AllDigi Tech Ltd Q2 FY26 – The ₹1,338-Crore Outsourcer That Automates Payrolls, Not Profits (Yet Still Pays 3.4% Dividend)
1. At a Glance
If you’ve ever been placed on hold by a customer-care executive who sounds suspiciously cheerful for 2 a.m., there’s a 27 percent chance the backend belonged to AllDigi Tech Ltd (earlier Allsec Technologies). This ₹1,338 crore mid-cap runs the less-glamorous but ultra-profitable backrooms of capitalism — managing HR, payroll, CX management, compliance, and tele-processes for the Fortune 100.
In Q2 FY26, the company clocked ₹147 crore revenue (+12.2 % YoY) and ₹17.6 crore PAT (+49.7 % YoY). That’s what happens when you automate other people’s salaries — you finally get to keep some of your own. The stock trades at ₹878, P/E 18.5, ROE 27 %, and throws a 3.4 % dividend yield — the corporate equivalent of a well-mannered overachiever who also brings sweets to the audit meeting.
2. Introduction
Outsourcing is India’s longest-running export sitcom — and AllDigi Tech has been in syndication since 1998. Started from a small Chennai facility answering overseas calls, it now handles 1 million + customer interactions per day across India, the U.S., and the Philippines.
Its transformation from Allsec Tech to AllDigi Tech mirrors the rebranding arc every IT firm dreams of — add “Digi”, slap a teal gradient, and suddenly you’re “future-ready”. Under parent Quess Corp (Fairfax-backed), it has grown into a twin-engine machine:
CXM (Customer Experience Management) with margins of ~38 %.
EXM (HR & Payroll Platforms) with ~15 % margins.
Together, they make corporations abroad look efficient and compliant — while the real genius sits in Chennai eating filter coffee and debugging payroll logic.
3. Business Model – WTF Do They Even Do?
Let’s decode the alphabet soup.
a) CXM – Customer Experience Management Think call-center 2.0: omnichannel voice, email, chat, analytics, credit-risk checks, and compliance for BFSI, healthcare, and e-commerce. 38 % segment margin — because “Press 1 for Profitability” actually works here.
b) EXM – Employee Experience Management Payroll, attendance, leave, reimbursements, PF, ESI, CLRA — basically every acronym HR hates. 15 % segment margin but stickiness near 100 %; once you automate payroll for 10,000 employees, nobody unplugs you voluntarily.
c) Global Presence Five delivery centers across India, Philippines, and U.S.; multilingual hubs servicing 12 languages. 4,000 FTEs handling 1 million contacts daily — meaning at any given second, someone, somewhere, is politely apologizing on behalf of a Fortune 100 client.
d) The Quess Umbrella Parent Quess Corp brings muscle — 600 enterprise clients and Fairfax money. Result: AllDigi gets steady projects, global credibility, and the occasional internal merger headache.
4. Financials Overview
Metric (₹ Cr)
Q2 FY26
Q2 FY25
Q1 FY26
YoY %
QoQ %
Revenue
147.4
131.4
144.0
12.2 %
2.4 %
EBITDA
36.0
30.8
37.0
16.9 %
-2.7 %
PAT
17.6
11.8
15.0
49.7 %
17.3 %
EPS (₹)
11.6
7.8
9.8
48.7 %
18.4 %
Commentary: Margins remain the star of the call center show. Operating margin near 24 %, PAT margin 12 %. Quarterly revenue per employee roughly ₹3.6 lakh — apparently empathy can be monetized.
5. Valuation Discussion – Fair Value Range
a) P/E Method FY25 EPS ≈ ₹47 → industry PE ≈ 34 × → theoretical ₹1,598. But small-cap discount & Quess control reduce that to 15–22 × → ₹705–₹1,035.
b) EV/EBITDA EV ₹1,319 Cr / EBITDA ₹153 Cr ≈ 8.6 ×. Peer average ≈ 12 ×. So EV range 8–12 × → ₹1,200–₹1,800 Cr → per share ₹790–₹1,180.
c) DCF Check Assume 13 % CAGR for 5 yrs, COC 10 %, terminal 3 %. → ₹850–₹1,100.
