BSE IT Technology Sector Regulatory Filings — May 18, 2026

FY26 revenue grew 18.1% YoY to ₹19,520 Mn, but Q4 missed expectations due to transient budget cuts by two large clients; guidance for FY27 high single-digit growth implies deceleration

Organic business (ex-North American real estate contract) grew 12% in USD in Q4, showing underlying momentum; SweetRush acquisition closed early Q4 and is EPS accretive from FY27

International services USD revenue flattish QoQ at $82.4M (0.6% constant currency growth), indicating muted near-term demand

EBITDA margin improved 70 bps QoQ to 20.2%, driven by operational efficiencies and mix shift

AI-led order book reached $49M for FY26 (18% of total) and pipeline stands at $280M, signaling strong future revenue potential

Domestic revenue declined 25% QoQ to ₹1,759.2 Cr, a steep drop that may indicate competitive pressure or project completions

Final dividend of ₹31 per share declared with record date May 25, 2026, maintaining consistent capital returns; AGM scheduled June 9, 2026

Annual Secretarial Compliance filed on May 18, 2026, confirming adherence to SEBI norms – reduces regulatory risk but offers no financial signals

Leadership transition (Rajsekhar Datta Roy as CEO for international business) introduces execution uncertainty but could bring fresh strategic focus

EBITDA margin guidance of 18-20% for FY27 vs 20.3% in FY26 implies compression of at least 30 bps, reflecting cost headwinds

PAT grew 3.9% QoQ to ₹130.5 Cr despite flat international revenue, indicating cost control and margin expansion

Full-year FY26 EBITDA margin of 20.3% was within guidance, demonstrating cost discipline in a challenging environment

FY27 revenue growth guidance of high single digits is a sharp deceleration from 18.1% YoY in FY26, implying potential market share loss or macro headwinds

EBITDA margin guided at 18-20% for FY27 vs 20.3% in FY26, representing a potential 30-230 bps decline

Domestic segment revenue fell 25% QoQ to ₹1,759.2 Cr, which could signal client churn or project completions without replacement

International services USD revenue was flattish QoQ at $82.4M, with only 0.6% constant currency growth, indicating sluggish demand in core markets

New CEO for international business may cause near-term disruption in client relationships and deal execution

Q4 miss attributed to two large clients' budget cuts; reliance on key accounts heightens vulnerability

Filing lacks any performance or guidance data, leaving investors without recent business trends until AGM on June 9, 2026

Secretarial compliance filing provides no operational or financial metrics; investors must rely on separate filings for performance assessment

Top 10 clients contributed 54% of revenue; any loss among these could disproportionately impact revenue

Margins from acquisition expected to build over ~6 quarters, with EPS accretion only from FY27; integration execution is critical

Closed early Q4, EPS accretive from FY27; margins expected to build over 6 quarters, providing a medium-term catalyst for margin expansion

Excluding North American real estate contract, Q4 revenue grew 31% YoY (25% USD); organic business grew 12% USD, indicating strong core demand

AI-led pipeline of $280M (5.7x the $49M order book) offers significant conversion opportunity; two large deals won in Q4 demonstrate execution capability

EBITDA margin improved 70 bps QoQ to 20.2%; continued operational efficiencies could drive further expansion

Record date May 25, 2026 for ₹31 per share dividend; investors seeking dividend yield may accumulate before ex-date

Large deal with global fintech for core banking modernization and AI implementation could become a reference case and drive further wins

MST added a new annuity client and significant scope expansion in Q4, providing recurring revenue visibility

Timely compliance filing reinforces strong corporate governance, reducing regulatory risk for long-term investors

Despite flat revenue, EBITDA margin improved; if revenue growth resumes, operating leverage could boost profitability further

If FY27 guidance proves conservative and macro improves, current valuation may offer a buying opportunity given 18.1% FY26 growth and strong organic trends

Sonata's $280M AI pipeline and 18% AI-led order book contrast with NIIT's lack of AI mentions, suggesting companies investing in AI are better positioned for future deals. Sonata's large fintech AI deal underscores this trend.

NIIT guides margin compression (18-20% vs 20.3% FY26) while Sonata expanded margins 70 bps QoQ to 20.2%. This divergence reflects different strategies: NIIT investing in acquisition integration, Sonata focusing on operational efficiencies.

Sonata's domestic revenue fell 25% QoQ while international was flat, indicating weak Indian enterprise IT spending. NIIT's global focus (US, Europe) showed better resilience (organic 12% USD growth).

Both NIIT (high single-digit guidance) and Sonata (flat international) hint at macro uncertainty and slower client decisions, a common theme across IT services in Q4 FY26.

NIIT pursued M&A (SweetRush) to boost growth, while Sonata focused on organic AI deals. The market will reward the model that delivers on integration vs pipeline conversion.

TCS maintains dividend payout (₹31/share) despite no new buyback or special dividend announcements, reflecting stable cash flow and shareholder return policy. No similar announcements from others.

Monitor revenue growth and margin against guidance; first quarter of FY27 will reveal if high single-digit guidance is achievable or if further cuts are needed.

Track client feedback and deal wins under new international CEO Rajsekhar Datta Roy; any disruption could impact Q1 FY27 performance.

Watch for conversion of $280M pipeline into orders; any large deal announcements in coming months would be a strong positive signal.

Expect management commentary on demand trends, AI investments, and FY27 outlook; dividend record date May 25, 2026 also key for yield investors.

Monitor margin trajectory over next 2 quarters; any acceleration in margin build could lead to guidance upgrade.

Look for Q1 FY27 results or annual report to assess performance; current filing provides no operational data.

Both NIIT and Sonata cited macro uncertainty; watch global IT spending surveys and US interest rate decisions for sector impact.

Domestic segment decline of 25% QoQ needs reversal; monitor large deal wins in India to gauge demand revival.