Ecos (India) Mobility & Hospitality Limited — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Ecos (India) Mobility & Hospitality Limited reported robust revenue growth for Q3 and 9M FY26, driven by strong demand in both employee transportation and chauffeur-driven car rental segments. While client acquisition and trip volumes saw significant increases, profitability was impacted by higher operational costs associated with onboarding new clients and increased employee expenses. Management outlined strategies to improve margins in the coming quarters, including price adjustments and vendor rationalization.

Highlights

  • Q3 FY26 Revenue of ₹206.071 crores, up 22.48% YoY, driven by strong performance in both ETS and CCR segments.

  • 9M FY26 Revenue of ₹601.398 crores, up 26.15% YoY, reflecting sustained momentum and operational footprint expansion.

  • Active client base increased by 34% YoY to 1,734, with 39 new clients onboarded in Q3 FY26.

  • Total trip volumes for 9M FY26 reached 3.84 million, with Q3 contributing 1.3 million trips, representing a healthy 31.29% YoY growth.

  • Client retention remains strong, with 55% of 9M revenue contributed by clients associated with ECOS for over 5 years.

Concerns

  • Q3 FY26 EBITDA margin compressed to 11.33% from 12.85% in Q3 FY25, impacted by higher variable and vendor-linked costs.

  • 9M FY26 EBITDA margin declined to 11.60% from 13.83% in the previous year, due to higher manpower deployment, fleet expansion, and non-recurring provisions.

  • Employee cost in Q3 FY26 increased by 44% YoY to ₹22.87 crores, attributed to new hires and yearly increments.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹206.071 Cr
    YoY +22.5%
  • EBITDA
    ₹23.355 Cr
    YoY +8.1%
  • EBITDA Margin
    11.3%
  • PAT
    ₹13.943 Cr
    YoY +9.1%

9M FY26

  • Revenue
    ₹601.398 Cr
    YoY +26.2%
  • EBITDA
    ₹69.776 Cr
    YoY +5.9%
  • EBITDA Margin
    11.6%
  • PAT
    ₹41.84 Cr

What they filed

Q1 FY27: revenue up 16.6%, net profit up 15.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue160 168 177 181 214 +34%206 +23%207 +17%211 +17%
EBITDA24 22 26 22 25 +4%23 +5%24 −8%22 +0%
Net profit16 13 18 13 15 −6%14 +8%16 −11%15 +15%
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.

Segment breakdown

SegmentRevenue Growth (Q3 FY26)Share of Total Revenue (Q3 FY26)
Chauffeur-driven Car Rentals (CCR)30%43%
Employee Transportation Services (ETS)24%57%

Capital allocation

high confidence
  • Capex ₹32 Cr
    • Fleet increase and replacement of old cars
    It should be -- for 25-26, it will be -- the full month will be around INR32 crores, not more than that around INR32 crores. (Hem Upadhyay, Page 7)
  • Liquidity Cash ₹120 Cr
    So currently, we have around INR120 crores plus in as a cash and cash equivalent in our books. (Hem Upadhyay, Page 10)

Guidance & targets

Revenue

  • Revenue Growth Revenue · full year · High confidence 15% to 20%
    But our over the long term our guidance remains between the 15% to 20% growth. At the same time, we hope that we are able to exceed these our own targets. (Rajesh Loomba, Page 6)

    — Rajesh Loomba

  • Revenue for Operating Leverage Inflection Point Revenue · Medium confidence INR1,000 crores to INR1,200 crores
    So we feel as a company that inflection point wherein the true operating leverages kick in would be anywhere between a INR1,000 crores to INR1,200 crores top-line revenue... (Rajesh Loomba, Page 14)

    — Rajesh Loomba

Profitability

  • PAT Margin Profitability · mid to long term · High confidence 8.5% to 10%
    No, so our PAT guidance has always been between 8.5% to 10-odd percent, not 10% to 12%. (Rajesh Loomba, Page 16)

    — Rajesh Loomba

  • EBITDA Margin Profitability · mid to long term · High confidence 13% to 15%
    And in terms of EBITDA, we are looking at anywhere between 13% to 15%, in the mid to long term. (Rajesh Loomba, Page 16)

    — Rajesh Loomba

  • Margin Normalization Profitability · next two to three quarters · Medium confidence normalized
    margins expected to normalize over the next two to three quarters as operations scale up with these clients. (Rajesh Loomba, Page 4)

    — Rajesh Loomba

What to watch in Q4 FY26

EBITDA Margin Normalization

next two to three quarters
Current 11.33% (Q3 FY26)
Target Improvement towards 13-15% band

Why it matters

Margin recovery is key to demonstrating operating leverage and sustainable profitability after investment phase.

margins expected to normalize over the next two to three quarters as operations scale up with these clients. (Rajesh Loomba, Page 4)

Risks & concerns

  • Margin Compression from New Client Onboarding

    medium

    Onboarding new enterprise clients involves higher startup and ramp-up costs, impacting margins for 2-3 quarters.

    Management acknowledged

  • Increased Variable and Vendor-Linked Costs

    medium

    Higher costs associated with servicing incremental volume and onboarding large enterprise accounts impacted Q3 EBITDA margins.

    Management acknowledged

  • Competitive Intensity in the Market

    low

    While competitive intensity is always present, management focuses on gaining market share and does not foresee 'bleeding' competition.

    Management downplayed

  • Impact of New Labor Code Provisions

    low

    Provisions of INR15 lakhs taken for 9M FY26 related to the new Labour Code, impacting profitability.

    Management acknowledged

  • Threat from Government-backed 'Bharat Taxi'

    low

    Management clarified that their B2B mobility solutions model is different from ride-hailing services like Bharat Taxi, hence not a direct threat.

    Analyst downplayed

Q&A highlights

7 direct
Q4 FY26 Top-line Growth Expectations Partial
Well, thank you for the question, Jainam. And I guess it's been going better than what we expected so far. And we hope for the same trends to continue. But our over the long term our guidance remains between the 15% to 20% growth. At the same time, we hope that we are able to exceed these our own targets.

Analyst questioned the full-year guidance given strong 9M growth, seeking clarity on Q4 expectations and potential for exceeding targets.

Asked by Jainam Shah

Reasons for Gross Margin Compression Direct
Typically, in the third quarter, even if you look at the previous quarters the margins are have been a little compressed because also our top line got affected because of a large number of public holidays, the GRAP in North India which carried on, but there is no and we also onboarded a lot of new enterprise clients. And what happens with these enterprise clients is initially during the scale-up and the ramp-up, the costs are typically much higher and it takes two or three quarters for the margins to normalize.

Analyst sought specific reasons for margin decline beyond provisions, highlighting the impact of new client onboarding and seasonal factors.

Asked by Jainam Shah

Surge in Employee Costs in Q3 FY26 Direct
And if you look at our cost increase in the HR cost, it's reflected in the fact that we have 258-odd more people on our rolls in terms of executives, and also there's the yearly increment that had happened.

Analyst questioned the significant 44% YoY increase in employee costs, which management attributed to new hires and annual increments.

Asked by Senthilkumar

Increase in Depreciation in Q3 FY26 Direct
That's because we have added around 250 more cars in the first nine months, which were both for fleet increase and for replacement of old cars.

Analyst inquired about the 29% YoY rise in depreciation, which management clarified was due to fleet expansion and replacement.

Asked by Senthilkumar

Margin Profile Difference between CCR and ETS Direct
Yes, so typically ETS has a lesser margin profile as compared to chauffeur-driven. But what we are able to finally present is a kind of blended margin, which you see on our financials.

Analyst sought to understand the inherent margin differences between the company's two core segments.

Asked by Hardik

Impact of Uber's Entry into ETS Market Direct
So we welcome all competition, especially in organized segment, because the unorganized market is so huge that the more number of players who are touting their credibility to convert the unorganized to organized only helps the organized part of the market... So we don't we don't foresee any kind of bleeding kind of competition coming in over here.

Analyst questioned the potential competitive and pricing pressure from Uber's entry into the ETS market, which management viewed as a positive for market organization.

Asked by Dikshit Doshi

Timeline for Margin Recovery Direct
No, I think in the long term mid to long term, our guidance remains the same of between 13% to 15%. And we should be able to recover our margins over the next few quarters.

Analyst pressed for a timeline on when margins could return to previous levels, with management indicating recovery over the next few quarters.

Asked by Dikshit Doshi

Status of Provision Recovery Direct
So we are taking the legal action for recovery of that money. So we think that should take a year to 18 months for the legal process to be concluded.

Analyst inquired about the recovery status of provisions made in previous quarters, with management detailing the legal process and timeline.

Asked by Jainam Shah

2 min read 7 chapters

Detailed narrative

Q3 & 9M FY26 Financial Performance Overview

Ecos (India) reported a Q3 FY26 revenue of ₹206.071 crores, marking a 22.48% year-on-year increase. For the nine-month period, revenue stood at ₹601.398 crores, up 26.15% YoY. EBITDA for Q3 FY26 was ₹23.355 crores, growing 8.05% YoY, with a margin of 11.33%, down from 12.85% in Q3 FY25. Profit after tax for Q3 FY26 was ₹13.943 crores, a 9.12% YoY increase, despite higher depreciation.

Strategic Focus and Digital Transformation Initiatives

The company's strategic focus remains on sustainable growth through new client onboarding, wallet share expansion, and geographic presence. Digital transformation is a key pillar, with over 21% of CCR bookings from corporate clients powered by ECOS CabDrive Pro, APIs, and customer app platforms. A direct web booking portal was also launched in Q3 FY26, extending enterprise-grade reliability to individual users and SMEs.

Operational Expansion and Client Growth

ECOS operates in over 131 cities in India and 30+ countries globally. The company inaugurated a new office in Bengaluru to deepen its footprint in a significant enterprise hub. During Q3 FY26, 39 new clients were onboarded, bringing the total active client base to 1,734, a 34% growth compared to Q3 FY25. For the nine-month period, 160 new clients were acquired.

Fleet Management and Trip Volumes

The company's fleet capacity expanded to over 19,000 vehicles, including 997 owned units, supporting an asset-light approach. Total trip volumes for the first nine months stood at 3.84 million, with 1.3 million trips undertaken in Q3 FY26, representing a healthy 31.29% year-on-year growth. This reflects sustained enterprise demand and efficient scaling across high-value mobility segments.

Margin Dynamics and Cost Pressures

EBITDA margin for Q3 FY26 was 11.33%, a decrease from 12.85% in Q3 FY25. This compression is attributed to higher variable and vendor-linked costs associated with servicing incremental volume and onboarding large enterprise accounts. Employee costs also surged by 44% YoY in Q3 FY26 to ₹22.87 crores due to 258 new executives and yearly increments. Management expects margins to normalize over the next two to three quarters as operations scale up.

Capital Allocation and Liquidity

Capex for the first nine months of FY26 was ₹26 crores, with a full-year target of approximately ₹32 crores, primarily for fleet expansion and replacement. The company maintains a healthy liquidity position, with cash and cash equivalents of around ₹120 crores. Provisions related to the new Labour Code amounted to ₹0.15 crores for the nine-month period.

Outlook and Growth Strategy

Management reiterated its long-term guidance of 15% to 20% revenue growth. PAT margins are expected to be between 8.5% to 10%, and EBITDA margins between 13% to 15% in the mid to long term. The company believes it is approaching an inflection point where operating leverage and scale efficiencies will reflect more meaningfully in margins, particularly when top-line revenue reaches ₹1,000-1,200 crores.

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