Sagility Ltd — Q1 FY27 earnings call
Summary generated by AI from the official transcript Sagility 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
Sagility reported Q1 FY27 revenue of INR 19,635 million, up 27.6% year-on-year, with organic growth of 27.3% in INR terms and 14.9% in constant currency, aided by the CareSeed acquisition completed in June 2026. Adjusted EBITDA grew 27.9% year-on-year to INR 4,716 million with a 24% margin, while adjusted PAT rose 35.1% to INR 2,697 million. Management discussed the impact of statutory minimum wage increases in Karnataka and Telangana, new deal signings of $35.3 million steady state ACV, and reiterated full-year guidance for low double-digit organic constant currency growth and 24%-25% adjusted EBITDA margin.
Numbers mentioned
Revenue: INR 19,635 million (Q1 FY27)
p. 4
“Revenue for the quarter was INR 19,635 million, or $207.8 million, representing 27.6% year-on-year growth and 15.2% growth in constant currency.”
Ramesh Gopalan, page 4 of the filed PDF · View the filing
Organic growth (constant currency): 14.9% (Q1 FY27 YoY)
p. 4
“Organic growth, excluding CareSeed acquisition, was strong at 27.3% in INR terms and 14.9% in constant currency.”
Ramesh Gopalan, page 4 of the filed PDF · View the filing
Adjusted EBITDA: INR 4,716 million (Q1 FY27)
p. 4
“Q1 adjusted EBITDA was INR 4,716 million, or $49.9 million, growing 27.9% year-on-year with a margin of 24%.”
Ramesh Gopalan, page 4 of the filed PDF · View the filing
Adjusted PAT: INR 2,697 million (Q1 FY27)
p. 4
“Adjusted PAT increased to INR 2,697 million, or $28.6 million, up 35.1% year-on-year with a margin of 13.7%.”
Ramesh Gopalan, page 4 of the filed PDF · View the filing
Steady state ACV signed: $35.3 million (Q1 FY27)
p. 5
“our commercial momentum remained healthy with $35.3 million of steady state ACV signed during the quarter across 18 existing clients and 1 new logo.”
Ramesh Gopalan, page 5 of the filed PDF · View the filing
Payer revenue contribution: 89.6% (Q1 FY27)
p. 5
“In Q1 FY 2027, payers contributed 89.6% of revenues, while providers contributed 10.4%.”
Ramesh Gopalan, page 5 of the filed PDF · View the filing
Employee strength: 47,307 (end of Q1 FY27)
p. 5
“Our employee strength was 47,307 at the end of Q1, while quarterly voluntary attrition improved significantly to 28.6% from 38.1% in Q4 FY 2026, but was marginally higher than Q1 of FY 2026.”
Ramesh Gopalan, page 5 of the filed PDF · View the filing
Active client groups: 109 (Q1 FY27)
p. 5
“following the CareSeed acquisition, we now have 109 active client groups, including 26 clients added through the transaction.”
Ramesh Gopalan, page 5 of the filed PDF · View the filing
Operating cash flow: INR 3,161 million (Q1 FY27)
p. 7
“Operating cash flow remained strong with cash generation at INR 3,161 million, translating into an EBITDA-to-cash conversion of approximately 70%.”
Srinivas Mattapalli, page 7 of the filed PDF · View the filing
DSO: 80 days (Q1 FY27)
p. 7
“Collections improved with DSO reducing to 80 days from 87 days in quarter four FY 2027, comprising of 52 days of receivables and 28 days of unbilled revenue.”
Srinivas Mattapalli, page 7 of the filed PDF · View the filing
Net debt: INR 1,110 million (Q1 FY27)
p. 8
“Our balance sheet continues to strengthen, with net debt reducing to INR 1,110 million and net debt-to-adjusted EBITDA at 0.06x.”
Srinivas Mattapalli, page 8 of the filed PDF · View the filing
Cash and cash equivalents: INR 9,674 million (end of Q1 FY27)
p. 9
“At the end of Q1 FY 2027, we had INR 9,674 million cash and cash equivalents, providing significant flexibility to invest in strategic priorities and initiatives.”
Srinivas Mattapalli, page 9 of the filed PDF · View the filing
Free cash flow: INR 2,416 million (Q1 FY27)
p. 9
“our free cash flow was INR 2,416 million after fixed asset additions of INR 745 million.”
Srinivas Mattapalli, page 9 of the filed PDF · View the filing
Minimum wage in-quarter impact: INR 70 million (Q1 FY27)
p. 8
“the in-quarter impact of the minimum wage revisions was INR 70 million, reflected above adjusted EBITDA.”
Srinivas Mattapalli, page 8 of the filed PDF · View the filing
One-time past service cost: INR 151 million (Q1 FY27)
p. 8
“a one-time past service cost item of INR 151 million related to gratuity and compensated absences arising from the statutory minimum wage revisions in Karnataka and Telangana.”
Srinivas Mattapalli, page 8 of the filed PDF · View the filing
CareSeed CY2025 revenue: $5.1 million (CY2025)
p. 5
“So you see the numbers, $5.1 million was CY 2025 revenue with a 95% recurring revenue and a 31.4% EBITDA margin.”
Ramesh Gopalan, page 5 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.
Organic revenue growth (constant currency) — low double-digit · FY 2027
stated firmly by Ramesh Gopalan
p. 9
“we remain confident in our revenue outlook and reiterate our FY 2027 guidance of low double-digit organic growth in constant currency.”
Ramesh Gopalan, page 9 of the filed PDF · View the filing
Adjusted EBITDA margin — 24% to 25% · FY 2027
stated firmly by Ramesh Gopalan
p. 10
“On margins, we are maintaining our 24% to 25% guidance despite absorbing 120 basis points incremental impact from minimum wage increases in Karnataka and Telangana.”
Ramesh Gopalan, page 10 of the filed PDF · View the filing
Adjusted EBITDA margin (upside scenario) — upper end of 24-25% or higher · FY 2027
stated conditionally by Ramesh Gopalan
p. 10
“If the eventual outcome on minimum wages results in a lower impact, we could be at the upper end of that range or even higher.”
Ramesh Gopalan, page 10 of the filed PDF · View the filing
Debt repayment — fully repay outstanding debt · FY 2027
stated firmly by Srinivas Mattapalli
p. 9
“We remain on track to fully repay our outstanding debt during FY 2027.”
Srinivas Mattapalli, page 9 of the filed PDF · View the filing
Minimum wage margin impact estimate — approximately 120 basis points · FY 2027
stated conditionally by Srinivas Mattapalli
p. 8
“Based on the current notification, we estimate an impact of approximately 120 basis points for FY 2027 on adjusted EBITDA.”
Srinivas Mattapalli, page 8 of the filed PDF · View the filing
Seasonal revenue proportion — approximately 6% of revenue · FY 2027
stated conditionally by Ramesh Gopalan
p. 16
“That's what I meant that we would still have that level of seasonality even in FY 2027, right?”
Ramesh Gopalan, page 16 of the filed PDF · View the filing
AI-led deflation impact — 200 bps and possibly higher · near future
stated as an aspiration by Ramesh Gopalan
p. 19
“even before we had 100 to 150 bps and that could increase to 200 bps over the near future and maybe even go higher in the future.”
Ramesh Gopalan, page 19 of the filed PDF · View the filing
Full-year outlook visibility — by end of Q2
stated firmly by Ramesh Gopalan
p. 10
“By the end of Q2, particularly as we enter the OE and AEP season, we expect greater visibility into the full-year outlook and will provide you a better update in our next earnings call.”
Ramesh Gopalan, page 10 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.
Less than 15-20% of employees are outside Karnataka and Telangana; the rest are concentrated in those two states.
Answered by Ramesh Gopalan
Asked by Akshat Agarwal: What proportion of employees are on statutory minimum wage in Karnataka/Telangana and what is the exposure to further hikes elsewhere?
p. 10
“Roughly from a percentage terms, I would think that less than 15% to 20% of our employees are in states outside of Karnataka and Telangana.”
Ramesh Gopalan, page 10 of the filed PDF · View the filing
The company is working on mitigation through geographic diversification and operational efficiencies, with full mitigation expected in 12-18 months.
Answered by Ramesh Gopalan
Asked by Akshat Agarwal: Is the 120bps margin impact recurring, and can it be recovered in future years?
p. 11
“the full impact in terms of mitigating that will probably take another 12 to 18 months for that to play out.”
Ramesh Gopalan, page 11 of the filed PDF · View the filing
No pricing levers were used; in fact pricing pressure is negative, and growth is broad-based across 15-20 clients each quarter.
Answered by Ramesh Gopalan
Asked by Baidik Sarkar: Can you break down the growth between new and existing clients, and was there any pricing lever used?
p. 12
“There were no pricing levers that we exercised, right? I've continued to say this in the past. Given the situation of our clients, the movement in prices is in the opposite direction, right?”
Ramesh Gopalan, page 12 of the filed PDF · View the filing
Scaling execution is not a major concern; deal timing on managed services is the bigger variable.
Answered by Ramesh Gopalan
Asked by Baidik Sarkar: Is the constraint to growth now the ability to scale delivery execution?
p. 13
“scaling up execution is the least of our concerns, right? So I'm not trying to be arrogant, but we've always executed well.”
Ramesh Gopalan, page 13 of the filed PDF · View the filing
The minimum wage impact was only partial this quarter and will be a full-quarter impact from Q2, so management wants to wait before raising guidance.
Answered by Ramesh Gopalan
Asked by Rohit Thorat: Why hasn't margin guidance been raised given no major headwinds visible?
p. 15
“The full impact of minimum wage will be felt in Q2. And like I said, 24% to 25% is a broad range. We believe that at this point, we should do better than the lower end of that range.”
Ramesh Gopalan, page 15 of the filed PDF · View the filing
Clinical, provider-side capabilities, and healthcare technology capabilities are the areas of interest for further M&A.
Answered by Ramesh Gopalan
Asked by Vamshi Krishna: How close is the company to another clinical services acquisition, and what areas are targeted?
p. 15
“Clinical is a space that, like I said, it's an area that's seeing tremendous growth and it's an area that in which we are already strong.”
Ramesh Gopalan, page 15 of the filed PDF · View the filing
No general slowdown observed; cost pressures persist but demand for value propositions continues.
Answered by Ramesh Gopalan
Asked by Rishi Jhunjhunwala: Are payers showing any spending tightening that could affect Sagility?
p. 17
“we are not seeing any general slowdown. Like I said, cost pressures continue to mount and clients continue to look for opportunities where they can take out costs, right?”
Ramesh Gopalan, page 17 of the filed PDF · View the filing
Both currency tailwinds and planned efficiency initiatives are contributing to offsetting the impact.
Answered by Ramesh Gopalan
Asked by Rishi Jhunjhunwala: How is the 120bps minimum wage impact being offset - currency or operating efficiency?
p. 17
“Currency has played a part and helped us to retain the guidance. As all of you know, that currency has depreciated quite a bit in the last three to six months.”
Ramesh Gopalan, page 17 of the filed PDF · View the filing
Deflation from onshore-to-offshore moves and automation/AI has historically been 100-150bps and could rise to 200bps or more.
Answered by Ramesh Gopalan
Asked by Seema Nayak: Where does the AI-led deflation expectation of up to 2% stand now?
p. 19
“even before we had 100 to 150 bps and that could increase to 200 bps over the near future and maybe even go higher in the future.”
Ramesh Gopalan, page 19 of the filed PDF · View the filing
The increase came primarily from the BroadPath acquisition, which brings more seasonal Medicare enrollment business, plus incremental seasonal clinical work.
Answered by Ramesh Gopalan
Asked by Sameer Pardikar: What drove the increase in seasonal revenue from about $10-15 million to $25 million per quarter?
p. 20
“Last year, the increase was two reasons. One, the addition of BroadPath. BroadPath does a lot more seasonal business because they help clients with Medicare sales and enrolment.”
Ramesh Gopalan, page 20 of the filed PDF · View the filing
Insourcing is unlikely since it would raise costs for clients; clients do want AI-driven cost takeouts but have not yet realized expected gains.
Answered by Ramesh Gopalan
Asked by Rishabh Mehra: Do clients show signs of insourcing work back due to cost pressure, and are they seeking AI-driven cost reductions?
p. 21
“insourcing it from an offshore location to their own sites is only going to increase the cost. Right? So that's unlikely to happen.”
Ramesh Gopalan, page 21 of the filed PDF · View the filing
Yes, generally that shift is margin accretive.
Answered by Ramesh Gopalan
Asked by Arvind Arora: Is the shift of work from onshore to offshore margin accretive for the company?
p. 22
“In the general sense, yes, it should.”
Ramesh Gopalan, page 22 of the filed PDF · View the filing
Risks flagged
Broader industry pressure from rising medical utilisation and costs affecting payers
p. 3
“the broader market continues to see pressure from rising utilisation, like medical costs, increasing regulatory complexity, and membership volatility.”
Ramesh Gopalan, page 3 of the filed PDF · View the filing
Ongoing pricing pressure from clients rather than price increases
p. 12
“Given the situation of our clients, the movement in prices is in the opposite direction, right?”
Ramesh Gopalan, page 12 of the filed PDF · View the filing
Full-quarter impact of minimum wage increases not yet reflected
p. 14
“We'll have a full quarter impact going forward from next quarter, right? That itself is almost more than double the impact that we had this quarter, right?”
Ramesh Gopalan, page 14 of the filed PDF · View the filing
Uncertainty in timing of managed service deal closures
p. 13
“Some of these managed service conversations take time, right? So for example, we are in active conversations on a number of such opportunities, and we've been in those conversations for three to six months, right?”
Ramesh Gopalan, page 13 of the filed PDF · View the filing
Revenue reduction from client shifting work from onshore to offshore
p. 14
“that's what is actually a reduction in revenue for the client, which is bringing that whole cohort down.”
Ramesh Gopalan, page 14 of the filed PDF · View the filing
Uncertainty on future minimum wage notification changes
p. 8
“These estimates are based on the minimum wages notification currently in effect, and any revisions to the same could result in a change to the estimated impact.”
Srinivas Mattapalli, page 8 of the filed PDF · View the filing
Limited measurable gains from piecemeal AI adoption among payers
p. 6
“70% of them claim to have adopted AI, but only 10% of them reported measurable improvement.”
Ramesh Gopalan, 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.