TeamLease (TEAM)'s 1QFY26 revenue growth of 12% YoY was below our estimate of 16% YoY growth. General Staffing grew by 2% QoQ, while Specialized Staffing grew 12% QoQ. HR services declined 41% QoQ. EBITDA margin of 1.1% was in line with our expectation. EBITDA declined by 35% QoQ. Adj. PAT at INR250m was up 29% YoY/down 34% QoQ. The company's revenue/EBITDA/PAT grew 12.1%/38%/29% YoY in 1QFY26. We expect revenue/EBITDA/PAT to grow 14.5%/36%/66% YoY in 2QFY26. We reiterate our BUY rating with a TP of INR2,200.
OutlookWe keep our estimates largely unchanged. We reiterate our BUY rating with a TP of INR2,200 (20x FY27E EPS).
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