Updater Services (UDS) reported a 2QFY26 revenue growth of 7% YoY to INR7.3b, below our estimate of ~INR7.7b. Core EBITDA margin came in at 4.3% (est. 5.9%), down 130bp QoQ.

TeamLease Services (TEAM) reported revenue of Rs19.55bn, modest growth of 4% QoQ in Q2FY23. General staffing revenue (Rs17.8bn) growth was soft at 4.7% QoQ led by moderation in headcount addition.

all companies in NIFTY IT Index, several mid-cap, small cap IT firms and new age internet players. Management commentary across companies indicate that strong demand environment is expected to continue over medium term and revenue growth is no longer contingent on winning large deals. Pricing environment has also improved. Additionally, companies are doing aggressive fresher hiring resulting in pyramid balancing which will provide considerable margin tailwinds in FY23....

quarters and is now at 387 (vs 365 in 2Q22 and ~260-270 pre-covid) We upgrade our rating to ACCUMULATE (earlier: REDUCE) given 1) Teamlease (TEAM) is gaining market share (32% YoY growth in associate addition in 9MFY22) in strong demand environment where intent of hiring continues to improve, 2) strong operating metrics in terms of new logo additions and improving FTE productivity, 3) Yield shortfall of 1% in PF trust amounting to ~Rs.15 Cr is provided for in Rs.75 Cr provision made in Q2FY22...

TEAM delivered a strong operational performance in 2QFY22, with revenue up 10.7% QoQ on broad based growth across all three verticals. It also added 25k associates (record high) in 2Q, benefitting from a strong demand environment as well as seasonality and flow through from a COVID-impacted 1QFY22. EBITDA margin inched up by 10bp QoQ to 2.2% on strong growth in the Specialized Staffing business and partial drawdown in General Staffing,...

The spread of Covid-19 has led to lockdowns in many countries globally and could have adverse economic implications. In addition, the recent fall in crude prices could also have an adverse impact of fiscal health of oil producing countries. As a result, IT companies, which have considerable exposure to verticals such as oil, energy & utilities; banking & capital markets; manufacturing and travel & transport could see an adverse impact from the ongoing crisis. Companies like Wipro, Infosys in large cap and MindTree, NIIT Tech, Sonata software, Cyient, Accelya Solutions among...

India security solutions revenues increased 3.8% QoQ (25.3% YoY) to | 908.9 crore. EBITDA margin declined 10 bps QoQ to 6.05% driving EBITDA growth of just 2.1% QoQ. Segment headcount increased by 3222 to 1,57,922 reflecting a QoQ increase of 2.1%. The intent of the management is to dissociate revenue gradually from headcount by focusing more on technology (Tech SIS), productivity and outcome-based solutions. Revenue per branch was | 1.75 crore excluding acquisitions with every single branch having shown growth in 9MFY20. SIS has been able to drive operating...

30 January 2020 Robust organic revenue growth (+31% YoY) was almost entirely driven by general staffing. However, this has not translated into equally strong growth in EBITDA/PAT. Lower mark-ups in the recent contracts have been driving a secular decline in general staffing margins over the past few quarters. P/E multiples at a steep discount to Teamlease (57%), coupled with some of the recent positive developments, have led to a sharp re-rating (22%) over the past three months. Organic/overall revenue increased 31%/36% YoY, largely led by general staffing segment, while most other key segments remained modest at best Excluding the impact of Ind-AS 116 and the inorganic contribution from Allsec Technologies, EBITDA growth was weak at 5% YoY. Margin contraction within general staffing was the key overhang on overall margins. This could have been driven by lower mark-ups in large deals. Loss run-rate at Monster came down QoQ (EBITDA margin of -10% v/s -18% in 2Q).

NETAP addition to see better trajectory in coming quarters Revenues from general staffing (including NETAP) grew 6.8% QoQ (14.5% YoY) driven by a mix of associate growth (1.5% QoQ) and average realisation. Lower number at associate addition on a QoQ basis is due to weakness in addition in NETAP headcount (led by slowdown in manufacturing) and attrition in associates (in FMCG and retail) in December, which was usually a February phenomenon. As per the management, weakness in NETAP has bottomed out and would gradually see an...

The company's general staffing revenues increased at a lower-thanexpected rate at 16.6% YoY mainly led by mere increase of 5.4% YoY (average growth of 40% YoY in last five quarters) in NETAP headcount in this quarter. This was mainly on the back of weakness in manufacturing and auto segments. In the near term, any significant improvement in NETAP business is unlikely. However, continued growth in general staffing associate headcount (ex-NETAP) prompts us to believe the company could clock growth of 20.2% over FY19-21E in general staffing. This accompanied by acquisition of eCentric in IT staffing, led us to estimate 23.3% growth in...

Healthy demand pipeline to keep general staffing robust The company's general staffing revenues increased 23.4% YoY mainly led by associate addition of 7642 QoQ and 32678 YoY. This quarter saw a higher addition of medium and small clients, which led to an increase in mark up QoQ to | 730 per employee per month (PEPM) from | 714 in Q4FY19. The company has 12,000 open position in general staffing, which reflects that the company has good pipeline in this segment. This coupled with healthy traction from manufacturing consumer and BFSI prompt us believe that the...

General staffing to drive overall revenue growth In FY19, overall revenues grew 22.7% YoY led by 19.2% growth in total associate headcount. Total associate headcount increased 34888 YoY to 2.16 lakh in FY19, of which entire addition came from general staffing business. General staffing is mainly a volume play business. Hence, it is expected to be a major driver of revenue growth. With the management indicating ~17-18% volume growth in FY20E, we expect general staffing &...

Teamlease (TEAM) reported a tepid quarter with gross revenues declining by Change in Estimates | Target | Reco ~1% QoQ & specialized staffing and other HR service verticals pulled down overall performance. Specialized staffing growth in Q4FY19 was mild at 9.1%...