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Key Conference Call Highlights

Segment Performance

* Manufacturing and Resources (to be renamed "Production"): Witnessed flattish growth of 0.5% QoQ in Q4. The management is consolidating manufacturing, energy, and utilities under the "Production" segment starting Q1FY27.

* HLS, Public Services and Consumer Business: HLS & PS grew 8.9% QoQ and will be merged into the Consumer business reporting for FY27 Consumer Business grew 2.5% QoQ in Q4.

* BFSI: Recorded modest growth of 4.9% QoQ in Q4. While the vertical outside of the top client grew double digits; the top BFSI client saw a sharp decline as management pushed for a "productivity benefit accelerator" to bottom out that account's specific AI-led journey.

* Tech, Media and Communication (TMC): Grew 8.3% QoQ in Q4. However, the segment saw a faster-than-expected recovery in Q4 due to the rapid ramp-up of cloud acceleration programs.

Geographical Performance

* Europe: The management aims to continue growing Europe faster than the Americas by focusing on "white spaces" like sovereign solutions.

* ROW: Delivered strong growth of 11.6%.

* Americas: Grew 4% for the year. While it remains the company's largest market, management is looking to double down on the consumer market segment within the region.

Margin Trajectory

* Margin Performance: LTM reported an operating EBIT margin of 15.4% for FY26, up 90 bps YoY. The operating EBIT margin for the fourth quarter was 15.1%, down 100 bps. This contraction was primarily driven by partial wage hike effective January 1st and productivity commitments made in key accounts, which were partially offset by forex benefits.

* Efficiency Programs: Margin was supported by the "Fit-for-Future" program, which focused on cost optimisation. Under the "Lakshya '31" strategy, the company intends to expand its margin further through the "New Horizons" track focussed on operating efficiency.

Outlook & Guidance

* Lakshya '31 Strategy: The company launched its five-year strategic framework with the ambitious goal of doubling revenue in five years. This implies an approximate 15% CAGR.

* FY27 Expectation: The management expects to deliver industry-leading growth for the full year.

* Order Inflow: Total order inflow for FY26 stood at USD 6.6 Bn (up 10.3% YoY), with six deals exceeding USD-100 Mn in contract value. Inflow has exceeded USD 1.5 Bn for six consecutive quarters.

* Inorganic Growth: The five-year plan includes an inorganic component, with management evaluating acquisitions which provide jumpstarts into newer competencies (like sovereign AI) or white-space client segments like aerospace and defense in Europe.

AI Initiatives

* BlueVerse Ecosystem: This is the company's foundation for AI-centric capabilities, featuring the BlueVerse Foundry and specialised platforms like AgentIQ and AppIQ for AI orchestration.

* Service Realignment: Traditional service lines have been realigned into three new AI-led categories: I-Run (AI-enabled technology operations), ITransform (modernisation to make clients "AI-ready"), and Business AI (applying domain-led AI to reimagine processes).

* Talent and Partnerships: Approximately 70% of developers are already on GitHub Copilot. The company has forged strategic AI partnerships with NVIDIA, Salesforce, and ServiceNow and it was named NVIDIA's Rising Star Consulting Partner of the Year.

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