Mphasis Eyes Record Q4FY26 Amid Deal Pipeline Surge

Mphasis is poised for a robust conclusion to FY26, with the January-March quarter expected to be the year's best. This projection is supported by a strong deal pipeline and an increasing conversion of order wins into revenue, positioning the company for accelerated growth in FY27. Despite a net profit of ₹442 crore in Q3FY26, a 5.7% dip from the previous quarter, the company's leadership remains optimistic.

The CEO highlighted a total contract value win of approximately $2 billion over the trailing twelve months, fueling confidence in Q4FY26 growth and setting a strong foundation for FY27. While formal guidance for FY27 will be provided in April, the company anticipates positive momentum, with recent headwinds now behind them. BFSI and insurance continue to be significant growth drivers, with insurance seeing over 30% growth and BFSI nearing 20%.

Mphasis is observing a reprioritization of spending in the BFSI sector, with clients increasing investments in AI stacks. This shift, while impacting older technology stacks, presents opportunities for companies aligned with new builds. The US BFSI environment remains stable, with leading banks indicating significant spending over the next two to five years to enhance customer experiences and reimagine their businesses.

Regarding profitability, Mphasis maintains its margin guidance between 14.75% and 15.75%. While currently operating at the midpoint of this band, the company retains flexibility. The increasing prevalence of new IP platforms in their pipeline, with 69% tied to it, suggests potential for improved pricing and performance.