DC Infotech FY26: Scaling Up With a Solutions Pivot

DC Infotech and Communication ended Q4 FY26 with a sharp jump in scale and a steady improvement in profitability. Revenue for the quarter came in at 239.46 crore, up 38.64 percent year on year. EBITDA rose to 10.23 crore, up 46.89 percent, with an EBITDA margin of 4.27 percent. PAT increased to 5.66 crore, up 52.38 percent, and PAT margin improved to 2.36 percent.

The full year numbers show the same direction of travel. FY26 revenue rose to 736.97 crore, up 32.61 percent over FY25. EBITDA increased to 35.45 crore, up 35.97 percent, and EBITDA margin improved to 4.81 percent. PAT rose to 21.21 crore, up 46.27 percent, and PAT margin improved to 2.88 percent.

The company attributes the quarter’s performance to new customer acquisition, strong execution of the order book, and a better mix led by higher margin security and networking solutions. It also highlights a strategic pivot away from pure distribution toward solution selling, particularly in cybersecurity.

Q4 momentum, but margins softened sequentially

Q4 FY26 delivered strong year on year growth, but sequential metrics show some pressure. Revenue grew from 196.00 crore in Q3 FY26 to 239.46 crore in Q4 FY26. At the same time, EBITDA was broadly flat quarter on quarter at 10.23 crore versus 10.26 crore in Q3, and EBITDA margin declined to 4.27 percent from 5.23 percent. PAT moved down to 5.66 crore from 6.49 crore, and PAT margin declined to 2.36 percent from 3.31 percent.

The cost line expansion was visible in Q4. Raw material consumption rose to 217.74 crore, employee costs to 4.25 crore, and operating expenses to 7.25 crore, taking total expenditure to 229.24 crore. Interest cost also increased to 3.20 crore in Q4 compared to 2.25 crore in Q3.

While the company highlights operating leverage on a year on year basis, the quarter’s margin movement suggests that the business still operates with tight spreads and remains sensitive to mix and cost changes.

FY26: scale-up continues, with improving profitability

Over the last five years, the company’s financial trajectory has been a clear upward curve. Revenue grew from 232.51 crore in FY22 to 736.97 crore in FY26. The presentation states a revenue CAGR of about 33.4 percent across FY22 to FY26. Over the same period, EBITDA rose from 7.33 crore to 35.45 crore, and EBITDA margin improved from 3.15 percent to 4.81 percent. PAT rose from 4.01 crore to 21.21 crore, with PAT margin improving from 1.72 percent to 2.88 percent.

Return ratios, however, were mixed in FY26. ROCE declined to 18.68 percent from 21.90 percent in FY25, while ROE moved to 19.68 percent from 20.08 percent. Debt to equity increased to 0.81 from 0.70, showing higher leverage compared to the previous year.

The balance sheet shows the reason behind the leverage move. As of 31 March 2026, equity stood at 107.79 crore, up from 72.22 crore. But current liabilities rose to 263.97 crore from 173.61 crore, including short term borrowings of 87.07 crore and trade payables of 163.16 crore. On the asset side, current assets increased to 364.11 crore from 243.21 crore, led by trade receivables of 210.47 crore and inventories of 115.50 crore.

This profile is typical of a business model that is still heavy on products and distribution-linked flows. Working capital intensity can rise quickly with scale, and the company will need to keep an eye on collections, inventory turns, and short-term funding costs as it grows.

Revenue mix: still product-heavy, but services are becoming strategic

The FY26 revenue mix shows that products still form the bulk of the business. Products were 81 percent of FY26 revenue, while services were 19 percent. The presentation also lists top brand contribution, with Samsung at 17 percent, Arbor at 14 percent, Netgear at 10 percent, D-Link at 8 percent, and others at 51 percent.

The company’s stated strategy is to move from product-led distribution toward solution-driven delivery, and it explicitly mentions a goal to double the share of services revenue. It also outlines a shift toward higher margin cybersecurity solutions as part of this transition.

In terms of capabilities, the presentation frames three growth platforms.

First is AI infrastructure, where the company positions itself around AI-ready networking architecture, ML-driven performance monitoring, smart DDoS detection, and cloud and edge connectivity. It also lists strategic alliances with Samsung, Netgear, Zscaler, and Netscout or Arbor.

Second is cybersecurity, where the company outlines eight domains across network security, endpoint, web and email, DDoS, data security, next-generation firewall, application security, and SOC services. It highlights a marquee government win of 33.46 crore from the National Informatics Centre for KNN infrastructure security, with scope including DDoS protection, threat detection, and advanced analytics. It also states it achieved a Zscaler Data Security Sales Specialization.

Third is data center services. The presentation cites an India data center capacity expansion from 1.35 GW in 2024 to 5.0 GW by 2030 and notes projected capex of 20 billion dollars for data center infrastructure and 60 billion dollars for cloud infrastructure. It describes the company’s role in network fabric, cloud and cyber defense integration, and end-to-end lifecycle services for AI-ready data centers.

Way ahead: solutions, new geographies, and execution discipline

The strategic roadmap is organized around five pillars. The company states it aims to transition from products to solutions and double the services share. It plans to focus on data centers and digital infrastructure, cybersecurity, and unified communication, including leadership in Samsung LED. It also points to geographic expansion, with deeper penetration in South India and expansion into GCC and Africa markets. A new UAE subsidiary is mentioned for international reach.

On the operating side, it highlights talent upskilling through vendor certifications, optimizing service mix for margin expansion, and maintaining a sales funnel of 40 to 50 crore.

The FY26 presentation makes one thing clear. The company is growing fast, and it is trying to improve quality of revenue by increasing solution and services content. The financials show consistent growth and gradual margin improvement over multiple years, but also underline that the business remains working-capital intensive and that quarterly margins can move meaningfully with mix and costs. The next phase will depend on how quickly services can scale and how well the company can convert growth into stable margins and return ratios.