April 21, 2026 - ChartAlert®

TATAELXSI – Q4 FY26 Financial Results – 21-Apr-26

Tata Elxsi’s FY26 saw flat revenue and ~440 bps margin hit from cost inflation, with ~10% earnings decline in core verticals. Q4 rebound offers hope, but FY27 hinges on sustained topline recovery. Debt‑free, cash‑rich balance sheet limits downside, yet premium valuation demands earnings revival.

1–2 minutes

🔍 Observations

Topline

Revenue from operations grew a modest 0.76% YoY in FY26 (₹3,729 Cr → ₹3,757 Cr), signalling demand-side stagnation despite sequential recovery in Q4.
Q4FY26 revenue of ₹993.75 Cr grew 9.4% YoY and 4.2% QoQ — the strongest sequential print of the year, suggesting early-stage re-acceleration.
Other income remained a meaningful contributor at ₹184 Cr (FY26), reflecting treasury yield on the large cash/deposit base.

Bottomline

Reported PAT collapsed 20% YoY (₹784.94 Cr → ₹628.43 Cr) in FY26, heavily distorted by a ₹95.69 Cr exceptional item in Q3FY26.
Excluding the exceptional, pre-tax profit still declined ~10.4% YoY (₹1,028 Cr → ₹920.8 Cr), indicating genuine margin pressure independent of one-offs.
Q4FY26 PAT of ₹220.35 Cr grew 27.8% YoY and 102% QoQ — a strong recovery print that partially restores confidence.

Margins

EBITDA margin (pre-exceptional, ex-other income) compressed sharply: operating costs grew 4.9% while revenue was nearly flat, squeezing core profitability.
Employee costs as a percentage of revenue climbed to 58.1% in FY26 vs. 54.9% in FY25 — the primary margin headwind and key variable to watch.
Net profit margin contracted to 16.7% in FY26 from 21.1% in FY25 (on operating revenue basis), a ~440 bps deterioration.

Growth Trajectory

FY26 was a consolidation year: near-zero topline growth with double-digit cost inflation — a structurally concerning combination for a premium-valued IT services name.
Q4FY26 trajectory (revenue, PAT both inflecting upward YoY) offers a plausible base for FY27 recovery, contingent on demand visibility improving.
EPS fell from ₹126 to ₹100.89 YoY, eroding the earnings yield that justifies Tata Elxsi’s historically high PE multiples.

HCLTECH – Q4 FY26 Financial Results – 21-Apr-26

HCL Tech’s FY26 ends with record revenue but margin compression, rising receivables, and PAT hit by labour code. Fortress balance sheet and capex discipline stand out. FY27 hinges on outsourcing cost and receivables normalization—long‑term risk‑reward is sound, near‑term catalyst is margin inflection.

1–2 minutes

🔍 Observations

Topline

Revenue from operations surged 11.2% YoY to ₹1,30,144 Cr in FY26, with Q4FY26 clocking ₹33,981 Cr — up 12.3% YoY, signalling sustained demand acceleration into year-end.
Sequential Q4 revenue was flat (+0.3% QoQ), suggesting growth is broad-based annual rather than quarter-specific sprint.
Other income fell sharply to ₹1,530 Cr vs ₹2,485 Cr in FY25 (-38.5%), partly offsetting operational momentum at the total income level.

Bottomline

PAT declined 4.3% YoY to ₹16,652 Cr in FY26, weighed by a ₹956 Cr one-time exceptional charge (New Labour Codes) in Q3FY26; stripping this out, underlying profitability holds relatively stable.
Q4FY26 PAT of ₹4,490 Cr grew 4.2% YoY, recovering well from the Q3 dip — a clean, exceptional-free quarter restoring earnings confidence.
EPS (Basic) fell from ₹64.16 to ₹61.46 YoY, reflecting PAT compression despite flat share count.

Margins

EBITDA proxy (PBT + D&A + Finance costs): FY26 ≈ ₹27,282 Cr vs ₹28,009 Cr in FY25 — margin compression of ~60 bps on an expanding revenue base, driven by employee cost (+11.1% YoY) and outsourcing cost (+21.5% YoY) outpacing revenue growth.
Net profit margin contracted to ~12.8% in FY26 from ~14.9% in FY25 — a meaningful step-down reflecting cost structure inflation and lower other income.
Outsourcing costs as a % of revenue rose to 14.2% vs 13.0% in FY25, indicating rising subcontracting intensity.

Growth Trajectory

Revenue CAGR implied by FY25→FY26 at 11.2% is healthy for a large-cap IT player but margin dilution raises the question of whether growth is being bought rather than earned.
Q4FY26 YoY revenue growth of 12.3% — strongest quarterly print — is a promising exit rate, setting a high base for FY27.
Total comprehensive income grew 12.5% YoY to ₹20,361 Cr vs ₹18,104 Cr, outpacing PAT — FX translation gains and OCI items provided a meaningful buffer.

PERSISTENT – Q4 FY26 Financial Results – 21-Apr-26

Persistent Systems combines revenue scale, margin expansion, and cash strength. FY27 may inflect on FCF yield, but rising unbilled receivables, current assets, and subcontracting mix signal margin limits. Clean balance sheet and high earnings quality mean valuation hinges on sustaining deal momentum beyond historical growth.

1–2 minutes

🔍 Observations

Topline

Revenue crossed ₹147.5 Bn in FY26, up 23.5% YoY — broad-based acceleration rather than a one-quarter spike.
Q4FY26 revenue of ₹40.6 Bn grew 25.1% YoY and 7.4% QoQ, sustaining double-digit sequential momentum through the year.
Subcontracting costs rose 25.7% YoY, slightly outpacing revenue growth — signals heavier partner/vendor dependency in delivery mix.

Bottomline

PAT for FY26 at ₹18.7 Bn grew 33.2% YoY, meaningfully ahead of topline — operating leverage is real and compounding.
Q4FY26 PAT of ₹5.3 Bn surged 33.7% YoY and 20.4% QoQ; the quarterly exit run-rate signals a strong FY27 base.
Basic EPS expanded from ₹91.22 to ₹119.74 (+31.3% YoY), rewarding shareholders beyond just profit growth.

Margins

EBITDA margin (pre-D&A, pre-finance cost) estimated at ~20.9% for FY26 vs ~19.6% in FY25 — quiet but consistent expansion.
Net profit margin improved to 12.7% in FY26 from 11.7% in FY25 — 100 bps expansion on a ₹147 Bn revenue base is significant.
Employee cost as % of revenue held steady at ~53.9%, while other expenses rose to 12.2% vs 10.5% — worth monitoring.

Growth Trajectory

Revenue CAGR implied over FY25–26 at 23.5%; if the Q4 run-rate sustains, FY27 revenue could approach ₹180–185 Bn organically.
PAT growth (33.2%) outpacing revenue growth (23.5%) for a second successive year confirms structural margin improvement, not cyclical.
Dividend payout increased to ₹40/share vs ₹35/share — confidence in earnings durability, not just a one-off distribution.