Kellton Tech's Q2 FY26: AI-First Strategy Drives Robust Growth Amidst Strategic Expansion

Kellton Tech Solutions Ltd., a prominent player in the digital transformation and AI space, has delivered a strong performance in the second quarter of fiscal year 2026. The company reported a consolidated total revenue of INR 30.09 crore, marking an impressive 11.1% year-on-year growth. This top-line expansion was complemented by a robust increase in profitability, with EBITDA climbing 15.6% year-on-year to INR 3.78 crore, and net profit surging by 23% year-on-year to INR 2.41 crore. These figures underscore Kellton Tech's operational discipline and the increasing global demand for its AI-first solutions.

The quarter's performance highlights Kellton Tech's strategic focus on leveraging advanced technologies to drive client success. The company's EBITDA margin stood at 12.6%, with a PAT margin of 8.0%. While the Earnings Per Share (EPS) remained flat at INR 0.42, this was primarily attributed to the conversion of FCCB round 1 into equity, which increased the total number of outstanding shares. Management clarified that this was a planned event, and the underlying profit growth remains strong.

Financial Highlights: A Snapshot of Q2 FY26

The financial summary for Q2 FY26 showcases Kellton Tech's consistent growth trajectory:

Note: All values are converted from Million to Crore for consistency. EPS for FY26 and previous periods has been restated on a ₹1 face value basis for comparability due to a share split.

The company's revenue mix by business segment for Q2 FY26 further illustrates its core strengths:

This breakdown clearly indicates that Digital Transformation remains the dominant and fastest-growing segment, aligning with the company's strategic focus on AI-first solutions and modernizing enterprise IT landscapes.

Strategic Initiatives and Client Wins Powering Future Growth

Kellton Tech's Q2 FY26 was marked by several significant operational achievements and new client acquisitions, reinforcing its position as a leader in digital innovation. The company successfully implemented a next-generation integration platform (iPaaS) for a major global food services enterprise, going live across 10 countries and over 1,500 stores. This project involved a complete overhaul of legacy middleware, showcasing Kellton's capability in large-scale digital transformations.

In the media and entertainment sector, Kellton played a pivotal role in powering the live streaming of the Asia Cup 2025 for a leading OTT platform. This achievement, enabling uninterrupted, high-quality digital broadcasting for millions, highlights their deep expertise in cloud-native engineering and low-latency streaming. Furthermore, Kellton received formal appreciation from a leading agri-tech enterprise for its exceptional collaboration and technical excellence during a critical production phase, underscoring its commitment to client success.

Strategically, Kellton signed a Memorandum of Understanding (MoU) with a leading European technology company to jointly develop a sovereign, human-centric AI ecosystem under the EU-India Framework Agreement. This collaboration aims to contribute to an AI Gigafactory, enhancing capabilities in advanced AI, Cloud, and Cybersecurity services. Adding to its global impact, Kellton partnered with the United Nations Population Fund (UNFPA) to build next-generation AI solutions for global impact, a testament to its commitment to leveraging AI for social good.

New client wins further diversified Kellton's portfolio. The company partnered with a U.S. consumer finance company to integrate Agentic AI frameworks for automating risk modeling and decision workflows, setting a new standard for intelligence-driven decision-making in the BFSI sector. Another significant win involved expanding an intelligent payment processing framework for a global packaging solutions provider, now extending to the Netherlands region with AI-assisted automation. Kellton also secured partnerships with a leading engineering and industrial enterprise for a large-scale SAP S/4HANA digital transformation and was empaneled as a key technology partner by a global logistics conglomerate for AI-driven initiatives.

Management Outlook and Future Trajectory

Management expressed confidence in the company's direction, emphasizing its AI-first strategy and commitment to building an AI-powered enterprise of the future. Niranjan Chintam, Chairman & Whole-time Director, highlighted the company's focus on expanding the real-world impact of Agentic AI and Generative AI by integrating these capabilities into its engineering and data platforms. The company aims for a long-term EBITDA margin target of 20%, indicating a clear focus on sustainable profitability.

Kellton Tech is actively pursuing inorganic growth, with funds from the FCCB round earmarked for acquisitions within the next year. These acquisitions will primarily target deep tech companies to enhance existing technology capabilities, particularly in AI, and expand the customer base. While acknowledging that new deep tech acquisitions might initially have lower margins, management is confident in its ability to improve these post-acquisition through operational efficiencies and economies of scale. The company also plans to expand its geographic footprint, focusing on growing markets like Canada, Asia Pacific, and the Middle East, to mitigate the existing concentration risk in the American market.

In conclusion, Kellton Tech's Q2 FY26 performance reflects a company in strategic motion, effectively leveraging its AI-first approach and robust digital transformation capabilities to drive growth. With a clear vision for expansion, both organically and inorganically, and a strong pipeline of client engagements, Kellton Tech appears well-positioned to continue its journey of innovation and value creation in the dynamic global technology landscape.