NewsSIS Limited Q4 FY26 Earnings: Record Revenue of ₹4,489 Crores, EBITDA Crosses ₹200 Crores MarkSIS Limited Q4 FY26 Earnings: Record Revenue of ₹4,489 Crores, EBITDA Crosses ₹200 Crores Mark
SIS Limited delivered a record Q4 FY26 with consolidated revenue of ₹4,489 crores (+31% YoY), EBITDA of ₹207 crores, and operating PAT of ₹105.5 crores, with ROCE crossing 16.5%. Management highlighted APS integration progress, Labour Code tailwinds, a ₹250 crores shareholder payout in FY26, and plans to pursue the cash business IPO within FY27 when market conditions improve.
*this image is generated using AI for illustrative purposes only.
SIS Limited delivered what management described as a milestone quarter and one of the best growth years in the last five to six years post-COVID, with Q4 FY26 marked by strong execution across all business segments. The company reported record consolidated quarterly revenue, record EBITDA, and record profit after tax, demonstrating sustained momentum across India Security, Facility Management, and International Security operations.
Record Financial Performance in Q4 FY26
The company posted consolidated quarterly revenue of ₹4,489 crores in Q4 FY26, representing a 31% year-on-year jump and 7.3% quarter-on-quarter growth. EBITDA crossed the psychological ₹200 crores mark for the first time, reaching ₹207 crores—a 25.6% increase on a year-on-year basis. The consolidated monthly revenue run rate now stands at ₹1,574 crores.
The following table summarises key consolidated financial metrics for Q4 FY26:
| Metric: | Q4 FY26 | YoY Change |
|---|---|---|
| Quarterly Revenue: | ₹4,489 crores | +31% |
| EBITDA: | ₹207 crores | +25.6% |
| EBITDA Margin: | 4.6% | — |
| Operating PAT: | ₹105.5 crores | — |
| Operating PAT Margin: | 2.4% | — |
| ROCE: | 16.5% | Up from 14.3% |
| DSO: | 63 days | Down 4 days QoQ |
| Monthly Revenue Run Rate: | ₹1,574 crores | — |
Return on capital employed improved to 16.5%, up from 14.3% a year ago, surpassing the company's stated threshold of 15%+. Days Sales Outstanding (DSO) improved to 63 days, down by 4 days from the previous quarter, representing one of the best DSO readings since 2023.
Segment-Wise Performance
All three business segments posted strong year-on-year growth in Q4 FY26. India Security reported its highest-ever quarterly revenue, while International Security also achieved a record quarterly revenue figure.
| Segment: | Q4 FY26 Revenue | YoY Growth | EBITDA Margin |
|---|---|---|---|
| India Security: | ₹1,925 crores | +34.2% | 5.1% (₹98.4 crores) |
| Facility Management: | ₹635 crores | +8.1% | 5.5% |
| International Security: | ₹1,950 crores | +36.9% | 3.8% |
India Security's revenue growth of 34.2% year-on-year was partly driven by the consolidation of the AP Securitas (APS) acquisition. Excluding APS, India Security's year-on-year growth stood at 11%. Management noted that SIS Security, excluding APS, delivered a 5.5% EBITDA margin in Q4, while APS delivered a 4.2% EBITDA margin, resulting in a blended margin of approximately 5.2% for the combined India Security business.
International Security's revenue was supported by seasonal events business in Australia, including the Australian Open and the Australian Grand Prix, which together contributed approximately AUD20 million—roughly ₹120 crores—in revenue during Q4. Management clarified that these are long-term, multi-year contracts tied to recurring annual events, and the revenue pattern is expected to repeat each Q4. Typical contracts signed in Australia and New Zealand are in the range of 3 to 5 years.
On the Facility Management segment, management attributed the marginal decline in employee count from 85,000 to 82,000 to the closure of certain contracts and surge work towards the end of Q4, clarifying that no significant contracts were lost and that the business remains on a steady growth trajectory with improving margins.
Exceptional Item and Accounting Adjustment
In the previous quarter (Q3 FY26), the company recorded a one-time exceptional charge of ₹290 crores related to the implementation of new Labour Code guidelines on gratuity and leave liabilities. During Q4 FY26, following a reassessment of the liability with auditors, the company reversed ₹38.8 crores of this liability, which was routed through Other Comprehensive Income (OCI) in accordance with applicable accounting standards.
Management confirmed that the reversal was an accounting adjustment with no material operational change, and that the outstanding liability has been reduced by ₹38.8 crores. Future incremental expenses arising from the new Labour Code are now factored into the rate structure for existing customers, while discussions with customers regarding past-period liabilities are ongoing. Management noted that past-period recoveries will be recognised through the profit and loss account only when the cash flow impact accrues.
APS Integration and Margin Convergence
Management described the acquisition of AP Securitas as a strategic transaction—the number one security company in India acquiring the number six or number seven player. The integration plan over the next approximately 18 months includes consolidation of branches, sharing of back-office services, procurement integration, and cross-selling of technology solutions. The 50 basis points margin gap between SIS Security (5.5%) and APS (4.2%) was identified as the primary synergy opportunity.
On the depreciation front, management noted that Q3 FY26 depreciation stood at ₹55 crores, rising to ₹70 crores in Q4 FY26—an increase of ₹15 crores. Of this, ₹10 crores is attributable to a new office lease signed in Australia (MSS lease), and the remaining ₹4 crores relates to fixed asset additions in India. On a full-year basis, depreciation increased from approximately ₹163 crores in FY25 to ₹215 crores in FY26, with the incremental change largely explained by new leases and APS consolidation under purchase price allocation accounting.
Capital Return and Shareholder Payouts
SIS returned a total of ₹250 crores to shareholders in FY26 through a combination of buyback and dividend, bringing the total payout ratio to 70%. Since its IPO, the company has returned approximately ₹600 crores in total to shareholders, comprising:
- ₹81 crores through dividend
- ₹270 crores through buybacks from FY22 to FY24
- ₹250 crores in FY26
Labour Codes and Industry Outlook
Management highlighted the implementation of new Labour Codes as a potential structural inflection point for the industry. Key implications cited include improvements in working capital dynamics through revised invoicing and payment cycles, reduction of compliance arbitrage that has historically kept the sector fragmented, and increased customer openness to technology-led solutions. Management also noted recent minimum wage revisions in several states—Haryana by 50%, Uttar Pradesh by approximately 28%, and Punjab and Uttarakhand above 15%—as a positive revenue driver, given that wage increases flow through directly to customer pricing under the company's contract structures.
Management further noted that globally, the security sector is a $300 billion industry as per Freedonia, with India being the fastest-growing and third-largest security market in the world. Despite being the domestic market leader, SIS currently holds approximately 5% market share in security—a figure management expects to grow materially as Labour Code enforcement reduces compliance arbitrage and consolidates the fragmented industry.
Cash Business IPO and Long-Term Aspirations
Management confirmed that the cash business IPO has been deferred owing to geopolitical conditions and IPO market dynamics, and is not delayed by any internal factors. The DRHP validity has been extended by SEBI to September 30, and management indicated that the IPO will be pursued within FY27 when market conditions are more conducive. The cash business was noted to have delivered solid numbers for FY26 with a positive outlook for FY27.
On a full-year FY26 basis, the company reported revenues of approximately ₹16,000 crores and a normalized profit after tax of approximately ₹390 crores. Management reiterated its long-term aspiration of sustaining above 15% revenue growth and maintaining above 15% return on equity, consistent with the company's performance since listing in FY18. Management also noted an aspiration to reach a ₹500 crores PAT mark, which it believes would place SIS among the top 100 listed companies in India by profit after tax, excluding BFSI majors.
Historical Stock Returns for SIS
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.13% | -7.00% | +23.52% | +11.00% | +12.67% | -3.30% |
How quickly can SIS close the 130 basis point EBITDA margin gap between APS and its core India Security business, and what specific integration milestones will signal successful synergy realization?
With Labour Code enforcement expected to reduce compliance arbitrage and consolidate India's fragmented security market, which smaller regional players are most vulnerable to acquisition or market share loss over the next 2-3 years?
Given that SIS holds only ~5% of India's security market despite being the domestic leader, what organic and inorganic growth levers could accelerate its path to the ₹500 crores PAT target?
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