Excelsoft H1 revenue rises 34% as EBITDA falls 9% on costs

Excelsoft Technologies Limited reported first-half (H1) financial year (FY) 2027 revenue from operations of Rs 161.16 crore, up 33.94% year on year, while EBITDA fell 9.02% to Rs 26.26 crore as employee benefit and other expenses increased faster than revenue.

What changed in Excelsoft's H1 FY27 earnings?

Excelsoft grew revenue but recorded lower EBITDA in H1 FY27 than in H1 FY26. Revenue from operations increased by Rs 40.84 crore from Rs 120.33 crore to Rs 161.16 crore, while EBITDA, or earnings before interest, tax, depreciation and amortisation, declined by Rs 2.60 crore from Rs 28.86 crore. The presentation calculates EBITDA excluding other income.

Excelsoft's EBITDA margin fell to 16.29% from 23.99%, while PAT margin declined to 10.86% from 13.70%. PAT nevertheless rose 6.18% to Rs 17.50 crore, alongside other income of Rs 11.56 crore versus Rs 8.44 crore a year earlier, lower finance cost of Rs 1.11 crore versus Rs 1.97 crore, and tax of Rs 5.50 crore versus Rs 6.77 crore.

Why did Excelsoft's EBITDA decline despite higher revenue?

Excelsoft's EBITDA declined because H1 FY27 employee benefit expenses and other expenses rose by more in absolute terms than revenue. Employee benefit expenses increased by Rs 17.55 crore to Rs 85.22 crore from Rs 67.67 crore, while other expenses increased by Rs 25.89 crore to Rs 49.68 crore from Rs 23.80 crore. Total expenditure consequently rose to Rs 134.90 crore from Rs 91.46 crore.

Management attributed the quarterly profitability effect to higher employee costs, including external consultants supporting programme delivery, as well as spending on global sales and leadership capability. In Q2 FY27, employee benefit expenses were Rs 43.51 crore against Rs 33.74 crore in Q2 FY26, and other expenses were Rs 24.16 crore against Rs 12.05 crore.

The movement also reduced earnings below EBITDA. Depreciation increased to Rs 13.71 crore in H1 FY27 from Rs 12.08 crore, reducing earnings before interest and tax, or EBIT, to Rs 12.55 crore from Rs 16.79 crore. EBIT margin fell to 7.79% from 13.95%, and the presentation does not quantify the separate H1 cost of consultants, sales hiring, leadership positions or technology investment.

Which Excelsoft offering gained revenue share in H1 FY27?

Education Technology Services gained revenue share in Excelsoft's H1 FY27 business mix. Services represented 62.07% of revenue, up from 52.70% in H1 FY26, while Education Technology Products represented 37.93%, down from 47.30%. The 9.37-percentage-point increase in the services share coincided with management's statement that Education Technology Services drove H1 revenue momentum.

The pattern was also visible in Q2 FY27. Education Technology Services accounted for 60.75% of Q2 revenue, compared with 53.61% in Q2 FY26, while the products share fell to 39.25% from 46.39%. Q2 revenue rose 25.22% to Rs 80.90 crore from Rs 64.61 crore, but Q2 EBITDA declined 29.71% to Rs 13.23 crore and its margin fell to 16.35% from 29.13%.

Excelsoft describes Education Technology Services as end-to-end product engineering and customised solutions. Its Education Technology Products offering includes AI-enabled learning and assessment products such as Saras eAssessments, easyProctor, Saras eLearning, OpenPage, COLLEGE SPARC and enablED. Management cited demand for digital learning and assessment solutions, programme execution and international opportunities in discussing growth.

What growth spending has Excelsoft identified for FY27?

Excelsoft has identified Rs 20.30 crore of FY27 strategic investments in sales, leadership, talent and product development. The largest allocation is Rs 9.70 crore for an overseas sales team to expand international market coverage and build a sales funnel. Product development expensed out accounts for Rs 4.50 crore, followed by Rs 2.84 crore for leadership positions, Rs 1.80 crore for variable pay to key managerial personnel and Rs 1.46 crore for recruitment and training.

Management said these investments are intended to build capability ahead of growth, pursue larger opportunities and convert its pipeline into sustainable revenue. It also said Excelsoft remains on track to deliver its committed FY27 top-line growth and is focused on programme execution and operational efficiency. The presentation does not disclose a numerical FY27 revenue target.

Q2 FY27 revenue of Rs 80.90 crore was slightly above Q1 FY27 revenue of Rs 80.26 crore, while Q2 EBITDA of Rs 13.23 crore was also slightly above Q1 EBITDA of Rs 13.03 crore. The sequential figures indicate broadly similar revenue and EBITDA across the two FY27 quarters. The presentation does not provide a timetable for when the Rs 20.30 crore investment programme could affect operating margins.

Conclusion

Excelsoft's H1 FY27 results combine 33.94% revenue growth and a larger Education Technology Services contribution with lower operating profitability. EBITDA declined 9.02%, EBITDA margin fell 7.70 percentage points to 16.29%, and EBIT margin reduced to 7.79%, while higher other income and lower finance cost contributed to a 6.18% increase in PAT.

The next result to watch is whether Excelsoft's Rs 20.30 crore FY27 capability-building programme, including Rs 9.70 crore for overseas sales and Rs 4.50 crore of expensed product development, supports management's committed top-line growth while operational-efficiency measures affect costs. Management has highlighted AI-enabled assessment, digital learning and international opportunities, but has not disclosed a numerical FY27 revenue target in this presentation.