ZENSARTECH Q3 FY26 earnings call.
A source-linked concall view: reported numbers, management language, guidance, commitments and risks that should carry forward.
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Revenue
₹1,431 Cr
verified against source
Revenue YoY
7.9%
reported change
EBITDA
Pending
latest reported figure
Source
screener in
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Zensar delivered Q3 FY26 revenue of $160.5M (₹1,355 crore, +7.9% YoY in INR) with EBITDA margin expanding 200bps sequentially to 17.4%, driven by offshore mix shift (+1.4%), forex tailwinds (+0.7%), improved leave utilization (+1%), and operational efficiencies (+0.7%). PAT grew 18.2% YoY in USD and 24.1% in INR terms. BFSI led growth at +12.2% YoY while TMT declined 11.6% and remains the persistent headwind—now less than 10% of revenue. Volume grew 3.1% offshore with 9.5% attrition (fourth consecutive quarter below 10%). Management maintained mid-teens EBITDA guidance while committing to invest gains in AI and sales capabilities. Order book of $180.2M (1.12x book-to-bill) and cash position of $322.4M provide balance sheet strength. The CEO emphasized profit growth over revenue growth while acknowledging the need for sustainable topline acceleration. Key risk: TMT sector headwinds may persist, and HLS faces vendor consolidation impacts.
Colored figures show movement against the previous available record.
Guidance to track
- Management retains mid-teens EBITDA margin guidance while reinvesting margin gains into AI capability building and sales expansion. Some Q3 seasonal benefits (leave utilization, operational efficiencies) may reverse in Q4.
- CEO committed to delivering double-digit profit growth going forward, having delivered 18.2% YoY PAT growth in USD terms for Q3. Focus remains on EPS growth and shareholder value over revenue acceleration.
- Management indicated offshore volume growth of 3.1% is sustainable and should translate into revenue growth with higher working days in coming quarters, particularly if volume momentum continues.
- Company is actively evaluating inorganic opportunities but with strict discipline—seeking strategic acquisitions that enhance long-term shareholder value rather than merely buying revenues. Cash position of $322.4M provides war chest.
Risks flagged
- TMT vertical declined 11.6% YoY and has been negative for ~11-12 quarters. Management sees no near-term improvement as clients shift spend to AI capex/hardware and insourcing. Even 30% client discounts observed. CEO asked team to 'look beyond TMT' as it now represents <10% of revenue.
- HCL vertical faced headwinds from vendor consolidation in 1-2 accounts. CEO described it as 'wrong side of consolidation' with 2-3 million impact. Some impact expected in Q4 though manageable at company level given vertical size of ~$60-70M.
- Analyst (Nikl from Nomura) questioned management on 1.3% CC growth being below industry growth, given guidance to move from 'bottom quadrant to top quadrant' in growth. CEO deflected by emphasizing profit growth (18.2% YoY) and challenged analysts to find peers with similar profit growth, without providing specific revenue growth roadmap.
- CFO acknowledged Q3 margin expansion included 1% leave utilization benefit and some operational efficiencies that may not sustain into Q4. ESOP costs (0.9% impact) will continue. The structural offshore mix shift (1.4%) is the key durable component.
Key quotes
- We have been grappling with multiple problems and if we didn't fix the margin issue first then there will be no investment available to invest in the business to transform the business and that is why we took the important problems first.
- When I joined one of the things I told the team that the best is yet to come and I am very confident even today that the best is still to come. We are now in a position to really do M&A, be it investing in AI, be it launching new verticals. We have created the framework and the scaffolding in the organization.
- My job is to deliver shareholder value. Shareholder value comes from profit growth EPS growth. Our EPS growth is 24.1% year-over-year, our profit growth is 18.1% year-over-year in dollar terms. I challenge you to find any large-scale players who have delivered 18.1% profit growth year-over-year.
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