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Sagility shares jump 8% defying market weakness; why is stock in demand?
At 11:33 AM, Sagility share price was trading 5.8 per cent higher at ₹44.87 per share on BSE. In comparison, the BSE Sensex slipped 0.45 per cent to 44.87. The market capitalisation of the company stood at ₹21,454.53 crore. The 52-week high of the company stood at ₹56.44 per share, and the 52-week low was at ₹27.02.
Sagility Q1 results details
In Q1, Sagility reported a 38 per cent rise in consolidated adjusted net profit at ₹199.7 crore, as compared to ₹144.7 crore a year ago. The revenue for the quarter under review stood at ₹1,538.9 crore, as compared to ₹1,223.3 crore a year ago, up 25.8 per cent.
The adjusted Earnings before interest, tax, depreciation, and amortisation (Ebitda) stood at ₹368.7 crore, as compared to ₹291.6 crore year-on-year (Y-o-Y), up 26.5 per cent, and the adjusted Ebitda margin stood at 24 per cent, as compared to 23.8 per cent Y-o-Y.
JM Financial Institutional Equities maintained a 'Buy' call on Sagility and raised the target price to ₹64 per share from ₹68. The brokerage also increased its earnings per share (EPS) estimates by 3-4 per cent for FY26-28.
"Sagility trades at a discount to most of its listed business process outsourcing (BPO) players, despite high visibility to its earnings and 6 per cent free cash flow (FCF) yield. That is an anomaly, in our view. We value it at 30x (c.1x PEG)," the brokerage report read.
Sagility management commentary
Management remains reasonably confident of achieving low-to-mid teens organic growth in FY26, supported by healthy pipeline visibility, an increase in outsourcing, and a seasonally stronger H2.
Including BroadPath, FY26E revenue growth could exceed 20 per cent. Notably, the outlook factors in early signs of automation-led productivity gains, with higher client volumes and continued wallet share gains expected to offset cannibalisation.
Despite macro headwinds, Sagility expects over 24 per cent adjusted Ebitda margin for FY26, aided by cost discipline.
The business continues to benefit from nondiscretionary demand and deeper client engagements across payer and provider segments. -Management also sees meaningful upside from mid-market penetration and newer use cases in GenAI.
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