eClerx Q2FY26 Concall Decoded: When GenAI Meets Margin Discipline(Because even AI couldn’t predict a 400 bps margin jump.)
1. Opening Hook
While most IT firms were still updating their GenAI decks, eClerx quietly printed a ₹1,832 crore PAT — and decided to buy back ₹300 crore worth of its own brilliance. The CFO called it “strong performance aided by FX,” which is corporate for thank the dollar gods.
Somehow, while Fashion & Luxury clients mourned in Paris and BFSI bankers fought regulatory fatigue, eClerx built new muscle in Cairo and cash flow so good it converted at 105% of EBITDA.
And yes — management insists Q3 “won’t be as strong” only because the rupee dared to behave. Strap in; it gets spicier. 😏
2. At a Glance
Revenue up 7.5% QoQ (₹10,049 mn): CFO swears it’s not rupee yoga; just steady deal wins.
EBITDA ₹2,983 mn (28.8% margin): FX gave a 200 bps back massage, utilization did the rest.
PAT ₹1,832 mn (+29% QoQ): Profit didn’t jog — it sprinted.
Deal Wins $46 mn: Clients must’ve loved the Cairo accent.
Top 10 client concentration ↓ 0.5%: Diversification without drama.
3. Management’s Key Commentary
Kapil Jain (MD & CEO):
“Operating revenue was $115.5 million, up 5.7% sequentially. Margins also came in stronger.” (Translation: Surprise! Even the CFO didn’t see that coming.)
“Growth was exceptionally strong in emerging business due to go-live for a couple of clients in F&A.” (Translation: The small clients are finally paying bills.)
“Fashion & Luxury remains under pressure; we think the downturn is bottoming out.” (Translation: Paris is broke, but we’ll pretend optimism is strategy.)
“Egypt is shaping up well. Top quartile performance in four months.” (Translation: Cairo’s cheaper, smarter, and less fussy than London.)
“We’re having new conversations on agentic AI.” (Translation: Every client wants AI, no one knows what to do with it.) 😏
Srinivasan Nadadhur (CFO):
“Constant currency revenue up 5.4% QoQ, 16.3% YoY. EBITDA margin expanded 400 bps.” (Translation: Currency tailwinds — the best HR policy ever.)
“EBITDA conversion at 105%. DSO improved to 76 days.” (Translation: Clients actually paid on time — a first in Indian IT folklore.)
“Attrition is 20% after pay hikes.” (Translation: The ‘thank you bonus’ works — for quitting.)
