Event Participants
Executives
5 Kapil Joshi, Kundan K Lal, Lohit Bhatia, Neeraj Jain, Nitin Dave
Analysts
6 Amit Chandra, Anant Mundra, Dipesh Mehta, Sankaranarayanan S, Shivang, Zakin Nasser
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Consolidated Revenue | ₹4,182 crores | +15% YoY, +7% QoQ; broad-based growth across all three core segments |
| Consolidated EBITDA | ₹85 crores | +21% YoY, -2% QoQ; margin 2.02% (+11 bps YoY, -20 bps QoQ); QoQ dip from merit cycle and Labor Code pass-through |
| Consolidated PAT | ₹82 crores | +61% YoY, +28% QoQ; boosted by ₹261 cr tax refund (incl. ₹22 cr interest) |
| Diluted EPS | ₹5.5 | +61% YoY |
| PBT | ₹86 crores | +64% YoY, +28% QoQ |
| Other Income | ₹26 crores | Vs ₹6 cr Q4 FY26; driven by ₹261 cr income tax refund for prior years |
| Total Headcount | ~482,214 associates | +4.5% YoY; reinforces position as India's largest domestic staffing platform |
| Net Cash Position | Zero debt | Healthy net cash as of June 2026; disciplined balance sheet |
| Final Dividend | ₹3 per share | Approved for FY26; AGM scheduled August 25, 2026 |
| General Staffing Revenue | ₹3,596 crores | +15% YoY, +8% QoQ; includes ₹176 cr one-time Labor Code impact |
| General Staffing EBITDA | ₹51 crores | +12% YoY, -2% QoQ; merit cycle impact; ex-Labor Code margin ~1.5% |
| General Staffing Headcount | 469,000 | Net addition of 3,800+; 86 new contracts; 37,000+ open mandates |
| General Staffing DSO | 15 days AR (28 days incl. UBR) | Tight collections discipline maintained |
| Professional Staffing Revenue | ₹252 crores | +3% YoY, +9% QoQ; GCC-led growth |
| Professional Staffing EBITDA | ₹28 crores | +12% YoY; margin ~11%; gross margin to EBITDA conversion >50% |
| Professional Staffing Headcount | 7,129 | +7% YoY; GCC contributes 71% headcount, 68% revenue |
| Professional Staffing Open Mandates | 1,100+ roles | 36 new contracts added; primarily niche/high-value roles |
| Overseas Revenue | ₹333 crores | +17% YoY, flat QoQ; diversified across geographies |
| Overseas EBITDA | ₹21 crores | +17% YoY; margin ~6.2%; 37 new logos added |
| Overseas Revenue Mix | 7% of consolidated | 93% INR-denominated; target 20-25% from higher-margin dollar-linked businesses in 3-4 years |
Geographic & Segment Commentary
General Staffing: Revenue grew 15% YoY to ₹3,596 cr led by Manufacturing, CRT verticals; BFSI saw marginal decline due to regulatory headwinds on outsourcing. Added 86 new contracts and 3,800+ net headcount. Manufacturing commands higher PAPM (₹800-1,100 vs ₹600-700) and gross margins (5-6% vs 2-3% in Consumer). Fixed-variable contract mix at 70-30; 38% of new contracts variable. Sourcing strength: 65 offices, 6,464 pin codes, 41% associates in Tier-3+ cities, 1,400 recruiters, ~46,000 gross additions in Q1 (vs ~30,000 YoY).
Professional Staffing: Sustained profitable GCC-led growth with revenue at ₹252 cr (+3% YoY, +9% QoQ) and EBITDA margin ~11%. GCC accounts for 71% headcount, 68% revenue; 36 new contracts, 1,100+ open mandates in niche roles. Gross-to-EBITDA conversion >50% despite annual merit cycle impact. Target: ₹30 cr quarterly EBITDA run rate; margin guidance 11-12%. India has 2,407 GCCs; Quess captures ~10% with 250-300 new GCCs annually.
Overseas Business: Consistent double-digit growth across geographies; revenue ₹333 cr (+17% YoY), EBITDA ₹21 cr (+17% YoY), margin 6.2%. Malaysia +55% YoY (873 headcount, 4.1% margin), Middle East +27% revenue/+18% EBITDA (12% margin), Philippines +17% revenue (10% net margin), Singapore added 17 contracts. 37 new logos added. Margin guidance 6.5-7% as markets mature.
Company-Specific & Strategic Commentary
Quess 2.0 - Dollar-Denominated Higher Margin Growth: Building partner-led, capital-light talent corridors across five segments (Healthcare, Technology, MEP & Civil, Hospitality & Allied, Finance & Professional) targeting Japan (signed/executing), Nordics (advanced discussions), Israel (discussions), North America (early exploration). Aim: 20-25% revenue from higher-margin businesses in 3-4 years vs current 7% overseas. Leverages India's demographic dividend vs supply shortages in mature markets.
Labor Code Implementation: One-time ₹176 cr revenue impact in Q1 (pass-through, no EBITDA effect) covering 68% of customers. Full coverage expected by end Q2/early Q3; remaining liability <₹170 cr. Recurring liability minimal going forward. No profitability impact - pure pass-through with corresponding UBR booking.
Japan Corridor Partnership: Signed with listed Japanese HR technology firm (not staffing). Partner provides local relationships to introduce Quess for talent/technology/infrastructure fulfillment as Japanese GCCs expand to India. Only ~5% of India's 2,407 GCCs from Japanese ecosystem currently.
ELI Scheme: No benefits accrued or received yet; will disclose when materialized.
M&A Strategy: No active M&A; focusing on partnership model. Will evaluate value-accretive opportunities at right valuation.
Great Place to Work & Certifications: Certified 7th consecutive year (ranked 19th in India's Best Workplaces 2025); certified in Singapore (3rd year) and UAE (first time); CMMI Level 3; ranked 188th Fortune 500, 175th ET 500; Leadership Factory for India 2026-28.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| General Staffing Headcount Growth | 10-11% annually (40,000-50,000 net additions) | Q1 added ~5,000; team geared for festive season; 37,000 open mandates + healthy pipeline |
| Professional Staffing EBITDA Margin | 11-12% | Exited FY26 >12%; merit cycle impacts Q1; target ₹30 cr quarterly EBITDA run rate |
| Overseas EBITDA Margin | 6.5-7% | Currently 6.2%; two markets in double digits; improvement as portfolio matures |
| Quess 2.0 Revenue Mix | 20-25% from higher-margin dollar-linked businesses in 3-4 years | From current 7% overseas; partner-led capital-light model across 5 corridors |
| Labor Code Coverage | 100% by end Q2/early Q3 FY27 | 68% covered in Q1; remaining liability <₹170 cr |
| Long-term Headcount Target | 1 million associates by 2030 | Current ~482k; need ~125k more for world #1 (currently ranked 3rd/4th globally) |
| Profit Pool Mix | Shift from 50:50 (GS:Professional+Overseas) to 35:65 in 3-4 years | GS was 65-68% of profit pool 18 months ago; now 50%; target higher-margin mix |
Risks & Constraints
| Risk | Context |
|---|---|
| BFSI Regulatory Headwinds | RBI restrictions on outsourcing in core banking limiting growth; NBFC/fintech opportunities exist but smaller scale (hundreds per client); recovery timeline uncertain |
| Labor Code Implementation Uncertainty | Final liability depends on customer choice (FTE vs permanent model); exact recurring revenue impact unknown until all customers confirm by Q2/Q3 |
| Quess 2.0 Execution Risk | Early stage (90 days); margins unproven until MSAs signed and delivery begins; dependent on FTA progress (Europe 2027, US TBD) and skilled mobility chapters |
| GCC Concentration Risk | 68% Professional Staffing revenue from GCCs; maturation of individual GCCs could slow hiring; offset by new GCC formation (250-300/year) and low capture rate (~10%) |
| Manufacturing Staffing Complexity | Higher margins but requires intense sourcing, infrastructure, technology; execution risk in scaling while maintaining quality |
| Visa/Immigration Policy Risk | Overseas corridors depend on government-to-government FTAs and skilled mobility agreements; geopolitical border issues could delay corridor openings |
Q&A Highlights
General Staffing Growth & Margins
- Question: BFSI laggard vs Manufacturing strength; fixed vs variable markup mix; margin trajectory (Amit Chandra, HDFC Securities)
- Answer: Manufacturing + CRT driving growth; BFSI split - core banking regulatory headwinds, NBFC/fintech opportunities large but smaller scale. Fixed-variable 70-30; 38% new contracts variable. Manufacturing PAPM ₹800-1,100 vs ₹600-700 normal; gross margin 5-6% vs 2-3% Consumer. Ex-Labor Code GS margin ~1.5%; AI/platform investments to yield results this year. (Lohit Bhatia)
Professional Staffing GCC Outlook & Margins
- Question: GCC hiring normalization signs; shift to IT services hiring; margin sustainability at ₹30 cr EBITDA target (Amit Chandra, HDFC Securities)
- Answer: 68% revenue/72% headcount from GCCs; captured only 10% of 2,407 GCCs; 250-300 new GCCs annually; Japan corridor live. Margin guidance 11-12% maintained; exited FY26 >12%; gross-to-EBITDA conversion >50%. (Lohit Bhatia)
1 Million Associates by 2030 Strategy
- Question: Trajectory by geography/segment; M&A role (Zakin Nasser, Nasser Investments)
- Answer: North Star 1 million; currently ~482k, need ~125k for world #1. Not building operating companies abroad - partner-led capital-light corridors (Japan, Nordics, Israel, UK/Germany, US/Canada) for reverse skilled mobility. India's demographic dividend positive for 18 years. No M&A currently; partnerships only. (Loh