Mastek Ltd — Q1 FY27 earnings call
Summary generated by AI from the official transcript Mastek Ltd filed with BSE on 28 Jul 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
Mastek reported Q1 FY27 revenue of $104.8 million, up 1.2% sequentially, with operating EBITDA margin of 15.4%, while the 12-month order backlog grew 25% year-on-year in INR terms. Management attributed Middle East margin pressure to geopolitical disruption causing increased bench cost and delayed collections, while highlighting strong order book momentum in the UK and North America, including a $25 million Salesforce Agentforce deal. Leadership also announced the appointment of Amit Gajwani as Chief Operating Officer and described ongoing AI-led demand and an internal AI-driven business transformation.
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Numbers mentioned
Revenue: $104.8 million (Q1 FY27)
p. 5
“In Q1, we reported revenue of $104.8 million, sequentially up by 1.2% and an operating EBITDA of 15.4%.”
Deepak Kedia, page 5 of the filed PDF · View the filing
Revenue (INR): INR 985 crore (Q1 FY27)
p. 5
“In rupee terms, we reported revenue of INR 985 crore, a sequential growth of 5% and a Y-on-Y growth of 7.7%.”
Deepak Kedia, page 5 of the filed PDF · View the filing
PAT: INR 105.9 crore (Q1 FY27)
p. 5
“We reported PAT of INR 105.9 crore or 10.6% of total income.”
Deepak Kedia, page 5 of the filed PDF · View the filing
12-month order backlog: $310 million (Q1 FY27)
p. 5
“We closed the quarter with a healthy 12-month backlog of $310 million, a sequential growth of 3.2% and a Y-on-Y growth of 13.3% in USD terms and 25% in INR terms.”
Deepak Kedia, page 5 of the filed PDF · View the filing
Basic EPS: INR 34.2 (Q1 FY27)
p. 5
“We reported a basic EPS of INR 34.2, up 14.8% compared to last year and a diluted EPS of INR 33.9, up 15% compared to last year.”
Deepak Kedia, page 5 of the filed PDF · View the filing
Collections from customers: $116 million (Q1 FY27)
p. 5
“During Q1FY'27, we had another good collection quarter, wherein we collected $116 million from our customers, resulting in DSO of 75 days, an increase of 2 days”
Deepak Kedia, page 5 of the filed PDF · View the filing
Variable pay paid: INR 107 crore (Q1 FY27)
p. 5
“During the quarter, we paid INR 107 crore as variable pay to our employees.”
Deepak Kedia, page 5 of the filed PDF · View the filing
Operating cash generated: INR 27 crore (Q1 FY27)
p. 5
“Despite that, we were able to generate positive operating cash of almost INR 27 crore.”
Deepak Kedia, page 5 of the filed PDF · View the filing
Data, automation and AI business growth: 9.8% sequential growth (Q1 FY27)
p. 6
“In terms of service lines, data, automation and AI business grew by 9.8% sequentially, thereby reinforcing our focus as AI transformation company.”
Deepak Kedia, page 6 of the filed PDF · View the filing
Public sector business growth: 7.9% sequential growth (Q1 FY27)
p. 6
“In terms of industry, public sector business continues to show its strength by growing 7.9% sequentially.”
Deepak Kedia, page 6 of the filed PDF · View the filing
Closing headcount: 4,897 (Q1 FY27)
p. 6
“Our closing headcount was 4,897, an addition of 167 during the quarter, out of which U.K. added 125 on the back of ramp-up of new projects.”
Deepak Kedia, page 6 of the filed PDF · View the filing
Attrition rate (LTM): 16.4% (LTM as of Q1 FY27)
p. 6
“Our last 12-month attrition rate is down by 1% from 17.4% to 16.4%.”
Deepak Kedia, page 6 of the filed PDF · View the filing
Subcon cost: 18.5% of total revenue (Q1 FY27)
p. 7
“Yes, Sushovon. So subcon cost, it is 18.5% of our total revenue in the current quarter, which is in line with what we had in Q4 as well.”
Deepak Kedia, page 7 of the filed PDF · View the filing
Tax assessment addition - transfer pricing: INR 91 crore (FY2022-23)
p. 6
“During the quarter, we received an income tax assessment for financial year 2022-23, wherein the assessing officer added an income of INR 91 crore on account of transfer pricing and INR 32.5 crore on account of domestic tax.”
Deepak Kedia, page 6 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.
ESOP cost impact — $400,000 to $500,000 per quarter · from Q2 FY27
stated firmly by Deepak Kedia
p. 7
“We are estimating an impact of $400,000 to $500,000 per quarter.”
Deepak Kedia, page 7 of the filed PDF · View the filing
North America margin — mid-teens margins at $28-30 million quarterly run rate
stated conditionally by Umang Nahata
p. 10
“So, as we start reaching close to $28 million to $30 million a quarter run rate is where we believe the North America business will start delivering healthy margins of somewhere around mid-teens.”
Umang Nahata, page 10 of the filed PDF · View the filing
North America business turnaround — growth engine · H2 FY27
stated as an aspiration by Umang Nahata
p. 13
“So, by H2 is where we believe North America should turn itself into a growth engine.”
Umang Nahata, page 13 of the filed PDF · View the filing
Healthcare US ramp-up — H2
stated conditionally by Umang Nahata
p. 8
“So that should also turn around – whether it is going to be Q2 is not necessarily firm, but especially as we get into H2, we are quite sure that our Healthcare Life Sciences business in the U.S. is also going to be ramped up.”
Umang Nahata, page 8 of the filed PDF · View the filing
UK Healthcare ramp-up — Q2 and H2
stated firmly by Umang Nahata
p. 8
“Our Healthcare business in U.K., which is our most prominent growth business, we believe will start ramping back up in the right direction from Q2 and as we get into H2.”
Umang Nahata, page 8 of the filed PDF · View the filing
Middle East business — flat
stated conditionally by Umang Nahata
p. 9
“As these projects that we have already won ramp-up, we believe that Middle East should at least stay flat and depending on how the macroeconomics works out or the geopolitical situation works out.”
Umang Nahata, page 9 of the filed PDF · View the filing
FY27 performance vs FY26 — FY27
stated firmly by Umang Nahata
p. 13
“Devang, like I just said, we believe our FY27 performance should be better than FY26.”
Umang Nahata, page 13 of the filed PDF · View the filing
Full year EBITDA margin guidance — FY27
stated as an aspiration by Deepak Kedia
p. 12
“However, for the full year basis, while we'll not be able to provide any guidance at this point in time, but we are definitely working on internal cost efficiencies to basically mitigate a significant portion of the impact.”
Deepak Kedia, page 12 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 FCA has started ramping up with more in Q2, HADES is a renewal with steady revenue, the North America deal is expected to ramp by H2FY27, and the top client decline reflects a timing gap in the NHS England healthcare project transition.
Answered by Umang Nahata
Asked by Sushovon: When will the FCA, Atlas, HADES and US deals ramp up, and why did top 5/10 client revenue decline?
p. 6
“The FCA deal has already started ramping up. And as you see the financial performance improvement in our banking and financial services in U.K., it's largely on the back of ramp-up of FCA, while we'll continue to see some more ramp-up in Q2.”
Umang Nahata, page 6 of the filed PDF · View the filing
Deepak said subcon cost was stable at 18.5% of revenue, in line with Q4, and ESOP costs of $400,000-$500,000 per quarter would begin from Q2.
Answered by Deepak Kedia
Asked by Sushovon: Is subcontractor cost increasing as a percentage of revenue, and what is the ESOP cost impact?
p. 7
“So subcon cost, it is 18.5% of our total revenue in the current quarter, which is in line with what we had in Q4 as well. So, we are not seeing any significant increase in subcon costs in Q1.”
Deepak Kedia, page 7 of the filed PDF · View the filing
Umang said the pipeline continues to improve with more large deal opportunities appearing, Middle East had a large healthcare deal close in Q1 with more in the pipe, and margins should stay flat unless the region stabilizes further.
Answered by Umang Nahata
Asked by Amit Chandra: Excluding the $25 million US deal, is the order backlog flat sequentially, and how healthy is the funnel and Middle East margin outlook?
p. 9
“We are seeing a good increase in the number of large deal pipeline items that we have. This is a change from what we had seen earlier.”
Umang Nahata, page 9 of the filed PDF · View the filing
Umang described three parallel motions: expanding AI within existing accounts via a maturity model, net new business aligned to Oracle/Salesforce/Snowflake/Databricks partnerships, and a champion-challenger approach to win competitors' accounts.
Answered by Umang Nahata
Asked by Amit Chandra: Are the AI deals coming from existing accounts or net new engagements?
p. 10
“So, the AI deals are both, Amit. As far as existing customers are concerned, there is a very active campaign that we are running across all of our installed base customers, having significant AI discussions.”
Umang Nahata, page 10 of the filed PDF · View the filing
Umang said the business is trending similarly to Q4 with continued order book execution and AI-led demand, while Deepak attributed the margin change to Middle East collection delays, provisioning, mix change and UK regulatory costs offset by cost efficiency and currency tailwinds.
Answered by Deepak Kedia
Asked by Sushovon: What changed in demand sentiment versus last quarter, and what is the EBITDA margin bridge between Q4 and Q1?
p. 12
“So, our EBITDA, as I was mentioning earlier in my narrative that we did have impact because of Middle East where certain collections got delayed and even some of the unbilled, we were not able to invoice because of unavailability of the client.”
Deepak Kedia, page 12 of the filed PDF · View the filing
Deepak said ESOP costs and planned Q2 increments will pressure margins, and while no full-year guidance was given, the company is working on internal cost efficiencies to offset the impact.
Answered by Deepak Kedia
Asked by Sushovon: What will be the steady-state EBITDA/EBIT margin given upcoming ESOP costs?
p. 12
“As you rightly pointed out, ESOP is one area where we definitely will have some impact and that will rather reduce our EBITDA for the year.”
Deepak Kedia, page 12 of the filed PDF · View the filing
Umang said UK momentum should continue, North America needs one or two more quarters before becoming a growth engine by H2, and named Middle East uncertainty and AI-led competitive pressure from incumbents as key headwinds.
Answered by Umang Nahata
Asked by Devang Bhatt: Can the Q4-to-Q1 sequential improvement continue, and what headwinds remain besides Middle East?
p. 13
“The headwinds, if you ask, Middle East definitely is in a little state of uncertainty. Like I had mentioned earlier, while we have a strong pipe, but the deal closures are uncertain given the political turmoil that the region is in.”
Umang Nahata, page 13 of the filed PDF · View the filing
Risks flagged
Middle East geopolitical instability affecting business predictability and collections
p. 4
“The Middle East business, on the other hand, continues to face some severe headwinds. As we all know, the West Asia crisis is creating a lot of unstability as well as unpredictability in the market.”
Umang Nahata, page 4 of the filed PDF · View the filing
Increased bench cost and delayed collections in Middle East impacting EBITDA
p. 5
“Middle East continues to be impacted by geopolitical situation, resulting in increased bench cost and delayed collection. This has impacted our EBITDA in Q1.”
Deepak Kedia, page 5 of the filed PDF · View the filing
UK public sector political leadership change creating uncertainty around budget and policy priorities
p. 4
“While there has been political leadership change in the country, we continue to observe the changes quite closely and understand the policy and priority changes of the new government.”
Umang Nahata, page 4 of the filed PDF · View the filing
Aggressive price competition and discounting in net new wins and renewals
p. 8
“We are definitely seeing aggressive price competition, both in terms of net new wins as well as renewals that we are going through.”
Umang Nahata, page 8 of the filed PDF · View the filing
Competitive pressure from incumbents challenging Mastek on existing accounts
p. 13
“we are also consistently trying to protect our turf on existing customers where we are getting challenged by incumbents who come and challenge us on our turf.”
Umang Nahata, page 13 of the filed PDF · View the filing
Income tax assessment addition for FY2022-23 on transfer pricing and domestic tax grounds
p. 6
“During the quarter, we received an income tax assessment for financial year 2022-23, wherein the assessing officer added an income of INR 91 crore on account of transfer pricing and INR 32.5 crore on account of domestic tax.”
Deepak Kedia, page 6 of the filed PDF · View the filing
Utilization decline due to order pushouts and Middle East situation
p. 6
“Utilization, excluding trainees, were down by 2% sequentially due to order pushouts and the situation we have in the Middle East.”
Deepak Kedia, 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.