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Growth Visibility Strengthens; Reiterate BUY We remain constructive on OFSS, supported by strengthening deal momentum, a high-margin products mix and robust cash generation. Remaining Performance Obligations (RPO) growth of 9.2% QoQ enhances medium-term revenue visibility. Recent deal wins, improving cost-efficiency and pricing discipline are driving operating leverage, leading to an upward revision in margin estimate. We model Revenue/EBITDA/PAT CAGR of 10.3%/12.1%/13.1% over FY26–29E and value the company at 28x FY28E EPS, deriving a TP of INR 10,890 and reiterate BUY, supported by a strong balance sheet and favourable riskreward. We believe the premium multiple is justified by its product-led model, driving superior margins and scalability, along with strong Oracle parentage that supports global positioning and client confidence.

Revenue & EBITDA Beat Estimate; Margin Expands due to Operating Leverage

* Q4FY26 revenues stood at INR 20,652 Mn, up 20.3% YoY and 5.1% QoQ (vs CIE est. INR 19,789 Mn), driven by strong execution and strategic new customer wins. For FY26, revenues stood at INR 76,721 Mn, up 12.1% YoY (vs CIE est. 75,858 Mn)

* Revenue from products business grew by 21.4% YoY to INR 18,706 Mn and service business grew by 10.8% to 1,946 Mn.

* EBITDA came in at INR 10,563 Mn (vs CIE est. at INR 8,775 Mn), up 38.1% YoY due to higher operating leverage while EBITDAM came in at 51.1% (vs CIE est at 44.3%), up 660 bps YoY. For FY26, EBITDAM stood at 45.3%, up 40 bps YoY (vs CIE est. at 43.5%) ? PAT for the quarter came in at INR 8,417 Mn up 30.7% YoY (vs CIE est. 7,051 Mn) while PAT margin came in at 40.8% up 320 bps YoY. EPS for Q4FY26 is INR 96.7.

* Headcount declined by 60 employees QoQ, while attrition remained stable at 9.0% sequentially

* Remaining Performance Obligations came in at INR 77,610 Mn, up 9.2% QoQ.

* The Board declared a second interim dividend of INR 270 per equity share for the year ended FY26.

* DSO remained stable at 58 days at the end of the quarter.

Robust Growth driven by Product Segment; Landmark Deal Strengthens Outlook: OFSS reported a strong Q4FY26 performance, with revenues growing by 20.3% YoY, driven by continued momentum in the products business (+21% YoY), while services grew 11%, sustaining a high-margin mix. Deal momentum remains robust with a strong pipeline and RPO growth of 9.2% QoQ, enhancing medium-term revenue visibility. The quarter was supported by robust deal wins and client expansions, the key highlight being a landmark deal secured with a US-headquartered global bank, valued at approximately USD 100 Mn, underscoring its strength in large-scale, mission-critical banking transformation.

Margin Expansion Accelerates; Operating Leverage Kicks in: EBITDA grew 38.1% YoY, margin expanded 660 bps to 51%, driven by strong operating leverage from scale, favourable product mix and disciplined cost execution. Margin expansion was further supported by AI-led productivity gains, enabling leaner team structure, faster delivery and improved cost-efficiency. Continued traction in high-margin products, alongside increasing cloud and AI-led offerings, is sustaining both, growth and profitability.

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