RateGain H1 adjusted EBITDA exceeds FY26 as margin hits 23.7%

RateGain reported adjusted EBITDA of Rs 362.5 crore in H1FY2027, exceeding the Rs 358.3 crore it reported for full-year FY2026, while adjusted EBITDA margin reached 23.7% from 19.6%. Management attributed the margin improvement to Sojern integration progress, operating leverage and operational-excellence efforts.

How did RateGain’s H1FY2027 profitability compare with FY2026?

RateGain’s H1FY2027 adjusted EBITDA exceeded FY2026’s full-year adjusted EBITDA by Rs 4.2 crore, and its adjusted EBITDA margin increased by 4.1 percentage points to 23.7% from 19.6%. Both figures are adjusted for deferred deal consideration related to the Sojern acquisition, which the presentation says will be incurred over three years ending in Q3FY2029.

Operating revenue was Rs 1,530.4 crore in H1FY2027, equivalent to about 84% of the Rs 1,823.6 crore reported in FY2026. Revenue had risen from Rs 1,076.7 crore in FY2025 to Rs 1,823.6 crore in FY2026, while adjusted EBITDA increased from Rs 232.1 crore to Rs 358.3 crore over the same full-year period.

What drove RateGain’s adjusted EBITDA margin expansion?

RateGain said progress on Sojern integration, operating leverage and operational excellence supported the H1FY2027 margin result. Operating revenue increased 169.5% year on year to Rs 1,530.4 crore from Rs 568.0 crore in H1FY2026, while total operating expense rose 159.5% to Rs 1,205.9 crore from Rs 464.7 crore.

Reported EBITDA consequently rose 214.2% year on year to Rs 324.5 crore, and reported EBITDA margin increased to 21.2% from 18.2%. Adding back Rs 38.0 crore of Sojern deferred deal consideration resulted in adjusted EBITDA of Rs 362.5 crore and an adjusted EBITDA margin of 23.7%.

Employee expense grew 158.0% to Rs 579.3 crore in H1FY2027 and other expense increased 160.9% to Rs 626.5 crore. Gross margin moved in the other direction, falling to 68.5% from 70.6% in FY2026 and 75.0% in FY2025; RateGain said increased AdSpend and data-partner spending to support renewals and revenue traction affected gross margins.

Why is RateGain’s reported profit below adjusted profit?

RateGain reported profit after tax, or PAT, of Rs 169.6 crore in H1FY2027, compared with adjusted PAT of Rs 207.6 crore. The Rs 38.0 crore difference was the deferred deal consideration related to the Sojern acquisition, the same item added back in adjusted EBITDA.

Reported PAT increased 73.2% year on year from Rs 97.9 crore in H1FY2026, but reported PAT margin fell to 11.1% from 17.2%. Adjusted PAT margin was 13.6%, also below the prior-year 17.2%, despite the increase in adjusted EBITDA margin to 23.7%.

Acquisition-cost amortization rose to Rs 69.4 crore in H1FY2027 from Rs 13.9 crore in H1FY2026, while finance costs increased to Rs 32.7 crore from Rs 0.6 crore. Other income declined to Rs 2.8 crore from Rs 42.2 crore, contributing to the difference between the movement in operating profitability and the movement in PAT margin.

How did RateGain’s Q2FY2027 result compare with Q1FY2027?

RateGain’s adjusted EBITDA declined 12.5% sequentially to Rs 169.1 crore in Q2FY2027 from Rs 193.4 crore in Q1FY2027. Q2FY2027 operating revenue was Rs 745.4 crore, down 5.0% from Rs 785.0 crore, and adjusted EBITDA margin declined to 22.7% from 24.6%.

The year-on-year Q2 comparison remained higher, with operating revenue up 152.6% from Rs 295.0 crore in Q2FY2026 and adjusted EBITDA up 215.4% from Rs 53.6 crore. Reported EBITDA was Rs 153.0 crore, up 185.4% year on year, while reported EBITDA margin improved to 20.5% from 18.2%.

Adjusted PAT was Rs 90.8 crore in Q2FY2027, down 20.0% from Rs 116.8 crore in Q1FY2027 but up 78.0% from Rs 51.0 crore in Q2FY2026. Its adjusted PAT margin decreased from 14.9% in Q1FY2027 to 12.2% in Q2FY2027.

What do RateGain’s cash flow and borrowings show after H1FY2027?

RateGain generated net cash from operating activities of Rs 286.6 crore in the half year ended September 2026, compared with Rs 233.7 crore in the year ended March 2026. The presentation reported free cash flow of Rs 282.3 crore in H1FY2027, above Rs 230.0 crore in FY2026, and cash and cash equivalents rose to Rs 232.2 crore from Rs 173.1 crore at the start of the year.

Total borrowings were Rs 733.2 crore at September 2026, down from Rs 921.3 crore at March 2026. Non-current borrowings fell to Rs 448.3 crore from Rs 682.6 crore, while current borrowings increased to Rs 284.9 crore from Rs 238.7 crore; financing activities used Rs 246.8 crore of cash during the half year.

Total assets were Rs 3,604.4 crore at September 2026, compared with Rs 3,559.8 crore at March 2026. Goodwill increased to Rs 1,613.9 crore from Rs 1,581.0 crore, while equity attributable to owners rose to Rs 2,206.6 crore from Rs 1,994.0 crore.

Conclusion

RateGain’s H1FY2027 result combined Rs 1,530.4 crore of operating revenue with Rs 362.5 crore of adjusted EBITDA, surpassing FY2026’s full-year adjusted EBITDA of Rs 358.3 crore. Revenue growth of 169.5% outpaced the 159.5% rise in operating expenses, lifting adjusted EBITDA margin to 23.7%, although gross margin fell to 68.5%.

The next periods will show whether Q2FY2027’s sequential decline in adjusted EBITDA to Rs 169.1 crore and margin to 22.7% continues. RateGain also says deferred Sojern deal consideration will be incurred through Q3FY2029, making the effect of that acquisition-linked expense on reported and adjusted profitability a continuing item to watch.