1. At a Glance
TeamLease Services Ltd currently trades at ₹1,447, carrying a market capitalisation of ₹2,426 Cr—which is funny, because the company runs a payroll larger than some small countries. In Q3 FY26, the company reported ₹3,036.7 Cr revenue, EBITDA of ₹42.5 Cr, and PAT of ₹42.5 Cr, translating into an EPS of ~₹25 for the quarter. Sounds solid? The stock disagrees.
Despite Q3 PAT growth of 64% YoY, the share price is down ~36% over one year and ~14% over three years. This is one of those stocks where fundamentals go to the gym daily, but the stock price eats samosas.
Margins remain wafer-thin (OPM ~1.4%), but that’s the staffing business reality—high volume, low margin, zero glamour. The real story this quarter? Tax refund of ₹106 Cr, improving cash flows, stabilising earnings volatility, and a management reset underway.
Is this a boring compounder hiding under HR paperwork? Or a structural low-margin trap dressed as scale? Let’s find out.
2. Introduction
If Indian employment had a backend server, TeamLease would be running it—quietly, compliantly, and with zero drama until the tax department knocks.
Founded to formalise India’s chaotic labour market, TeamLease is essentially the HR department India outsources when it doesn’t want PF headaches. Over 3 lakh associates on payroll, presence across 7,500+ locations, and services spanning staffing, compliance, payroll, training, and apprenticeships.
Yet, despite this massive scale, TeamLease has always been a misunderstood stock. Investors see:
- Low margins
- No dividends
- Frequent management changes
- HR = boring
But what they often miss is that this is not a people business—it’s a compliance and working capital optimisation business. And in India, compliance never goes out of fashion.
Q3 FY26 was important because it showed:
- Revenue stability despite headcount rationalisation
- Profit growth without margin expansion (discipline > aggression)
- Management transition finally settling
So the big question: Is TeamLease entering a boring but predictable phase—or is it stuck in HR hell forever?
3. Business Model – WTF Do They Even Do?
Explaining
TeamLease is simple: they hire people so companies don’t have to.
But let’s break it down properly.
1) General Staffing & Allied Services (93% of revenue)
This is the bread, butter, and tiffin box. TeamLease hires employees on its own payroll and deploys them to clients. Clients pay TeamLease; TeamLease pays salaries, PF, ESI, compliance costs—and keeps a tiny spread.
- Headcount: ~2.99 lakh (Q3 FY25)
- Growth driver: India’s shift from informal to formal employment
- Risk: Wage inflation + compliance complexity
Margins are thin, but volumes are massive. Think Reliance Retail of HR—not pretty, but unavoidable.
2) Specialised Staffing (5% of revenue)
Includes IT staffing and telecom staffing. Higher margin, lower scale, more cyclical. This segment saw muted growth (~2% YoY) because IT hiring globally has been in a “let’s wait and watch” phase.
This is where acquisitions like Ikigai Enablers come in—Singapore + Middle East exposure, better billing rates, less PF drama.
3) Other HR Services (2% of revenue)
The interesting stuff:
- Compliance SaaS
- Payroll tech
- Degree Apprenticeship (DA) program
This segment grew ~21% YoY in 9M FY25 and is where future margin expansion could come from—if executed well.
So ask yourself: Is TeamLease just a manpower supplier, or slowly becoming an HR-tech + compliance platform?
4. Financials Overview
Quarterly Performance Table (Q3 FY26)
All figures in ₹ Crore
| Metric | Latest Qtr (Dec FY26) | YoY Qtr | Prev Qtr | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 3,013 | 2,921 | 3,032 | 3.1% | -0.6% |
| EBITDA | 42 | 35 | 38 | 20% | 10% |
| PAT | 42 | 28 | 28 | 64% | 50% |
| EPS (₹) | 24.88 | 16.95 | 16.41 | 47% | 52% |
