Sagarsoft (India) Limited , a prominent IT services company, has released its financial results for the second quarter and half-year ended September 30, 2025, revealing a mixed performance with revenue growth but a decline in profitability.

Revenue Growth Amidst Challenges

For Q2 FY2026, Sagarsoft reported consolidated revenue of ₹734.70 crores, marking a 14.69% increase from ₹640.57 crores in the previous quarter. This growth in revenue demonstrates the company's ability to expand its business operations despite challenging market conditions.

Profitability Under Pressure

Despite the revenue increase, the company faced significant pressure on its bottom line. Sagarsoft posted a consolidated net loss of ₹73.55 crores for the quarter, a stark contrast to the profit of ₹30.50 crores in the prior quarter. This shift from profit to loss indicates substantial challenges in maintaining profitability.

Half-Year Performance

For the six-month period ending September 30, 2025, Sagarsoft's revenue reached ₹1,375.27 crores. However, the company reported a net loss of ₹43.05 crores for this period, reflecting the ongoing profitability challenges.

Standalone Performance

On a standalone basis, Sagarsoft's performance was notably different:

The stark difference between consolidated and standalone results suggests that the company's subsidiaries may be facing more significant challenges.

Operational Highlights

• Employee Benefit Expenses: A significant increase to ₹538.17 crores in Q2 from ₹332.02 crores in the previous quarter, potentially impacting profitability.
• Business Segments: Sagarsoft continues to operate primarily in staffing and information technology services for customers in India and overseas.

Management Commentary

M. Jagadeesh, Managing Director of Sagarsoft (India) Limited, stated in the company's filing, "The Board of Directors has reviewed and approved our unaudited standalone and consolidated financial results for the second quarter and half-year ended 30th September, 2025. We remain committed to navigating the current challenges and improving our overall performance."

Looking Ahead

While Sagarsoft has demonstrated strong revenue growth, the company faces significant challenges in maintaining profitability. Investors and stakeholders will be watching closely to see how the company addresses these issues and works towards improving its bottom line in the coming quarters.

The company's ability to manage its increasing employee benefit expenses and optimize its operations across its subsidiaries will be crucial factors in its path to recovery and sustained profitability.

Sagarsoft (India) Limited , a provider of staffing and information technology services, has reported its financial results for the first quarter, along with an update on the utilization of funds from a recent preferential issue.

Q1 Financial Performance

The company's consolidated financial results for Q1 revealed a net loss of Rs 430.83 lakhs, a significant downturn compared to the profit of Rs 194.30 lakhs in the same quarter of the previous year. The total income for the quarter stood at Rs 4,106.50 lakhs, up from Rs 3,918.08 lakhs in Q1 of the previous year.

Key financial highlights for Q1 include:

The company's expenses saw a substantial increase, with employee benefits expenses rising to Rs 3,242.10 lakhs from Rs 2,628.38 lakhs in the corresponding quarter of the previous year.

Fund Utilization from Preferential Issue

Sagarsoft also submitted a statement detailing the utilization of funds raised through a preferential issue. The company had issued 2,00,000 equity shares at Rs 254 per share, raising a total of Rs 5.08 crore. The funds were originally allocated for acquisitions and general corporate purposes. However, the current utilization stands as follows:

• Rs 1.18 crore utilized for working capital requirements
• Rs 3.90 crore kept in fixed deposits

Subsidiary Incorporation

In a strategic move, IT CATS LLC, a wholly-owned subsidiary of Sagarsoft, incorporated Sarral Global, Inc., a majority-owned subsidiary based in Georgia, USA. Sagarsoft has committed to invest $1,357,000 over a year for a 51% interest in this new entity, which will focus on cybersecurity, data, and artificial intelligence services.

Auditor's Review

Walker Chandiok & Co LLP, the statutory auditors, conducted a limited review of both standalone and consolidated financial results. They reported no material misstatements in the financial information prepared in accordance with applicable accounting standards.

The Board of Directors approved these financial results at their meeting, which commenced at 4:45 p.m. and concluded at 6:00 p.m.

Sagarsoft continues to operate primarily in staffing and IT services for customers in India and overseas, maintaining its focus as a single reportable business segment.