Sagility Ltd, an IT-enabled, pure-play healthcare focused solutions and services provider, saw its shares climbing 14 per cent in Thusrday’s trade, as analysts said the company logged robust growth and Ebitda margin in Q2FY26. The stock climbed 13.73 per cent to hit a high of Rs 57.90 on BSE. ICICI Securities upgraded the stock price target to Rs 65 from Rs 62, as it believes the company is faring well on all parameters.
FY26 revenue growth and Ebitda margin guidance upgrade and kick starting of dividend payout were a major Q2 positives, the brokerage said.
Aditya Birla Money sees the stock at Rs 78, saying Sagility has been able to tread the challenging US healthcare landscape well, indicating its domain expertise & strong customer relationships.
“It has also been able to leverage the technology and AI well to reap benefits both from external & internal applications. The scale of benefits & cost savings derived by the niche offerings to the clients makes Sagility’s business sticky & integral. We expect the cross-selling synergies to reflect in company’s H2 performance which is expected to be better driven by kick off of the open enrolment season,” it said.
Among notable ongoing business developments for Sagility, debt reduction plan is on track and AI adoption has increased along with net sequential hiring of 4,268. There is a steady reduction in top-10 client concentration, strong Ebitda margin expansion and increased ACV.
“We see more upside on Sagility,” the brokerage said.
ICICI Securities maintained its ‘Buy’ rating and one-year forward P/E multiple of 26 times, as it builds in FY26E dollar revenue growth of 21.2 per cent, and FY25-28E revenue and EPS CAGR of 16 per cent and 29.2 per cent, respectively.
Sagility is aiming to achieve 21 per cent-plus revenue growth (including Broadpath), revised upwards from 20 per cent earlier. It gave an Ebitda growth guidance of 25 per cent for FY26, which excludes other income, against 24 per cent earlier. This guidance, ICICI Securities said, is a strong growth indicator, as no other IT peers have upgraded the higher end of their
guidance.
Annual enrolment period has kicked off. The company is also expecting a better Q3 against last year. Earnouts for DCI and Birch AI will be over by FY26 end, it noted.
“GenAI will result in revenue cannibalisation, but the percentage of revenue cannibalised is uncertain. Sagility expects genAI to be a net positive opportunity with increased scope of work, contrary to the perception that genAI will adversely impact BPO companies. Deal construct is mostly PMPM (per person per month) vs. FTE-based model earlier. The rate of work done by humans could be higher vs. rate charged by AI,” ICICI Securities said.
Sagility said it has deployed 25 AI use cases across nine clients. GenAI based savings vary depending on work, on a case-to-case basis.