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    Hinduja Global Solutions Q1 FY27 earnings call

    HGS
    Services·10 Aug 2026
    Management Summary

    Hinduja Global Solutions Limited reported a challenging Q1 FY27 with revenue from operations at ₹1,050.4 crores and EBITDA margins at 9.7%, impacted by ramp-up costs for new contracts and planned phase-out of legacy engagements. Despite the margin pressure, the company demonstrated strong business momentum with 19 new CX/digital logos and 8 HRO clients, alongside strategic expansion into the MENA region and the successful launch of 'Project Ganga' in its Media business. Management remains cautiously optimistic, expecting gradual improvement in growth and margins through the year as new engagements mature and AI-led transformations commercialize.

    Highlights

    5

    • Added 19 new logos across CX and digital services, and 8 clients in HRO and payroll processing, demonstrating continued client confidence.

    • Incorporated HGS MENA IT Consulting LLC in Dubai to build technology and consulting capabilities and support expansion.

    • Broadband business (CelerityX) saw a strong start to the fiscal, adding new prestigious logos and securing repeat orders.

    • Successfully launched 'Project Ganga' in Uttar Pradesh, a significant digital inclusion and social upliftment initiative.

    • High-speed broadband adoption increased from 11% to 15% on an expanding subscriber base, with customers opting for higher base plans.

    Concerns

    4

    • Revenue from operations was ₹1,050.4 crores, moderating around 3.2% sequentially and marginally lower by 0.6% YoY.

    • EBITDA margin declined to 9.7% from 15.7% in the previous quarter and 13.5% year-on-year, primarily due to ramp-up and training costs for new business.

    • Profit before tax (before exceptional item) was negative ₹52.8 crores, compared to a positive ₹14.1 crores in the previous quarter.

    • Total PAT was negative ₹66.3 crores, compared to negative ₹13.6 crores in the previous quarter and positive ₹11.2 crores in the year-ago quarter (which included discontinued operations gain).

    Key financials

    Single quarter

    05 metrics
    1. 01Revenue from Operations₹1,050.4 Cr-0.6%YoY
    2. 02Total Income₹1,201.2 Cr+1.2%YoY
    3. 03EBITDA₹116.3 Cr-27.4%YoY
    4. 04EBITDA Margin9.7%-28.1%YoY
    5. 05PAT₹-66.3 Cr-7.1%YoY

    Segment breakdown

    Revenue by Source
    54% CX Services46% Digital and Media Services
    Revenue by Vertical
    46% Tech, Media and Telecom19% CG and Retail17% BFSI12% Public Sector3% Health and Life Sciences4% Others
    List

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Debt

    Gross ₹1,279 crores · Net ₹-5,326 crores

    Liquidity

    Cash ₹6,605 crores

    Liquidity remains solid. Gearing ratios are comfortable and working capital metrics are stable. Collection discipline continues to hold, and we are funding our growth initiatives including "Project Ganga" primarily through internal accruals.

    What to watch in Q2 FY27

    5

    Project Ganga KPIs and operational progress

    next quarter
    Current2000 applications received, 500 applicants trained as of Aug 4, 2026
    TargetSpecific KPIs on trained individuals, loans received, networks rolled out, and customers onboarded

    Why it matters

    Project Ganga is a significant initiative for the Media business, and its operational success will be key to future growth and social impact.

    And I will in the next meeting and the next quarter that we have, I will share with you KPIs, Key Performance Indices in terms of how many people have been not just trained, but also how many people their network have received their loan from the CM YUVA Scheme, how many people have been have rolled out their networks and how many customers they have onboarded.

    Risks & concerns

    3
    RiskSeverity

    Macroeconomic uncertainties and client prudence

    Macro uncertainties and client prudence may persist in the near term, impacting business decisions and growth. — Management acknowledged

    medium

    Digital television business headwinds

    Significant headwinds impacting digital television or linear TV business, requiring continued mitigation strategies and cost optimization. — Management acknowledged

    medium

    Client readiness for AI adoption

    Not all customers are fully ready with data and governance for AI production deployments, potentially slowing the transition from pilots. — Management acknowledged

    low

    Q&A highlights

    8

    “So, in terms of Project Ganga, we are the enabler and the knowledge partner. So, from our perspective, obviously, our role expands right up to handholding and commissioning the partner. Your point is valid in terms of what would be the broadband pricing, what would be the margins and how the business would operate. Let me put it to you slightly differently. The idea is that because of the scale of over 2 million homes to be connected, there remains enough of traction.”

    Analyst questioned the profitability of Project Ganga, which management clarified is not a negative cash flow play due to in-house resources and capabilities, focusing on service quality and scale rather than direct profit from ISP services.

    asked by Ankit Jain

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance Overview

    Hinduja Global Solutions reported Q1 FY27 revenue from operations at ₹1,050.4 crores, a marginal decrease of 0.6% year-on-year and a sequential moderation of 3.2%. Total income was ₹1,201.2 crores, up 1.2% year-on-year. EBITDA stood at ₹116.3 crores, resulting in an EBITDA margin of 9.7%, a significant decline from 15.7% in the previous quarter and 13.5% year-on-year. This margin compression was attributed to ramp-up and training costs associated with new business and the planned phase-out of legacy contracts.

    02

    Strategic Focus on AI-led Transformation and Digital Modernization

    The company is actively focusing on execution, capability building, and positioning for its next phase of growth, emphasizing AI-led transformation, digital modernization, platform services, and intelligent operations. Management noted a shift towards contracts with higher technology content, more offshore delivery, and outcome-based commercials. This strategic pivot is expected to drive sustainable growth and improved margins in the long term, despite immediate impacts from ramp-up costs.

    03

    Business Highlights and New Client Acquisitions

    HGS added 19 new logos across CX and digital services and 8 clients in HRO and payroll processing during the quarter, reflecting continued client confidence. The pipeline remains strong in areas such as agentic AI, process automation, contact center, digital modernization, and platform services. An important development was the incorporation of HGS MENA IT Consulting LLC in Dubai, aimed at building technology and consulting capabilities and supporting regional expansion.

    04

    Media Business: Project Ganga and Broadband Growth

    The Media business, particularly the broadband segment, had a strong start to the fiscal year. 'Project Ganga', a Government Assisted Network for Growth and Advancement, was launched on June 9, 2026, in Uttar Pradesh. This initiative aims to empower youth by developing 8,000 to 10,000 independent digital service providers, connecting over 2 million households with high-speed broadband. CelerityX, the enterprise business, continued to add and renew logos, with high-speed broadband adoption increasing from 11% to 15% of the subscriber base.

    05

    Financial Position and Liquidity

    The company maintains a strong balance sheet with total assets of ₹11,474 crores as of June 2026. Gross treasury and cash surplus stood at ₹6,605 crores against total borrowings of ₹1,279 crores, resulting in a net treasury and cash surplus of ₹5,326 crores. This strong liquidity position is being utilized to fund growth initiatives, including 'Project Ganga', primarily through internal accruals, without significant reliance on external debt.

    06

    Digital Television Business Challenges

    The digital television business continues to face significant industry-wide headwinds. HGS is actively implementing mitigation strategies, including bundling broadband with DTV, rolling out IPTV, and focusing on cost optimization. Management emphasized the ongoing effort to make the business more robust through innovation and efficiency measures.

    This is an AI-generated summary of a publicly available earnings call transcript.