Sagility Limited

Sagility reported a robust 35.7% YoY revenue growth in INR terms for Q3 FY26, reaching ₹19,712 million. This performance was driven by a stronger-than-expected Open Enrollment (OE) season, particularly in the Medicare Advantage programs. Consequently, management raised its FY26 constant currency revenue growth guidance from 21%+ to 22.5%, while maintaining an organic growth target of 13.8%.

The acquisition of BroadPath has significantly altered Sagility's seasonal revenue profile. Historically, OE seasonal revenues accounted for 3% of annual revenue; this is now projected to reach 5.5% for FY26. While the US-based delivery of BroadPath work impacted margins by 220 bps due to a higher non-India revenue mix, it provided the necessary scale to handle the 'exceptional' activity levels seen this quarter.

Management is aggressively pushing 'Sagility Synchrony,' an integrated operating solution for Medicare Advantage that consolidates lifecycle functions. This shift toward outcome-based models allows the company to move away from FTE-based pricing and capture more value through technology-led transformation. The company has already deployed 32 distinct AI-driven use cases across 10 clients to support these initiatives.

To mitigate the risk of high client concentration (Top 10 at 84.6%), Sagility is focusing on the mid and small market segments. Seven of the 12 new logos won in the first nine months of FY26 came from this segment. While these clients start small, management expects them to be a key driver of long-term growth and diversification.

The company's balance sheet continues to strengthen, with a clear roadmap to be debt-free by FY27. Adjusted PAT grew 23% YoY to ₹3,229 million, aided by declining finance costs. Although DSO increased to 86 days due to high unbilled receivables from the 17% QoQ revenue surge, management expects this to normalize by the end of Q4.