ICICI Securitie`s research report on Sagility India
Sagility India reported 5.8% QoQ USD revenue growth (organic growth at 0.7%), slightly ahead of I-Sec estimate in Q4FY25. It met its guidance of delivering mid-teens growth in FY25 with 15% YoY USD print. Q4 traction was led by: 1) Open enrolment based positive seasonality for H2, 2) 2-months’ worth of revenue from BroadPath, 3) cross-selling traction from BroadPath. It has shown good execution with reduction in borrowing to INR 8.17bn in FY25.
Outlook
Adjusted margin at 25.7% in FY25 was up 143bps. Client count moved to 75 in FY25 from 44 in FY24. Status quo has been maintained in FY26 revenue growth and margin guidance, which gives confidence amid apprehensions of Medicaid spending cuts by the US government. Maintain BUY with a revised TP of INR 60 (from INR 56) based on an unchanged 1-year forward P/E of 26x.
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