Firstsource Solutions Ltd. share price target

FY26 organic revenue growth guidance at top end reduced by 100bps on account rationalization. Strong 4QFY26 exit likely

Strong deal engine and pipeline visibility, but growth quality still evolving: FSL demonstrated solid execution with 4.6% QoQ CC growth healthy doubledigit YoY growth, partially aided by new acquisition. Q3 saw 5 large deals (ACV >US$5 mn), 9 new logos including 5 strategic ones (potential of US$5mn revenue run-rate annually), and an exit pipeline above US$1 bn, while 60% of strategic logos over eight quarters scaled toward US$5mn run-rate relationships. However, BFSI and Healthcare were sequentially soft and nearterm optics are affected by provider account rationalization in healthcare segment (~50 bps FY26 revenue impact), suggesting reported momentum may remain uneven despite healthy underlying demand. Accordingly, we expect...

2QFY26 revenue tad weaker than expected. EBIT margin in line. FY26 guidance maintained. Revenue acceleration likely in 2HFY26

About the stock: Firstsource Solutions (FSL) provides business process services to BFSI, communication, media, tech and healthcare. FSL is a domain driven BPM services company which has 200+ global clients, including several Fortune-500...

Firstsource (FSOL) reported a largely in-line operating performance in Q2. Revenue grew 2.3% QoQ to USD265mn (2.0% CC), a tad below our estimate.

We attended RPSG Group’s ‘Investor Day’, to understand Firstsource Solutions (FSOL)’s growth strategy and outlook. FSOL’s growth strategy encompassing the ‘OneFirstsource’ framework with focus on seven strategic
levers and its UnBPO approach (shifts focus from labor arbitrage to tech arbitrage) has started yielding early results, as reflected in the revenue growth acceleration, deal intake, and pipeline.

Retains its industry leading revenue growth outlook for FY26. Ups the lower end of the band. Strong order inflow and new logo addition helps

FSOL has signed an agreement for acquiring Pastdue Credit Solutions (PDC) – a UK-headquartered debt collection agency serving UK’s several market-leading companies, including banks, utility firms, telecom players, and government bodies – for a cash consideration of £22mn (1.3x P/S on FY24 basis).

4QFY25 came in at the upper end of guidance. 15.6% YoY CC revenue organic growth in FY25 top quadrant performance

Firstsource (FSOL) reported inline operating performance in Q4 – revenue grew 2.1% QoQ CC; EBITM expanded by 10bps QoQ to 11.2%. Growth was broadbased across verticals, except Diverse industries that saw seasonal weakness.

3QFY25 broadly in line. Estimate organic growth in FY25 is likely at ~16% CC terms. Possibly second best in the Tierr-2 set

Firstsource (FSOL) delivered yet another quarter of strong topline growth in Q3FY25; revenue grew 7.6% QoQ CC, compared to our growth estimate of 6.9%.