Summary
Ksolves India Limited - Q3 FY26 Earnings Call Summary Tuesday, January 20, 2026
Event Participants
Executives 4 Darpan Audichya (Head, Business Transformation and Consulting), Manish Gurnani (CTO), Ratan Srivastava (CMD), Umang Soni (CFO)
Analysts 4 Ankur Kumar (Alpha Capital), Apoorv (Individual Investor), Kaustav Bubna (BMSPL Capital), Raghav (KamayaKya Wealth Management), Rajesh Jain (RK Capital)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from Operations | ₹42.3 crores | +12.2% YoY, +6.6% QoQ; driven by core services execution and ramp-up of large deal wins. |
| 9M FY26 Revenue | ₹119.6 crores | +14.9% YoY; consistent demand in ERP, Cloud, and Data Engineering. |
| EBITDA Margin | 32.4% | +194 bps QoQ; improvement driven by operating leverage and efficiency despite year-long investment drag. |
| 9M FY26 EBITDA Margin | 29.9% | -790 bps YoY; decline due to leadership hiring, branding events, and digital marketing spend. |
| Profit After Tax (PAT) | ₹9.8 crores | 23.2% margin; PAT margin for 9M FY26 dropped to 20.6% from 27.3% YoY. |
| EPS | ₹4.13 | Increased from ₹3.5 per share in Q3 FY25. |
| Cash & Equivalents | ₹13 crores | Company remains net debt-free with disciplined capital allocation. |
| Client Concentration | 40% (Top 5) | Top 10 clients contribute 54% of revenue; 15-20 clients drive over 60% of total revenue. |
| Dividend | ₹5 per share | Third interim dividend declared; total FY26 dividend stands at ₹11 per share. |
Geographic & Segment Commentary
- Overseas Market: Approximately 78% of total revenue is derived from global markets, with 80-85% of Odoo-specific revenue coming from outside India. Management sees strong visibility in the U.S., UAE, and Australia, noting that international deals offer higher sizes and longer tenures.
- IT Services: This segment remains the primary backbone, contributing 97.4% of 9M FY26 revenue. Key growth drivers include ERP, Salesforce, Data Engineering, and AI, with a transition toward fixed-cost models to capture productivity gains.
- Product Segment: Contributed 2.6% of 9M FY26 revenue. While currently small, management is focused on the Data Flow Manager (DFM) and is targeting long-term growth by solving efficiency gaps in open-source Apache NiFi.
Company-Specific & Strategic Commentary
- AI Integration: Ksolves is embedding “Agentic AI” and GenAI across existing ERP and analytics workflows rather than as standalone products. DFM 2.0 with Agentic AI is being launched to automate complex data operations, developed entirely in-house using third-party LLMs.
- International Expansion: The Board approved a wholly owned subsidiary in Australia to capitalize on regional growth. This follows a period of heavy investment in global branding and events to build a long-term deal pipeline.
- Operational Efficiency: Transitioning from Time & Material (T&M) to fixed-cost projects allows the company to retain benefits from AI-driven productivity gains. Internal AI usage is also helping mitigate the “supply-side” challenge of finding high-quality resources.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | 20% YoY for FY26 | Management is confident of beating this target based on current pipeline and Q4 visibility. |
| EBITDA Margin | ~30% Medium-term | Expected to normalize as heavy “event-based” marketing spend reduces and utilization remains healthy. |
| Labor Code Impact | Non-material in Q4 | Gratuity expenses will rise due to the new code, but will be absorbed within the guided EBITDA margin. |
Risks & Constraints
| Risk | Context |
|---|---|
| Marketing ROI | Management admitted some recent strategic investments in large-scale events and marketing did not yield expected outcomes, leading to margin compression. |
| Product Adoption | DFM has a long conversion cycle (6+ months) as it impacts critical business data; management noted success relies heavily on “luck” and reaching high-level decision-makers. |
| Resource Supply | The primary constraint is not demand but the supply of “good resources” in niche technologies, though AI is being used to bridge this gap. |
Q&A Highlights
Core Services & Demand
- Question: What is the demand outlook for FY27 and the impact of US volatility? (Ankur Kumar)
- Answer: Demand is not a problem for niche technologies; the company is focused on the supply side. US macro issues haven’t materially affected the offshore delivery model (Ratan Srivastava).
Product (DFM) Deep-Dive
- Question: Who are the peers for DFM and is it built on open source? (Raghav)
- Answer: DFM is built on Apache NiFi. The primary peer is Cloudera, but DFM is 7x-8x more cost-effective with more features (Manish Gurnani).
- Question: What is the revenue model for DFM? (Rajesh Jain)
- Answer: It is recurring. Current ticket sizes range from $16,000 to $50,000 as they are in the early “discounted” phase to build word-of-mouth (Ratan Srivastava).
Margin Recovery
- Question: Why did EBITDA margins dip YoY despite the QoQ recovery? (Raghav)
- Answer: 9M FY26 saw heavy investment in 10+ global events, leadership hiring, and ESOPs. Moving forward, the company will attend events as visitors rather than expensive exhibitors (Umang Soni).
Client Concentration & Cross-selling
- Question: How successful is the company at cross-selling services? (Rajesh Jain)
- Answer: It is “huge.” Clients often start with Odoo or Salesforce and expand into Big Data or AI; one top-5 client grew from 4-5 resources to ₹25-28 crores annually (Ratan Srivastava).
Key Takeaway
Ksolves India Limited delivered a steady Q3 FY26 with 6.6% QoQ revenue growth and a margin recovery to 32.4%, following a period of intensive strategic investment. The company is successfully transitioning toward a 78% overseas revenue mix, leveraging its “Great Place to Work” status to manage resource supply in niche areas like ERP, Salesforce, and Big Data. Strategically, Ksolves is moving beyond simple IT services by embedding Agentic AI into its workflows and scaling its proprietary Data Flow Manager (DFM) product, which offers significant cost efficiencies over global peers. While 9M FY26 margins were impacted by aggressive branding spend, management expects normalization toward 30% as these investments mature. Ksolves remains confident in achieving 20% YoY revenue growth for FY26, supported by a healthy pipeline and a strong net debt-free balance sheet.
Want more insights like this?
Subscribe to get deep dives delivered to your inbox.
More Earnings Summaries
Explore more Q3 FY26 earnings call analyses: