large deals won: 17 (FY26)
p. 3
“Overall, we won 17 large deals in FY26.”
Ritesh Idnani, page 3 of the filed PDF · View the filing
BFS vertical growth: 9% YoY, 5% QoQ (Q4FY26)
p. 4
“In Q4FY26, our BFS vertical grew 9% YoY and 5% sequentially in constant currency terms.”
Ritesh Idnani, page 4 of the filed PDF · View the filing
Healthcare vertical growth: 16% YoY, 10% QoQ (Q4FY26)
p. 5
“In Healthcare, revenues grew 16% YoY and 10% sequentially in constant currency terms.”
Ritesh Idnani, page 5 of the filed PDF · View the filing
CMT vertical growth: 3% YoY, -4% QoQ (Q4FY26)
p. 5
“revenues grew 3% YoY but degrew 4% on a QoQ basis.”
Ritesh Idnani, page 5 of the filed PDF · View the filing
Diverse portfolio growth: 23% YoY, -8% QoQ (Q4FY26)
p. 5
“Lastly, coming to our diverse portfolio that grew 23% YoY but degrew 8% quarter-on-quarter in constant currency terms.”
Ritesh Idnani, page 5 of the filed PDF · View the filing
North America growth: 4% QoQ, 14% YoY (Q4FY26)
p. 5
“From a geography standpoint, North America delivered 4% sequential growth and 14% YoY growth in constant currency terms.”
Ritesh Idnani, page 5 of the filed PDF · View the filing
Europe growth: 4% YoY, flat QoQ (Q4FY26)
p. 6
“Europe grew 4% YoY and flat QoQ in constant currency terms.”
Ritesh Idnani, page 6 of the filed PDF · View the filing
Headcount: 36,205 (FY26)
p. 6
“We closed FY26 with a headcount of 36,205 Firstsourcers, a net increase of 1,554 employees over last year.”
Ritesh Idnani, page 6 of the filed PDF · View the filing
Attrition: 29.7% (FY26)
p. 6
“Attrition improved to 29.7%, down almost 6 percentage points over the last eight quarters, a clear signal of rising workforce stability.”
Ritesh Idnani, page 6 of the filed PDF · View the filing
Operating profit: INR3.1 billion (Q4FY26)
p. 7
“We reported operating profit of INR3.1 billion in Q4FY26, up 29.8% over Q4FY25, and translates to EBIT margin of 12.2%, up 30 bps sequentially.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Profit after tax: INR2.1 billion / 7.9% of revenue (Q4FY26)
p. 7
“Profit after tax came in at INR 2.1 billion or 7.9% of the revenue for the quarter.”
Dinesh Jain, page 7 of the filed PDF · View the filing
DSO: 66 days (Q4FY26)
p. 7
“DSO stood at 66 days in Q4 versus 67 days in Q3.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Normalized PAT: INR7.6 billion (FY26)
p. 7
“Normalized profit after tax for FY26 stood at INR7.6 billion, which translates to year-on-year growth of 27%, adjusted for exceptional items.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Effective tax rate: 20.6% (FY26)
p. 7
“The tax rate was 21.2% for Q4 and for FY26 the effective tax rate was 20.6%, within the previously guided range of 19% to 21%.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Cash balance including investments: INR3.1 billion (Q4FY26)
p. 7
“Our cash balance including investment stood at INR3.1 billion at the end of the Q4 FY26.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Net debt: INR16.3 billion (as of 31st March 2026)
p. 7
“Our net debt stood at INR16.3 billion as of 31st March 2026 versus the INR13.2 billion as of 31st March 2025.”
Dinesh Jain, page 7 of the filed PDF · View the filing
ROCE: 17.7% (FY26)
p. 7
“ROCE for the FY26 is 17.7% versus the 15.6% for FY25.”
Dinesh Jain, page 7 of the filed PDF · View the filing
OCF to EBITDA: 78% (FY26)
p. 16
“Our OCF to EBITDA this year is 78% and our free cash flow to the PAT is 160%.”
Ritesh Idnani, page 16 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Constant currency revenue growth — 10% to 13% · FY27
stated firmly by Ritesh Idnani
p. 9
“Against that backdrop on revenue we are guiding to constant currency growth for FY27 to be in the 10% to 13% range, and we are guiding for EBIT margin band of 12.25% to 12.75% for FY27.”
Ritesh Idnani, page 9 of the filed PDF · View the filing
EBIT margin — 12.25% to 12.75% · FY27
stated firmly by Ritesh Idnani
p. 9
“we are guiding for EBIT margin band of 12.25% to 12.75% for FY27”
Ritesh Idnani, page 9 of the filed PDF · View the filing
EBIT margin — 14% to 15% · next couple of years
stated as an aspiration by Ritesh Idnani
p. 16
“we remain laser-focused on taking our EBIT margin to 14% to 15% band in the next couple of years.”
Ritesh Idnani, page 16 of the filed PDF · View the filing
Effective tax rate — 20% to 22% · FY27
stated firmly by Dinesh Jain
p. 7
“We expect to be in the 20% to 22% range in the FY '27.”
Dinesh Jain, page 7 of the filed PDF · View the filing
Inorganic contribution to growth — 2% to 2.5% · FY27
stated conditionally by Ritesh Idnani
p. 12
“we anticipate that the contribution of the two acquisitions that we made will probably be in the range of about 2% to 2.5% going into FY27.”
Ritesh Idnani, page 12 of the filed PDF · View the filing
Revenue growth phasing — FY27
stated firmly by Ritesh Idnani
p. 14
“what we don't expect this to be back-ended, but rather almost spread out across the four quarters itself, so you should see this evenly playing out.”
Ritesh Idnani, page 14 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management said the growth reflects a combination of TAM expansion from Intelligence that operates positioning, share gains from competitors, and conversion of insourced work.
Answered by Ritesh Idnani
Asked by Vibhor Singhal: Is growth coming despite GenAI-driven cannibalization, or from weak AI implementation results, or market share gains?
p. 10
“So, I think it's a combination of all these three: the value proposition, the share shift that we can impact, and the expansion from potentially what might be an insourced portfolio to a larger share of the pie.”
Ritesh Idnani, page 10 of the filed PDF · View the filing
Management said significant scaffolding work is needed before client operations can be automated, which continues to expand the surface area for Firstsource.
Answered by Ritesh Idnani
Asked by Vibhor Singhal: Will TAM expansion from GenAI continue or accelerate?
p. 11
“All of these are the scaffolding that needs to be put in place to ensure that you can actually truly get to the end state itself.”
Ritesh Idnani, page 11 of the filed PDF · View the filing
CFO said debt buildup was due to acquisitions but cash flow remains healthy and debt should continue to decline.
Answered by Dinesh Jain
Asked by Vibhor Singhal: What is the outlook on rising net debt?
p. 11
“Last year the debt had increased by around INR700 crores, while the current year the debt increase is INR 200 crores.”
Dinesh Jain, page 11 of the filed PDF · View the filing
Management attributed the shortfall to a UK collections deal delayed by regulatory approval and a timing shift in Medicare Advantage payer programs.
Answered by Ritesh Idnani
Asked by Girish Pai: Was Q4 softer than expected and why?
p. 11
“Q4 was broadly in line with our expectations at the start of the quarter with two exceptions, and I called that out in our opening comments itself.”
Ritesh Idnani, page 11 of the filed PDF · View the filing
Management said Pastdue Credit and TeleMedik contributed about 1.5% to FY26 growth, with about 2-2.5% expected from acquisitions in FY27.
Answered by Ritesh Idnani
Asked by Girish Pai: How much of FY26 and FY27 growth is inorganic?
p. 12
“if you take FY26, Pastdue Credit and TeleMedik contributed about 1.5% to the FY26 growth. Excluding this, it's about 12.1% for FY26.”
Ritesh Idnani, page 12 of the filed PDF · View the filing
Management said efficiency savings from automation and offshoring are funding new talent investments while margin guidance remains unchanged.
Answered by Ritesh Idnani
Asked by Dipesh Mehta: How will margin guidance be balanced against investment needs for the new strategy?
p. 13
“we do believe that our ability to deliver the margin guidance that we have continues to remain unchanged while we make these investments.”
Ritesh Idnani, page 13 of the filed PDF · View the filing
Management said growth is expected to be spread evenly across quarters rather than back-ended.
Answered by Ritesh Idnani
Asked by Dipesh Mehta: How will growth be phased between H1 and H2 FY27?
p. 14
“what we don't expect this to be back-ended, but rather almost spread out across the four quarters itself, so you should see this evenly playing out.”
Ritesh Idnani, page 14 of the filed PDF · View the filing
Management declined to comment on the specific deal but said healthcare growth was broad-based across clients.
Answered by Ritesh Idnani
Asked by Shradha Agrawal: Has the BPAAS healthcare deal ramped to peak potential?
p. 15
“I think it was broad-based across several of our clients, Shraddha, in the healthcare space. Yes.”
Ritesh Idnani, page 15 of the filed PDF · View the filing
Management confirmed organic constant currency growth was close to 10%, later refined to about 9.8-9.9%.
Answered by Ritesh Idnani
Asked by Shradha Agrawal: What was organic growth excluding all acquisitions in FY26?
p. 15
“I think our organic growth was close to about 10% in constant currency terms if you exclude Ascensos, PDC, and TeleMedik. Yes.”
Ritesh Idnani, page 15 of the filed PDF · View the filing
Risks flagged
Delay in regulatory approval for UK collections deal pushed revenue to the next quarter
p. 11
“The first shortfall was on account of the implementation of a key UK collections deal that shifted to the current quarter that we are in, Q1 of FY27, because regulatory approvals took much longer than we anticipated itself.”
Ritesh Idnani, page 11 of the filed PDF · View the filing
Medicare Advantage payers suspended program ramp-ups amid tighter regulatory environment
p. 11
“In response, some of the payers suspended the ramp-up of planned programs that were already underway while they reassess the implications.”
Ritesh Idnani, page 11 of the filed PDF · View the filing
Volatility in CMT vertical from work packet timing and program transitions
p. 5
“We had a soft quarter here in Q4 largely driven by the inherent volatility in this segment, particularly the timing of work packets and program transitions in large consumer tech engagements.”
Ritesh Idnani, page 5 of the filed PDF · View the filing
Accelerated shift to offshore/nearshore delivery by European clients
p. 6
“we've seen an accelerated move towards offshore and nearshore delivery over the past few quarters with several of our clients.”
Ritesh Idnani, page 6 of the filed PDF · View the filing
Soft macro environment in Europe
p. 6
“supporting our view of a gradually improving growth trajectory in Europe despite a soft macro environment.”
Ritesh Idnani, page 6 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.