Sagility
Sagility
Information Technology F&OKey Fundamentals
SmallcapIT Enabled ServicesInformation TechnologyTapetide Score
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Key Insights
Strengths
1- Company has reduced debt.
Weaknesses
1- Company has a low return on equity of 7.59% over last 3 years.
Growth Rate
AI Analysis — Bull vs Bear
Sagility Ltd is a technology-enabled business process management company serving US healthcare payers and providers, with a market cap of about ₹20,879 crore at a P/E of 21.2 and P/B of 2.18. Growth has been strong, with TTM sales up 29% and TTM profit up 54%, and Q1 FY27 revenue of ₹1,963.5 crore was up 27.6% YoY (15.2% in constant currency). Returns on capital are still modest: ROE averaged about 7.59–8% over three years and was 11% last year, while the stock has returned 4% over one year.
- Revenue growth has been high and consistent. TTM sales grew 29% and the 3-year sales CAGR is 19%, and Q4 FY26 revenue rose 29% YoY to ₹2,024.2 crore from ₹1,340 crore.
- Profits are growing faster than revenue. The 3-year profit CAGR is 86% and TTM profit growth is 54%, and FY26 adjusted PAT rose 39.5% YoY to ₹1,130.6 crore at a 15.7% margin.
- Margins are steady. Q4 FY26 EBITDA rose 30% YoY to ₹484.5 crore, and the EBITDA margin held at about 24%, which shows the company scaled without giving up profitability.
- Growth has held up even after stripping out currency effects. Q1 FY27 constant-currency growth was 15.2% and organic growth was above 14%, so the business is expanding beyond the BroadPath acquisition and rupee depreciation.
- Returns on equity are improving. ROE rose to 11% last year from a 5-year average of 6% and a 3-year average of 8%, and basic EPS of ₹1.98 was up 69.2% YoY.
- The balance sheet is getting stronger, with debt reduced, which lowers financial risk and frees cash flow for acquisitions or shareholder payouts.
- The valuation does not look stretched against growth. A P/E of 21.2 compares with 54% TTM profit growth and 19% sales CAGR, and the company paid a dividend in Q4 FY26 (0.33% yield).
- Returns on equity are low. The 3-year average ROE is 7.59%, and the 11% achieved last year is still below what many Indian IT/ITeS peers earn, partly because acquisition goodwill inflates the equity base.
- A large part of reported growth comes from currency. Q1 FY27 growth was 27.6% in rupee terms but only 15.2% in constant currency, so about 12 percentage points came from rupee depreciation, which could reverse.
- Revenue fell sequentially. Q1 FY27 revenue of ₹1,963.5 crore was 3.0% lower than ₹2,024.3 crore in Q4 FY26, reflecting the seasonality of US healthcare open enrollment, and management flagged wage pressure in the quarter.
- Reported and adjusted earnings differ significantly. Basic EPS of ₹1.98 compares with adjusted EPS of ₹2.42, a gap of about 18% driven largely by acquisition-related amortization, so headline profit quality needs scrutiny.
- The stock has barely moved. It returned 4% over one year despite 54% TTM profit growth, so strong earnings have not yet translated into shareholder returns.
- Revenue is concentrated in one sector and one country. Nearly all of it comes from US healthcare payers and providers, so the company is exposed to US regulatory, reimbursement and policy changes, as well as to a small set of large clients.
- The dividend yield is low at 0.33%, and a P/B of 2.18 against 7.59–11% ROE implies the market already expects returns to improve.
- The track record as a listed company is short. There is no 5-year or 10-year sales, profit or stock return history, which makes it harder to judge how the business performs across cycles.
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
- Built-in pricing deflation drag Sep 21
Sagility's medium-term low-to-mid-teens organic growth target already absorbs about 1.5-2.0% annual revenue deflation from pricing and productivity. Volume growth and service expansion need to keep offsetting it.
- Heavy US payer concentration Sep 21
About 90% of revenue comes from US healthcare payers. That leaves the company exposed to US healthcare policy, regulatory shifts and budget pressure at a narrow client segment.
- Emkay initiates Buy, ₹55 target Sep 21
Emkay Global started coverage on Sep 20, 2026 with a Buy rating and a 12-month target of ₹55, about 20% upside, valued at 18x Sep 2028E adjusted EPS. It sees ~15% revenue CAGR and ~20% EPS CAGR over FY26-29E, with EBITDA margin rising to 18.1% as stated in the report.
- FY27 guidance: double-digit growth Sep 21
Management expects low double-digit organic growth and a 24-25% adjusted EBITDA margin in FY27. Emkay says sticky, nondiscretionary payer operations and growing outsourcing pressure from rising healthcare costs support this outlook.
- FY26 final dividend processed Sep 25
Sagility has paid its FY26 final dividend of ₹0.10 per share. Shareholders with incomplete bank or KYC details must update them with their DP to receive withheld payments.
- Jefferies India Forum attendance Sep 15
Company officials attended the 2026 Jefferies India Forum in Gurugram on Sep 18, 2026. The company said no unpublished price-sensitive information would be shared.
TL;DR: Sagility's story rests on recurring, nondiscretionary healthcare operations for US payers. Emkay's Buy initiation at ₹55 (about 20% upside) and management's FY27 guidance of low double-digit growth with 24-25% adjusted EBITDA margins support it. The main risks are concentration, with about 90% of revenue from US payers, and 1.5-2.0% annual pricing deflation that volume growth has to keep beating. Sentiment is improving as sell-side coverage expands, but delivery on the FY27 organic growth guidance will decide whether the rerating holds.
Quarterly Results
| Particulars | Jun 2023 | Sep 2023 | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 1,116 | 1,094 | 1,260 | 1,283 | 1,223 | 1,325 | 1,453 | 1,568 | 1,539 | 1,658 | 1,971 | 2,024 | 1,963 |
| Expenses | 852 | 860 | 1,000 | 976 | 1,029 | 1,024 | 1,061 | 1,195 | 1,193 | 1,243 | 1,460 | 1,540 | 1,525 |
| Operating Profit | 264 | 234 | 260 | 307 | 194 | 301 | 392 | 373 | 346 | 415 | 511 | 485 | 438 |
| OPM % | 24% | 21% | 21% | 24% | 16% | 23% | 27% | 24% | 22% | 25% | 26% | 24% | 22% |
| Other Income | 11 | 29 | 6 | 5 | 24 | 15 | 44 | 10 | 10 | 58 | -24 | 25 | -1 |
| Interest | 47 | 48 | 47 | 43 | 37 | 30 | 30 | 30 | 27 | 25 | 25 | 22 | 22 |
| Depreciation | 166 | 171 | 176 | 176 | 110 | 126 | 116 | 114 | 118 | 122 | 124 | 124 | 128 |
| PBT | 62 | 43 | 44 | 93 | 71 | 160 | 290 | 239 | 210 | 327 | 339 | 363 | 287 |
| Tax % | 31% | 19% | -62% | 14% | 69% | 27% | 25% | 24% | 29% | 23% | 21% | 29% | 25% |
| Net Profit | 42 | 35 | 71 | 80 | 22 | 117 | 217 | 183 | 149 | 251 | 268 | 258 | 217 |
| EPS in Rs | 0.22 | 0.18 | 0.37 | 0.19 | 0.05 | 0.25 | 0.46 | 0.39 | 0.32 | 0.54 | 0.57 | 0.55 | 0.46 |
Profit & Loss
| Particulars | Mar 2022 8m | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | TTM |
|---|---|---|---|---|---|---|
| Sales | 923 | 4,218 | 4,754 | 5,570 | 7,193 | 7,617 |
| Expenses | 730 | 3,179 | 3,665 | 4,263 | 5,428 | 5,768 |
| Operating Profit | 193 | 1,039 | 1,088 | 1,307 | 1,765 | 1,849 |
| OPM % | 21% | 25% | 23% | 23% | 25% | 24% |
| Other Income | 18 | 5 | 28 | 47 | 61 | 58 |
| Interest | 65 | 215 | 185 | 127 | 99 | 94 |
| Depreciation | 147 | 644 | 689 | 467 | 487 | 497 |
| PBT | -2 | 186 | 242 | 760 | 1,239 | 1,316 |
| Tax % | 152% | 23% | 6% | 29% | 25% | — |
| Net Profit | -5 | 144 | 228 | 539 | 925 | 993 |
| EPS in Rs | -0.02 | 0.75 | 0.53 | 1.15 | 1.98 | 2.12 |
| Div. Payout % | 0% | 0% | 0% | 0% | 8% | — |
Balance Sheet
| Particulars | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|
| Equity Capital | 1,919 | 1,919 | 4,285 | 4,679 | 4,679 |
| Reserves | 2,108 | 4,288 | 2,158 | 3,657 | 4,980 |
| Borrowings | 4,788 | 2,896 | 2,532 | 1,402 | 1,111 |
| Other Liabilities | 1,271 | 1,427 | 1,554 | 1,179 | 1,680 |
| Total Liabilities | 10,085 | 10,529 | 10,529 | 10,917 | 12,450 |
| Fixed Assets | 8,621 | 8,607 | 8,667 | 8,997 | 9,352 |
| CWIP | 5 | 0 | 6 | 0 | 43 |
| Investments | 0 | 0 | 0 | 0 | 336 |
| Other Assets | 1,459 | 1,922 | 1,856 | 1,920 | 2,719 |
| Total Assets | 10,085 | 10,529 | 10,529 | 10,917 | 12,450 |
Cash Flow
| Particulars | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|
| Operating | -32 | 857 | 973 | 1,214 | 1,203 |
| Investing | -7,711 | -101 | -463 | -958 | -687 |
| Financing | 8,116 | -545 | -751 | -256 | -501 |
| Net Cash Flow | 374 | 211 | -241 | 0 | 14 |
| Free Cash Flow | -39 | 716 | 791 | 1,092 | 1,011 |
| CFO/OP | -12 | 99 | 101 | 106 | 89 |
Ratios
| Particulars | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|
| Debtor Days | 366 | 92 | 91 | 83 | 93 |
| Cash Conversion Cycle | 366 | 92 | 91 | 83 | 93 |
| Working Capital Days | 58 | 13 | -6 | 25 | 7 |
| ROCE % | — | 5% | 5% | 10% | 13% |
Insights
BetaAI-extracted from concalls & annual reports · figures as reported, with sources
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61 extracted metrics + investor summaries across FY22–FY27.
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Company Information
Incorporated in July 2021, Sagility India Limited (formerly Berkmeer India Pvt. Ltd) provides healthcare-focused technology-enabled solutions and services primarily to U.S.-based clients in the payer and provider segments.[1]
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