Birlasoft Q2 Results: Profit Up 37.5%, Margins Slip (Oct 29, 2026)

Birlasoft Q2 results sent the stock sharply higher on Thursday, October 29. Consolidated profit after tax for the September quarter of FY27 rose 37.5% year-on-year to ₹159.6 crore, and the board declared an interim dividend of ₹3 a share. The catch sits one line lower: operating margins slipped, and brokerages are far from agreeing on what comes next.

The move came early. ET Now reported the stock at ₹336.40 at 9:40 am, up 9.8% from the previous close of ₹306.10, which put it among the top 10 gainers on the NSE that morning.

Birlasoft Q2 results: the key numbers

Here is how the quarter looks, based on figures reported by Capital Market and ET Now:

• Net profit: ₹159.6 crore, up 37.5% from about ₹116 crore in Q2 FY26, but down 0.8% from ₹161 crore in Q1 FY27.
• Revenue from operations: ₹1,416.2 crore, up 6.6% from ₹1,328.9 crore a year ago and 2.7% higher than Q1’s ₹1,379.4 crore.
• EBITDA: ₹215.3 crore, up just 1% year-on-year and down 3.3% from the previous quarter.
• EBITDA margin: 15.2%, against 16% a year earlier and 16.1% in Q1.
• EBIT margin: 13.4%, down from 14.5% a year ago, as EBIT dipped 1.4% to ₹190.3 crore (per ET Now).

So profit growth ran far ahead of operating profit. Profit before tax rose only 7.1% from the year-ago quarter, which tells us the 37.5% jump in the bottom line was not driven by the core business getting more profitable.

Where the growth came from

Revenue grew 2.1% quarter-on-quarter in dollar and constant-currency terms, CFO Chandrasekar Thyagarajan said. Manufacturing led with 5.2% sequential growth in dollar terms, BFSI added 3.6% and lifesciences and services 2.1%. Energy and utilities went the other way.

Costs explain the margin squeeze. Employee benefit expenses rose 8.19% to ₹861.6 crore, ahead of revenue growth, and the CFO pointed to compensation increases and continued investment in sales and domain capabilities.

Deal flow is the number to watch. Total contract value signed in the quarter was US$116 million, of which only US$47 million came from new wins and US$69 million from renewals. For the first half, deal wins TCV rose 15% to US$285 million.

The balance sheet stays clean. Cash and equivalents stood at ₹2,879.1 crore at the end of September, days sales outstanding improved to 51 days from 55, and attrition eased to 11.1% from 11.7%.

Brokerages split down the middle

The calls after the results were all over the place, as compiled by ET Now:

• DAM Capital upgraded the stock to Buy from Neutral with a ₹370 target, expecting a strong second-half recovery.
• Emkay kept Add with a ₹350 target and nudged up its FY27-FY29 EPS estimates by 0.6-1.6%.
• Nuvama stayed at Hold but raised its target to ₹300 from ₹280, flagging softer deal wins.
• Nirmal Bang kept Hold with a ₹317 target, calling the order book the key weakness.

Notice that two of those four targets sit below where the stock traded on Thursday morning.

What it means for investors

The quarter shows a mid-tier IT company that is growing again, but slowly, and paying for it in margins. CEO Angan Guha himself said near-term performance would reflect macro conditions and seasonality. With new deal wins at just US$47 million, we think the second-half recovery that bulls are counting on needs to show up in signings first.

If you are new to reading results like these, our guide on how to analyse quarterly results of a company explains why profit and operating profit can tell different stories. For another margin-led quarter from the same day, see our take on Symphony’s Q2 results.

Disclaimer: This article is for information and education only and is not investment advice. Please do your own research or consult a SEBI-registered adviser before making any investment decision.