24 July 2018 TeamLeases (TEAM) revenue grew 20% YoY to INR10.2b, (in-line), with strength seen across segments (12% YoY growth in General Staffing, 205% YoY in Specialized Staffing and 156% YoY in Other HR Services). Coming out of a soft FY18, headcount growth revived sharply in 1QFY19 net addition of 5,400 sequentially was close to the 5,900 added for full-year FY18. The disappointment came on two incremental revenue from lower-realization contracts and (ii) margin pressure in Evolve because of additional hiring. Post a soft year, associate headcount addition has been strong for the quarter; momentum is expected to continue/accelerate, going forward. However, growth from lower-realization contracts in General Staffing and added expenses in Evolve are expected to cap potential profitability expansion in the near term. Although we have revised our margin assumption downward by 10bp for FY19 to factor in the near-term headwinds (and EPS by 5%), our estimates beyond that remain unchanged.