R Systems Intl. Q3 FY27 Results (NSE: RSYSTEMS)
Signal: Margin expansion
The read
The trajectory has strengthened: Q3 revenue growth of 23.4% follows 12.4% in Q2FY26, 23.6% in Q3FY26 and 30.1% in Q4FY26, while reported EBITDA margin expanded 418bps YoY to 19.70%; the key question is whether the 306bps gross-margin gain and 33.2pp EBITDA-versus-revenue growth gap are sustained as AI-led growth scales.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹615.2 Cr | +23.4% | +2.2% |
| EBIT | ₹97.1 Cr | +64.1% | |
| Net profit | ₹64.18 Cr | +81.6% | |
| EPS | ₹5.42 | +81.3% | |
| EBIT margin | 19.70% |
P&L walk
Revenue increased 23.4% YoY to Rs. 6,152.00 mn, gross margin expanded 306bps to 38.60%, EBITDA rose 56.6% to Rs. 1,212.18 mn and PAT rose 81.6% to Rs. 641.83 mn; the quarter shows operating leverage alongside input-cost or mix-related gross-margin improvement, although the gross-margin driver was not disclosed.
Segments
No segment results table was disclosed; vertical mix shifted toward TIPS at 41.12% of revenue from 38.94% YoY and BFSI at 21.40% from 17.33%, while Health fell to 10.93% from 13.54% and Manufacturing & Logistics to 10.88% from 13.82%.
Key positives
- Revenue reached Rs. 6,152.00 mn, up 23.4% YoY and 2.2% QoQ, while US$ revenue grew 12.5% YoY, indicating continued underlying demand despite currency effects.
- Reported EBITDA grew 56.6% YoY to Rs. 1,212.18 mn versus revenue growth of 23.4%, with margin expanding 418bps to 19.70%; employee costs grew only 9.6% and declined 1.4% QoQ.
- Gross margin expanded 306bps YoY to 38.60%, with cost of revenues falling to 61.40% of revenue from 64.46%.
- Blended utilization improved 103bps QoQ to 82.16%, while top-10 client concentration remained moderate at 24.44%, down from 26.15% YoY.
- Cash and bank balances net of short-term borrowing and dividend provision rose to Rs. 3,487 mn from Rs. 2,726 mn at December 31, 2025.
Key concerns
- Finance costs rose 157.4% YoY to Rs. 95.81 mn, materially faster than revenue growth; the filing does not explain the increase.
- Billed and unbilled DSO increased to 76 days from 73 days at December 31, 2025, indicating some working-capital absorption despite strong profit growth.
- Adjusted EBITDA margin of 20.23% exceeded reported EBITDA margin of 19.70% because of Rs. 32.25 mn of RSU expense, so headline profitability remains partly affected by employee equity costs.
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