Zensar Technologies published its unaudited consolidated financial results for the quarter ended June 30, 2026, in Financial Express and Loksatta on July 31, 2026, complying with Regulation 47 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Pune-based IT services firm reported an 8.9% year-on-year revenue increase to ₹15,083 million ($159.5 million), driven by strong performance in the Banking and Financial Services (BFSI) vertical. Net profit remained stable at ₹1,838 million ($19.4 million), up 1% from ₹1,820 million in Q1FY26, while EBITDA margin contracted to 14.6%, down 150 basis points sequentially due to transition costs from large new deals.

The results were approved by the Board of Directors at its meeting held on July 29, 2026, and reviewed by statutory auditors S R B C & Co LLP pursuant to Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company also disclosed standalone revenue from operations of ₹7,632 million for the quarter, compared to ₹7,418 million in the prior quarter.

Key Financial Metrics

The following table summarises the key financial performance indicators for the quarter:

In constant currency terms, revenue grew by 1.1% sequentially but declined by 2.0% year-on-year, reflecting foreign exchange fluctuations. The company maintained a strong balance sheet with net cash and cash equivalents of $317.5 million, a 0.6% increase year-on-year. Profit after tax stood at 12.2% of revenue, a sequential decrease of 220 basis points.

Segment Performance

Banking and Financial Services (BFSI) emerged as the primary growth engine, contributing 48.8% of total revenue. The vertical registered an 8.3% quarter-on-quarter and 14.7% year-on-year growth in constant currency terms. Conversely, other verticals faced headwinds. Telecommunication, Media and Technology (TMT) revenue declined by 28.0% year-on-year in constant currency, while Healthcare and Life Sciences (HLS) fell by 8.7%. Manufacturing and Consumer Services (MCS) also saw a 3.4% year-on-year decline.

Geographically, the US region accounted for 66.2% of revenue, growing 2.5% sequentially but declining 3.7% year-on-year in constant currency. Europe contributed 21.5% of revenue, with a 3.0% year-on-year growth in constant currency despite a 1.4% sequential decline. Africa's contribution stood at 12.3%, showing minimal change with a 0.8% year-on-year decline.

What the Numbers Show

A notable divergence exists between top-line growth and margin contraction. While revenue grew sequentially, EBITDA dropped by 8.6% to $23.3 million. Management attributed this to a 200-basis point impact from large deal transitions and higher direct costs for travel, visas, and training, suggesting that recent wins — particularly in AI-driven projects — are currently cost-intensive during the mobilization phase. Client concentration remains stable, with the top 20 clients contributing 56.6% of revenue, slightly up from 56.0% in Q4FY26. The number of clients generating over $10 million in revenue increased to 19 from 15 in the previous quarter, indicating deeper engagement with key accounts. Operating expenses as a percentage of revenue improved to 15.1% from 16.5% in Q4FY26, demonstrating some operational leverage despite the margin pressure from direct costs.

Strategic Wins and Outlook

Zensar secured several significant AI-focused wins in Q1FY27, including grants lifecycle modernization for a leading US property insurer and payments optimization for a global energy leader. CEO Manish Tandon highlighted broad-based volume gains despite a challenging macroeconomic environment characterized by prolonged decision cycles. CFO Pulkit Bhandari noted that these large deals strengthen positioning for high-value strategic programs.

The company also reported improved human capital metrics, with total headcount rising to 11,342 from 10,779 in FY26. Voluntary attrition decreased to 9.6% from 9.8% in the previous period, and utilization rates improved to 85.1%. Zensar was recognized as a Leader in Everest Group's Guidewire Services PEAK Matrix Assessment 2026 and ranked #1 in IT Services in Great Place to Work's 'Best Companies to Work For 2026'.

The company has created Zensar Employees Welfare Trust (the 'ESOP Trust') for providing share-based payments under Employee Stock Option Scheme 2025. As at June 30, 2026, ESOP Trust has acquired 781,257 Equity shares from the open market which are treated as Treasury Shares by the Company. No further impact from New Labour Codes was recognised during the quarter ended June 30, 2026.

Zensar Technologies Limited concluded its 63rd Annual General Meeting (AGM) on July 30, 2026, addressing key corporate governance matters including the approval of financial statements for FY26 and significant related party transactions. The meeting, chaired by H. V. Goenka, Chairman, was conducted through Video Conferencing/Other Audio Visual Means (VC/OAVM) in compliance with Ministry of Corporate Affairs (MCA) circulars and SEBI Listing Regulations. This session marks a critical juncture for shareholders to ratify the company’s financial health and strategic operational agreements for the upcoming fiscal year.

The proceedings began at 3:30 P.M. (IST) after the quorum was established, with 42 members present via the National Securities Depository Limited (NSDL) platform. The Board of Directors highlighted the industry scenario and the company’s financial performance for FY25-26. Statutory Auditors M/s. SRBC & Co. LLP and Secretarial Auditors M/s. J. B. Bhavé and Co., represented by Mr. Jayavant B. Bhavé, were present to address queries regarding their respective reports, which were not read out as per regulatory provisions.

Key Agenda Items

Shareholders voted on four primary items of business during the AGM. The resolutions covered statutory approvals, dividend declarations, director re-appointments, and specific transactional limits.

The approval of material related party transactions is particularly notable, authorizing dealings with step-down subsidiary Zensar (South Africa) Pty Ltd for an aggregate value of INR 7,500 Million for the financial year 2026-27. This limit underscores the scale of cross-border operational dependencies within the group structure.

Voting Process and Compliance

In adherence to Regulation 44 of the SEBI Listing Regulations, the company facilitated remote e-voting from July 27, 2026, at 9:00 A.M. (IST) to July 29, 2026, at 5:00 P.M. (IST). Members present at the AGM who had not voted remotely were provided an additional 15-minute window to cast their votes electronically via the NSDL platform. Mr. Jayavant B. Bhavé, Proprietor of M/s. J. B. Bhavé & Co., served as the Scrutinizer to ensure a fair and transparent voting process. The consolidated voting results are scheduled to be announced within two working days and uploaded to both the company’s website and the NSDL e-voting portal.

What the Numbers Show

The authorization of INR 7,500 Million in related party transactions with a single step-down subsidiary indicates a concentrated operational reliance on the South African entity for the upcoming fiscal year. While this facilitates streamlined intra-group services or resource sharing, it necessitates ongoing monitoring by the Audit Committee to ensure arm’s length pricing and alignment with shareholder interests, particularly given the substantial volume relative to typical inter-company service agreements.