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CAPITALNUMBERS INFOTECH LIMITED — Q4 FY26 earnings call

Call held 4 Jun 2026

Company page: CAPITALNUMBERS INFOTECH share price, financials & guidance record

Management summary

CapitalNumbers reported a 9.4% YoY increase in total income to INR 115.60 crores for FY26, though this was below internal expectations due to delayed deal closures. The company maintained a healthy 31% EBITDA margin and remained debt-free with strong liquidity. Strategic investments in AI capabilities, global business development, and the proposed acquisition of Epitome Cloud Inc. are aimed at driving future growth, with a FY27 revenue growth target of 35% and EBITDA margin recovery to 33%.

Highlights

  • Total income grew 9.4% YoY to INR 115.60 crores in FY26, with revenue from operations increasing to INR 105.05 crores from INR 99.7 crores in FY25.

  • EBITDA remained healthy at INR 35.80 crores (vs. INR 35.69 crores in FY25), maintaining a 31% margin, reflecting resilience despite investments.

  • Secured two Fortune 500 client wins in H2 FY26, one in life sciences/healthcare and one in chemical/materials, strengthening enterprise positioning.

  • AI-related revenue exceeded 10% of total company revenue for the first time in FY26, validating strategic investments in AI capabilities and talent.

  • The company remained fully debt-free with a current ratio of 29.8 times and strong liquidity, holding INR 171.3 crores in total cash and investments.

Concerns

  • FY26 revenue growth of 9.4% was below internal expectations due to elongated enterprise decision-making cycles and delayed ramp-ups in certain large engagements during H2.

  • PAT slightly declined to INR 25.50 crores in FY26 from INR 25.80 crores in FY25, and Basic EPS decreased to INR 10.44 from INR 11.83, primarily due to the impact of a full-year weighted average post-IPO share count.

  • Investments in Middle East business development did not reflect in planned H2 revenue, leading to a strategic pivot in marketing focus away from the region due to geopolitical uncertainties.

Key financials

  1. Total Income ₹115.6 Cr +9.4%YoY
  2. Revenue from Operations ₹105.05 Cr +5.4%YoY
  3. EBITDA ₹35.8 Cr +0.31%YoY
  4. EBITDA Margin 31%
  5. PAT ₹25.5 Cr -1.2%YoY
  6. PAT Margin 22.1%
  7. Basic EPS ₹10.44 -11.8%YoY
  8. Operating Cash Generation ₹17.29 Cr
  9. AI-related Revenue Share 10%

What they filed

Q4 FY26: revenue up 10.6%, net profit up 0.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ4 FY24Q2 FY25Q4 FY25Q2 FY26Q4 FY26
Revenue47 50 50 53 52 +11%
EBITDA15 17 12 14 11 −27%
Net profit11 14 12 15 11 +0%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

medium confidence

Pipeline

deal pipeline tcv

500 qualified leads and multiple enterprise opportunities currently under active discussion

Cancellations & deferrals

  • deferred: Elongated enterprise decision-making cycles and delayed ramp-ups in certain large engagements, some of which now shifted into financial year '27.
Management noted elongated decision-making cycles and delayed ramp-ups for large engagements, with some shifting to FY27, but also reported 500 qualified leads and two Fortune 500 client wins.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Debt disclosed
    Most importantly, the company continued to remain fully debt-free with a current ratio of approximately 29.8 times, providing strong liquidity and financial flexibility.
  • M&A Epitome Cloud Inc. Acquisition · Announced · Consideration ₹40 Cr

    Strengthens US market presence, enterprise client access, expands capabilities in premium enterprise technology segments (Salesforce consulting, CPQ, revenue life cycle transformation), enhances access to certified Salesforce and enterprise technology talent, supports future growth objectives and service diversification.

    Expected to contribute approximately 25% to 30% of FY27 revenue; adjusted EBITDA margin in line with company expectation and will not deteriorate existing EBITDA percentage.

    As disclosed, due diligence has been completed and definitive documentation discussions are currently in advanced stages. Epitome Cloud is a US-incorporated technology services company headquartered in New Jersey with an Indian subsidiary operating delivery centers in Bangalore and Hyderabad. The company specializes in Salesforce consulting, CPQ and revenue life cycle transformation. ... The total consideration amount for Epitome Cloud would be about INR40 crores. ... The company's topline is around INR30 crores and its EBITDA margin is around. ... we believe approximately 25% to 30% would be coming through this acquisition.
  • Liquidity Cash ₹88.62 Cr Total cash and investment (including current investments and long-term fixed deposits) stood at INR 171.3 crores, providing substantial financial flexibility.
    Cash and bank balances at the year-end stood at INR88.62 crores, while current investments increased to INR81.13 crores. ... Long-term fixed deposits stood at approximately INR1.6 crores. This resulted in a total cash and investment of approximately INR171.3 crores.

Guidance & targets

Revenue

  • Revenue Growth Revenue · FY27 · High confidence minimum 35%
    Looking ahead to financial year 27, based on the current visibility, active pipeline discussions and expected business momentum, management is targeting a minimum 35% revenue growth in INR terms during financial year 27

    — Mukul Gupta

  • Topline Revenue · next three years · High confidence INR 200 crores
    our goal as our intention for the next three years is to achieve INR200 crores top line maintaining the current EBITDA margin and improving it.

    — Mukul Gupta

Profitability

  • EBITDA Margin Profitability · FY27 · High confidence towards 33%
    along with a gradual EBITDA margin recovery towards 33%.

    — Mukul Gupta

  • EBITDA Margin Profitability · next three years · High confidence maintaining and improving current EBITDA margin
    our goal as our intention for the next three years is to achieve INR200 crores top line maintaining the current EBITDA margin and improving it.

    — Mukul Gupta

Dividend

  • Dividend Payout Ratio Dividend · current profit · High confidence 20% to 25%
    And we plan to distribute around 20% to 25% of our current profit as a dividend.

    — Sanket Harlalka

Other

  • Mid-cap Listing Other · in three years · Medium confidence move from SME to main board
    we want to double the company in three years. At that point, we can think of listing in the mid-cap segment, moving from the SME to the main board. That is in our pipeline.

    — Sanket Harlalka

What to watch in Q1 FY27

Epitome Cloud Acquisition Completion

Within 8-12 weeks
Current Due diligence completed, definitive documentation in advanced stages
Target Acquisition closed

Why it matters

Completion of this acquisition is a key inorganic growth driver, expanding capabilities and US market presence.

We expect it to complete within 8 to 12 weeks.

Risks & concerns

  • Global Economic Uncertainty

    high

    Identified as the 'biggest headwind' currently facing the sector, impacting client spending patterns.

    Management acknowledged

  • Elongated Enterprise Decision-Making Cycles

    medium

    Delayed ramp-ups in large engagements and slower contract closures impacted H2 FY26 revenue growth and shifted projects to FY27.

    Management acknowledged

  • Geopolitical Uncertainty in Middle East

    medium

    Uncertainty led to reduced commitment for trade shows and a cautious approach to new business in the region.

    Management acknowledged

  • AI Talent Availability

    medium

    The question of talent availability around AI is becoming challenging, posing a risk to AI capability development and project delivery.

    Management acknowledged

Q&A highlights

6 direct, 1 evasive
Organic Growth and FY27 Revenue Target Composition Direct
if you look at the current top-line of the company, then we expect that there would be a churn of approximately 10% and then we will be adding approximately let's say INR20 crores, INR25 crores in terms of net new revenue and approximately INR30 crores through acquisition. As these things play out, we expect that the total growth in the company should be around 35% at the most pessimistic level.

Clarifies the components of the 35% FY27 revenue growth target, distinguishing between organic net new revenue and acquisition contribution after accounting for client churn.

Asked by Deepak Poddar

EBITDA Margin Calculation Including Other Income Direct
My EBITDA margin is -- the total EBITDA is 35.79%, right, for the year? And the total revenue is INR115.6 crores. So it's 31%. ... Yes, we are including other income. That is what the base formula actually is.

Resolves analyst confusion regarding the 31% EBITDA margin by clarifying that the calculation includes other income in the total revenue denominator, aligning with standard formula.

Asked by Deepak Poddar

Shift in Marketing and Business Development Strategy Direct
we just sort of pivoted away from doing more events in Middle East to reinvestment in US, Europe, and this demand gen team that is again we have started a new practice in the company.

Explains the strategic shift in marketing spend from Middle East trade shows (due to uncertainty) to establishing a physical US presence, increasing US/Europe events, and building an outbound demand generation team.

Asked by Sanket Sadh

IPO Expenses and Promoter Reimbursement Direct
the total IPO-related expenses is around INR21 crores, out of which promoters has incurred meaning, reimbursed around INR11 crores. So the net expenses will stood at between INR9 crores to INR10 crores for the company.

Provides clarity on the actual net IPO expenses borne by the company after promoter reimbursement, addressing a prior quarter's accounting query.

Asked by Imran

Strategic Rationale for Epitome Cloud Acquisition and Future M&A Focus Direct
predominantly what we are looking for as our next acquisition is a company which is already -- which has a domain expertise in AI, preferably vertical, some vertical experience in either fintech or healthtech.

Details the strategic criteria for future acquisitions, emphasizing AI domain expertise within specific verticals like fintech or healthtech, and how Epitome Cloud fits into expanding Salesforce capabilities.

Asked by Chintan Parikh

Valuation of Epitome Cloud Acquisition per Employee Partial
To correct you, sir, as Mukul sir has already said, there are seven persons that are onsite in US where the billing rate is very high and the cost is also very high. So, if you consider, apart from seven person, 45 are from India and they are working on the niche technology. So, considering that and the projected EBITDA, we consider it a very reasonable acquisition.

Addresses analyst's concern about the high acquisition cost per employee for Epitome Cloud by highlighting the high-value US onsite resources and niche technology expertise.

Asked by Nisheeth Srivastava

Explanation for FY26 Growth Miss Direct
The growth didn't happen primarily because in H2, we didn't expect whatever new contract closures that we expected, the time it took to close those new contracts has been higher. So, I mean, we didn't -- the contract that we took didn't materialize in a way we thought it would materialize.

Provides a direct explanation for the company missing its prior growth targets, attributing it to delays in contract closures and materialization in the second half of the fiscal year.

Asked by Anuj Kumar Ghosh

Shareholder Buyback Consideration Evasive
Right now, we have not considered any buyback. So, we plan to utilize our capital towards growth and expansion. ... Maybe it can be rethought after a year or some time.

Analyst pressed for a buyback given the low share price and high cash balance, but management reiterated focus on growth and acquisitions, deferring any buyback decision.

Asked by Deepak Poddar

3 min read 6 chapters

Detailed narrative

FY26 Financial Performance and Growth Headwinds

CapitalNumbers reported a total income of INR 115.60 crores for FY26, marking a 9.4% year-on-year growth, with revenue from operations at INR 105.05 crores. However, this growth was below internal expectations, primarily due to elongated enterprise decision-making cycles and delayed ramp-ups in large engagements during H2 FY26, with some projects shifting into FY27. Despite these challenges, the company maintained a healthy EBITDA of INR 35.80 crores, resulting in a 31% margin, though PAT slightly declined to INR 25.50 crores from INR 25.80 crores in FY25, and EPS was INR 10.44.

Strategic Investments and AI Focus

The company continued its strategic investments in long-term growth areas, including business development, leadership hiring, AI capability development, enterprise sales, and delivery expansion. AI-related revenue exceeded 10% of total company revenue for the first time in FY26, driven by substantial investments in AI capabilities, talent, and an AI Center of Excellence. This focus aims to not only deliver AI projects for clients but also to improve internal productivity and scalability, with expanded AI/ML hiring initiatives in the Gurgaon center.

Proposed Acquisition of Epitome Cloud Inc.

CapitalNumbers announced the proposed acquisition of Epitome Cloud Inc., a US-based technology services company specializing in Salesforce consulting, CPQ, and revenue lifecycle transformation, for INR 40 crores. This acquisition, expected to contribute INR 28 crores to topline (CY26) and 25-30% of FY27 revenue, is strategic for strengthening US market presence, expanding capabilities in premium enterprise technology segments, and accessing certified Salesforce talent. The deal is expected to close within 8-12 weeks and will be funded through IPO proceeds and internal accruals, without external debt.

Capital Allocation and Shareholder Returns

The company remains fully debt-free with strong liquidity, holding INR 171.3 crores in total cash and investments as of March 31, 2026. Capital allocation prioritizes growth and future acquisitions, with plans for two to three more acquisitions in AI-focused domains like fintech or healthtech. CapitalNumbers distributed an interim dividend of 10% of face value and proposed a final dividend of another 10%, targeting a total payout ratio of 20-25% of current profit. Management, however, stated they are not currently considering a share buyback, despite analyst suggestions, preferring to utilize capital for growth and expansion.

FY27 Outlook and Growth Drivers

For FY27, CapitalNumbers is targeting a minimum 35% revenue growth in INR terms, alongside a gradual EBITDA margin recovery towards 33%. This guidance is underpinned by expected operating leverage from Gurgaon expansion, productivity gains from recent senior hires, improved utilizations, and higher-value enterprise engagements. The company aims to achieve a INR 200 crores topline within the next three years, with an aspiration to move from the SME platform to the main board, reflecting confidence in its strategy and future growth potential.

Revised Marketing Strategy and Geographic Focus

Due to geopolitical uncertainties in the Middle East, CapitalNumbers has reduced its commitment to trade shows in the region, pivoting investments towards US and European markets. This includes participation in events like London Tech Week and establishing a dedicated outbound demand generation team for European leads. The company secured two Fortune 500 client wins in FY26, demonstrating success in higher-value enterprise engagements, and aims to leverage its new US physical presence post-acquisition to further expand its client base and improve customer services.

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