eClerx Services Declares 1:1 Bonus Share, Q3 Profit Soars 40%

Introduction

eClerx Services Limited captured investor attention on January 28, 2026, after its board announced a 1:1 bonus share issue alongside strong financial results for the third quarter of fiscal year 2026. The company reported a significant 40.1% year-on-year increase in consolidated net profit. The dual announcement of robust earnings and a shareholder-friendly corporate action triggered a sharp rally in its stock, which surged by as much as 9% during intra-day trading, reflecting strong market confidence.

Stellar Q3 Financial Performance

For the quarter ending December 31, 2025, eClerx Services delivered a powerful financial performance. The company's consolidated net profit stood at Rs 191.8 crore, a substantial jump from the Rs 137.2 crore recorded in the same quarter of the previous fiscal year. On a sequential basis, the profit after tax (PAT) grew by 4.8% from Rs 183.19 crore in the second quarter of FY26. This consistent growth highlights the company's operational efficiency and sustained profitability.

The top-line figures were equally impressive. Revenue from operations for Q3 FY26 grew by 25.4% year-on-year to Rs 1,070.3 crore, up from Rs 853.8 crore a year ago. Sequentially, revenue saw a healthy increase of 6.5% from Rs 1,004.85 crore in Q2 FY26. In dollar terms, operating revenue rose 20.9% year-on-year to $121.7 million, indicating strong demand from its global client base.

Operational Strength and Margins

Operationally, the company demonstrated solid growth. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) rose by 33.3% year-on-year to Rs 276.1 crore from Rs 207 crore. The EBITDA margin expanded to 25.8% compared to 24.3% in the corresponding quarter last year, showcasing improved profitability. Profit before tax for the quarter was Rs 250.1 crore, marking a 35.9% year-on-year increase.

This growth was supported by an expanding operational footprint. The total delivery headcount reached 21,847 as of December 2025, an 18% increase from the previous year. While total expenses rose 22.86% YoY to Rs 794.07 crore, this was in line with business expansion, with employee benefit expenses increasing by 25% to Rs 654 crore.

Details of the 1:1 Bonus Issue

In a significant move to reward its shareholders, the eClerx board approved the issuance of bonus equity shares in a 1:1 ratio. This means for every one existing equity share of Rs 10 face value held, an investor will receive one new fully paid-up equity share of Rs 10. The proposal is subject to shareholder approval, which will be sought through a postal ballot.

The company plans to issue approximately 4.70 crore (4,70,25,359) new equity shares. This bonus issue will be funded entirely by capitalising the company's retained earnings. As of March 31, 2025, eClerx had robust retained earnings of Rs 1,377.7 crore, of which around Rs 47.03 crore will be utilized for this purpose. Following the issue, the company's paid-up equity share capital will double from Rs 47.03 crore to Rs 94.05 crore, while the authorized share capital will remain unchanged at Rs 100 crore.

Financial Performance Summary (Q3 FY26)

Impact on Shareholders and Share Capital

The bonus shares, once allotted, will rank pari-passu with existing equity shares, meaning they will carry identical rights, including voting and dividend entitlements. For shareholders, this effectively doubles their number of shares in the company without any additional investment. The company expects to credit or dispatch the bonus shares within 60 days of the board's approval, with a tentative deadline of March 27, 2026, pending shareholder consent.

A History of Shareholder Rewards

This is not the first time eClerx has rewarded its investors. The current announcement marks the company's fourth bonus issue. Previously, it issued bonus shares in September 2022 (1:2), December 2012 (1:3), and July 2010 (1:2). In addition to bonus issues, the company has also conducted share buybacks, further demonstrating its commitment to returning value to its shareholders.

Market Reaction and Analyst Outlook

The market responded positively to the announcements, with the stock price of eClerx Services rallying 8.8% to an intra-day high of Rs 4,813.65 on the day of the news. This surge reflects strong investor confidence in the company's growth trajectory and its shareholder-friendly policies. However, some analysts maintain a cautious short-term outlook. A R Ramachandran of Tips2trades noted a bearish stance on the daily charts, with strong resistance at Rs 4815 and support at Rs 4535. He suggested that a daily close below this support level could lead to a target of Rs 4068 in the near term.

Conclusion

eClerx Services has delivered a strong performance in the third quarter of FY26, with significant double-digit growth in both revenue and net profit. The board's decision to issue 1:1 bonus shares further enhances shareholder value and underscores the company's solid financial health and management's confidence in its future. The next step is securing shareholder approval for the bonus issue, while investors will continue to monitor the company's ability to maintain its growth momentum in the upcoming quarters.