Quess Corp: Navigating Growth with Strategic Precision in Q2 FY26

Quess Corp Limited, a leading Indian business services provider, has reported a quarter of robust performance and strategic advancements for Q2 FY26 and H1 FY26. The company demonstrated strong execution, achieving its highest-ever quarterly EBITDA of INR 77 crores, marking an impressive 11% year-on-year growth. This pushed the EBITDA margin past the 2% mark, signaling enhanced profitability. Consolidated revenue for Q2 FY26 stood at INR 3,832 crores, a 3% increase year-on-year and a 5% sequential rise. The company's net cash balance reached INR 273 crores after distributing approximately INR 90 crores in dividends, underscoring its disciplined cash flow management and strong liquidity position.

Despite a marginal 5% year-on-year decline in headcount due to a ramp-down by an NBFC in Q4 FY25, Quess Corp added over 21,000 associates in Q2 FY26, the strongest net additions in the last six quarters. This brought the total associate count to 483,115, solidifying its position as India's largest domestic staffing player. The General Staffing segment, contributing 86% of the consolidated revenue, delivered a robust performance with INR 3,317 crores in revenue, growing 3% year-on-year and 6% quarter-on-quarter. This growth was primarily driven by festive hiring momentum in manufacturing, BFSI, and consumer retail sectors, supported by 72 new contracts. The segment maintained a healthy gross margin, with a Collect & Pay ratio of 76% and a DSO of 25 days.

Strategic Focus and Segmental Performance

Professional Staffing continued its exceptional performance, delivering sustained double-digit growth in both revenue and profitability for the second consecutive quarter. The segment reported revenue of INR 224 crores, up 11% year-on-year, and achieved its highest-ever EBITDA of INR 27 crores, a 37% year-on-year growth, with a robust margin of 12.2%. This success is attributed to sustained demand for skilled talent in higher-value areas and the rationalization of low-margin contracts. A significant 73% of Professional Staffing headcount is now engaged in Global Capability Centre (GCC)-led projects, particularly in digital and telecom roles, highlighting a strategic shift towards high-value services.

The Overseas business also performed well, with revenue reaching INR 290 crores, a 3% year-on-year increase, and an EBITDA of INR 18 crores, maintaining a stable 6.2% margin. Headcount grew by 16% year-on-year to 5,730, with strong delivery across regions like the Middle East and Malaysia, which showed significant headcount and EBITDA growth in the IT/ITES sector. The Philippines also saw an 8% quarter-on-quarter headcount growth. However, the Singapore business faced challenges, experiencing a 7% decline in foreigner headcount, which the company is offsetting by building general staffing capabilities and focusing on local hires.

Digital Platforms, the fourth vertical, continues to expand its reach. The Hamara Jobs platform now boasts over 12.6 million registered candidate profiles, establishing a leading position in India's blue-collar recruitment space. Taskmo, the gig workforce model, secured its first large-scale gig contract worth INR 5 crores, deploying about 1,500 taskers nationwide. While this segment is in an investment phase, currently showing operational EBITDA losses, it underscores Quess Corp's ambition to build India's largest digital employment ecosystem across the blue and gray collar economy.

Outlook and Management Commentary

Management expressed confidence in sustaining growth momentum into the second half of the year, driven by improved demand visibility, favorable tailwinds from GST reforms, and strong execution across business lines. The company's focus remains on operational excellence, capital efficiency, and AI-led productivity. They anticipate adding 10,000 to 15,000 net associates in the coming quarters, aiming for a single-digit headcount growth on a yearly basis for the full year. Finance costs are expected to rationalize to around INR 9-10 crores quarterly.

Quess Corp's Q2 FY26 performance reflects a balanced growth strategy, with a clear emphasis on margin expansion and prudent capital management. The company's investments in high-value segments, technology, and robust sourcing engines are expected to drive sustained profitability and market leadership in India's dynamic staffing industry. The strategic focus on GCCs and the expansion of digital platforms position Quess Corp for continued growth and innovation in the evolving workforce solutions landscape.