eClerx Services Limited Earnings Summary — Q1 FY2027
eClerx Posts Strong Q1 FY27 Revenue Growth but Experiences Margin Compression Amid Employee Benefit Hikes
Quarterly Business Intelligence
AI Quarterly Scorecard™
Computed deterministically from the last 10 reported quarters.
Quarterly Business Momentum
- Revenue has increased for 10 consecutive quarters.
- Revenue of ₹1,152 Cr is 23.3% higher year-on-year.
- Revenue has compounded at 19.9% annualised over the last 10 quarters.
- Revenue is at its highest level in 10 quarters.
- Net profit of ₹164 Cr is 16.0% above the same quarter last year.
- Profit growth is trailing revenue growth this quarter.
- Net profit has compounded at 10.8% annualised across the period.
- Operating margin stands at 23.0% in Q1 FY2027.
- Operating margin compressed by 96 bps year-on-year.
- Over the last two years operating margin has expanded by 174 bps.
- PBT margin is 19.0%.
- Expenses grew 24.9% against revenue growth of 23.3%.
- Operating profit of ₹265 Cr is 18.4% higher year-on-year.
- Operating leverage has been under pressure recently.
- 6 of the last 6 measured quarters delivered year-on-year revenue growth.
- Overall quarterly business momentum scores 73/100 (Strong) on the latest 10 quarters.
- Business momentum remains positive heading into the next quarter.
Quarterly Financials
Last 10 Reported Quarters • All figures in ₹ Crore • Margins in %
| Metric | Trend | Latest Q1 FY2027 | Q4 FY2026 | Q3 FY2026 | Q2 FY2026 | Q1 FY2026 | Q4 FY2025 | Q3 FY2025 | Q2 FY2025 | Q1 FY2025 | Q4 FY2024 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | Improving | 1,152 | 1,107 | 1,070 | 1,005 | 935 | 898 | 854 | 832 | 782 | 767 |
| Expenses | Improving | 887 | 824 | 794 | 734 | 710 | 680 | 646 | 616 | 616 | 571 |
| Operating Profit | Improving | 265 | 283 | 276 | 271 | 224 | 219 | 207 | 216 | 166 | 196 |
| Operating Margin | Stable | 23.0% | 25.6% | 25.8% | 27.0% | 24.0% | 24.3% | 24.3% | 25.9% | 21.3% | 25.5% |
| Other Income | Volatile | 18 | 30 | 30 | 27 | 11 | 32 | 21 | 13 | 21 | 23 |
| Interest | Strong Uptrend | 15 | 12 | 10 | 11 | 10 | 11 | 8 | 8 | 8 | 6 |
| Depreciation | Improving | 50 | 50 | 46 | 43 | 37 | 41 | 36 | 33 | 32 | 34 |
| Profit Before Tax | Improving | 219 | 252 | 250 | 245 | 188 | 199 | 184 | 188 | 148 | 179 |
| Tax | Stable | 54 | 62 | 58 | 62 | 47 | 46 | 47 | 48 | 36 | 50 |
| Net Profit | Improving | 164 | 189 | 192 | 183 | 142 | 152 | 137 | 140 | 112 | 131 |
| Net Margin | Stable | 14.3% | 17.1% | 17.9% | 18.2% | 15.2% | 16.9% | 16.1% | 16.9% | 14.3% | 17.0% |
Key Takeaways
- Revenue grew 23.3% YoY to ₹11,523.6 million, driven by demand in data management and analytics solutions.
- Net profit increased 16% YoY but declined 13.2% sequentially, impacted by rising operational expenses.
- Employee benefit expenses jumped 24.9% YoY to ₹7,288.5 million, reflecting recent wage hikes and increased headcount.
- Consolidated Operating Margin contracted significantly to 17.4% from 20.8% in the prior quarter, largely due to typical Q1 wage adjustments.
- Client concentration risk continues to improve, with top 10 client concentration moderating to 59% from previous levels of 63-64%.
- Diluted EPS rose to ₹17.61, benefiting from a lower share count post-buyback activities despite the sequential profit dip.
Management Guidance
Management expects growth to remain in the top quartile of its peer segment for FY2027, with an EBITDA margin target range of 24% to 28%. They anticipate that sequential growth will rebound after the softer Q1 margin period, supported by strong new deal wins (ACV) of $46 million.
Sentiment Shift
Stable
While margins faced seasonal pressure from wage hikes, the double-digit revenue and year-over-year profit growth demonstrate continued operational strength and robust demand for AI-integrated services.
Outlook
The company enters FY2027 with high conviction, focusing on 'Agentic AI' deployments and expanding its Adobe partnership. While Fashion and Luxury remain sluggish, recovery is expected in H1 FY27, complemented by steady pipelines in BFSI and High-tech verticals.
From the Annual Report (Key Quotes)
“We are building an AI-fluent organization from the inside out, training more than 3,000 employees on Agentic AI.”
“FY '26 operating revenue... reflected durable operational leverage built over several years.”
“We are not shying away in cannibalizing our own revenue... we are in here for long term.”
Official Quarterly Documents
Ask AI about this quarter
This summary is AI-generated from eClerx Services Limited's latest quarterly filing and earnings call. For informational purposes only — not investment advice.