Quess Corp

Quess Corp reported a robust Q3 FY26, achieving a consolidated revenue of INR 3,930 crores, reflecting a 3% quarter-on-quarter growth. The company reached a new quarterly milestone with an EBITDA of INR 80 crores, marking a 28% year-on-year and 4% sequential increase. EBITDA margins expanded to 2.03%, an improvement of 47 basis points year-on-year, driven by operating leverage and higher contribution from high-margin businesses. Adjusted PAT grew by 29% year-on-year to INR 62 crores, resulting in an adjusted EPS of INR 4.1 per share, while operating cash flow conversion remained strong at 92% of EBITDA.

The company announced strategic leadership changes, with Lohit Bhatia elevated to Chief Executive Officer effective January 1, 2026, and Neeraj Jain joining as Chief Financial Officer on December 3, 2025. This planned succession aims to sharpen execution while maintaining consistency in strategy, margin, cash flows, and governance. Management emphasized a continued focus on capital efficiency, liquidity discipline, and sustained strong cash generation, alongside investments in technology and growth initiatives.

The General Staffing segment demonstrated resilience, contributing INR 3,409 crores in revenue with an operating profit margin of INR 45 crores (1.3% EBITDA margin). Headcount remained broadly flat sequentially at 4,70,774 associates, with over 4,000 additions primarily from manufacturing and apprenticeship. The segment secured 71 new enterprise contracts in Q3, bringing the year-to-date total to 222. Operational execution remained strong, with collect and pay coverage at 76% and average DSO improving to 24 days, driven by tighter credit control.

Professional Staffing delivered an 'excellent quarter,' with revenue of INR 230 crores and EBITDA increasing to INR 29 crores, representing a 42% year-on-year growth. Its EBITDA margin expanded to an all-time high of 12.5%, driven by a disciplined focus on high-margin contracts and strong demand for GCCs. GCCs now account for 72% of the segment's 6,934 associates. The segment added 18 new logos in Q3, totaling 48 new logos for the financial year, with open mandates remaining steady at over 1,300.

The Overseas business continued its margin expansion trajectory, reporting INR 290 crores in revenue and EBITDA crossing the 7% mark for the first time, reaching INR 20 crores (a 26% year-on-year growth). The Middle East was a standout performer, delivering double-digit margins and nearly 100% collection efficiency. Malaysia saw strong traction with new contracts, while the Philippines achieved over 700 headcount with double-digit margins, contributing to a more balanced and diversified international portfolio.

The implementation of the Labour Code on November 21, 2025, resulted in a one-time^📎 exceptional item^📎 of INR 7 crores for gratuity provisioning. Management conducted over 830 client consultations and believes the code will drive greater formalization and consolidation, creating structural tailwinds. Despite a flattish Q3 headcount due to destocking and Labour Code pause, the company expects a steady headcount addition of 10,000-15,000 quarter-on-quarter in Q4 FY26, and aims for a net headcount addition exceeding 15,000 in Q4.

Quess Corp reiterated its ambition to scale to 1 million associates worldwide over the next 4 to 5 years, underpinned by high cash flow generation and a sustainable dividend policy (up to 75% payout ratio). The company is investing in an AI-enabled Hamara Jobs marketplace to strengthen its leadership in blue-collar hiring. Management also guided for a 20% Return on Equity (ROE) by the end of FY26 and a consistent 10% effective tax rate going forward^⏳.