Sonata Software FY25 results: 440% dividend, PAT up

Key updates at a glance

Sonata Software (NSE: SONATSOFTW | BSE: 532221) reported its audited financial results for the year ended March 31, 2025 (FY25) and highlighted progress in deal wins and vertical diversification. The board recommended a final dividend of 440% for FY25, equivalent to ₹4.40 per equity share on a face value of ₹1. Separately, the company also reported a strong Q3 FY26 performance update with consolidated revenue of ₹3,080.60 crore and PAT before exceptional item of ₹127.50 crore, indicating 21.4% year-on-year growth, along with a third interim dividend of ₹1.25 per share.

FY25 dividend decision and shareholder payouts

The final dividend recommendation of ₹4.40 per share (440%) was positioned as part of the company’s shareholder returns alongside its reported performance for FY25. The announcement came with audited numbers for the year ended March 31, 2025. The company also declared a third interim dividend of ₹1.25 per share in the Q3 FY26 update shared in the provided information.

Management commentary and strategic focus

Samir Dhir, Managing Director and CEO, said the company delivered a quarter-on-quarter EBITDA growth of 1.9% in Q4 FY25. He attributed momentum to a diversification strategy that increased the share of Healthcare and BFSI to 35% of total business, up from 13% three years ago. Sonata also positioned itself as a modernization engineering firm and highlighted its “PLATFORMATION” framework.

Deal wins and customer additions

Over FY25, Sonata said it secured 11 large deals, including two in Q4. The company also noted large deal wins that included Fortune 500 clients, as mentioned in the provided context. In International IT Services, the company added 14 new customers during the quarter.

International IT Services: FY25 growth, EBITDA decline

International IT Services revenue for FY25 was ₹2,829.7 crore, up 5.6% year-on-year. However, Q4 FY25 revenue declined 4.0% quarter-on-quarter to ₹702.3 crore. EBITDA (before other income and forex) for FY25 fell 14.7% year-on-year to ₹480.5 crore, while Q4 EBITDA rose 8.0% quarter-on-quarter to ₹115.7 crore.

PAT after exceptional items for International IT Services rose 69.9% year-on-year to ₹246.6 crore in FY25 (FY24: ₹145.1 crore). In Q4, segment PAT increased 9.5% quarter-on-quarter to ₹62.3 crore. DSO improved to 61 days in Q4 FY25 from 64 days in Q3 FY25.

Domestic Products and Services: strong FY25, softer Q4

Domestic Products and Services revenue for FY25 was ₹7,340.6 crore, up 23.4% year-on-year, while Q4 revenue declined 9.1% sequentially to ₹1,918.2 crore. Gross contribution for FY25 increased 14.8% year-on-year to ₹299.1 crore, though Q4 gross contribution declined 4.3% sequentially to ₹78.4 crore.

EBITDA (before other income and forex) for the domestic business grew 26.8% year-on-year to ₹208.6 crore in FY25, and Q4 EBITDA was ₹56.5 crore, up 0.1% quarter-on-quarter. FY25 PAT rose 9.0% year-on-year to ₹178.1 crore, while Q4 PAT declined 6.0% sequentially to ₹45.2 crore. DSO improved to 46 days in Q4 from 51 days in Q3.

Consolidated FY25: revenue up, EBITDA down, PAT higher

On a consolidated basis, FY25 revenue was ₹10,157.2 crore, up 17.9% year-on-year. Q4 consolidated revenue was ₹2,617.2 crore, down 7.9% quarter-on-quarter. Consolidated EBITDA for FY25 declined 5.2% year-on-year to ₹689.3 crore, while Q4 EBITDA increased 5.8% quarter-on-quarter to ₹172.5 crore.

Consolidated PAT after exceptional items rose 37.6% year-on-year to ₹424.7 crore in FY25 (FY24: ₹308.5 crore). In Q4, consolidated PAT was ₹107.5 crore, up 2.4% quarter-on-quarter. Net cash and equivalents rose to ₹262 crore in Q4 from ₹176 crore in Q3.

Stock market reaction to the results

Sonata Software’s share price rose nearly 5% on Thursday, touching an intraday high of ₹414.95 on the BSE after the company reported Q4 results. At around 9:51 AM, the stock traded at ₹401.70, up 1.22% from the previous close. The BSE Sensex was almost flat at the time, up 0.01% at 80,752.04.

Snapshot table: FY25 and Q4 FY25 performance

Why the numbers matter for investors

The audited FY25 print shows a combination of strong revenue growth and improved PAT alongside a year-on-year decline in consolidated EBITDA. Segment-level detail also showed that International IT Services saw FY25 EBITDA decline even as PAT increased, while Domestic Products and Services delivered higher FY25 revenue and EBITDA growth but reported sequential softness in Q4 revenue and PAT.

Operationally, Sonata highlighted improving working capital indicators, with DSO improvement in both International IT Services (to 61 days) and Domestic Products and Services (to 46 days) in Q4. The increase in net cash and equivalents to ₹262 crore in Q4 from ₹176 crore in Q3 was also reported as part of the quarterly update.

Conclusion

Sonata Software’s FY25 results combined higher consolidated revenue and PAT with a decline in full-year EBITDA, while Q4 showed sequential improvement in consolidated EBITDA. The board’s final dividend recommendation of ₹4.40 per share (440%) and the earlier third interim dividend of ₹1.25 per share add to the set of shareholder return actions reported alongside these updates.