Why Sagility’s Upgraded FY26 Guidance Signals Strong Growth Momentum
About Sagility
Sagility, a healthcare-focused business process management company, has delivered one of its strongest quarters in recent times. With deep domain expertise across payer and provider segments, the firm continues to scale digital capabilities and expand GenAI-led offerings. The management’s commentary during the Q2FY26 concall revealed a clear focus on growth through technology integration, margin expansion, and client diversification.
Q2FY26 Concall Highlights
The management upgraded its FY26 guidance, reflecting confidence in continued growth. Revenue growth is now expected to exceed 21% YoY in constant currency terms, while adjusted EBITDA margins have been raised to ~25%, supported by operational efficiency and automation gains.
Revenue for the quarter stood at ₹16,585 Mn, up 25.2% YoY. PAT surged 84% YoY to ₹3,100 Mn, driven by stronger execution and currency tailwinds. Management indicated that the second half of FY26 will contribute roughly 53–54% of total annual revenue.
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| Metric | Q2FY26 | YoY Change |
|---|---|---|
| Revenue | ₹16,585 Mn | +25.2% |
| EBITDA Margin | 26.2% | +100 bps |
| PAT | ₹3,100 Mn | +84% |
| Client Count | 82 | +5 additions |
| Attrition | 26.3% | Stable |
Peer Comparison & Valuation Metrics
Sagility’s valuation remains attractive compared to leading BPO peers given its focused verticalization and healthy cash flows. It trades at a reasonable multiple considering its robust margin profile and consistent dividend payout.
| Company | P/E (x) | EBITDA Margin (%) | Revenue Growth (%) | ROE (%) |
|---|---|---|---|---|
| Sagility | 24.6 | 26.2 | 25.2 | 19.8 |
| Coforge | 31.1 | 18.7 | 15.4 | 17.2 |
| Firstsource | 21.3 | 14.5 | 11.1 | 13.0 |
SWOT Analysis
| Strengths | Weaknesses | Opportunities | Threats |
|---|---|---|---|
| Strong healthcare domain specialization and GenAI integration. | Moderate client concentration risk with top 10 contributing majority revenue. | Expansion into new AI-based contracts and payer-provider verticals. | Potential slowdown in US healthcare IT budgets. |
Investment Verdict
Sagility’s performance underscores a structurally strong business model. The company’s margin expansion trajectory and guidance upgrades reinforce confidence in sustainable growth. Its valuation remains reasonable at ~25x FY26E earnings given high visibility and superior operating leverage.
Verdict: Ideal for long-term investors (2–3 years) seeking exposure to high-margin healthcare BPO growth themes.
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Investor Takeaway
Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, who is also a SEBI Registered Investment Adviser, highlights Sagility’s upgraded guidance and strong client metrics as a sign of continued resilience in the healthcare outsourcing segment. Investors should consider accumulating on corrections with a long-term horizon, focusing on operational consistency and digital transformation gains.
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Related Queries on Healthcare BPO Stocks
- Is Sagility’s growth sustainable beyond FY26?
- Which healthcare outsourcing stocks have the best margins?
- How does Sagility compare to Coforge and Firstsource on valuation?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
