Workmates recurring revenue rose 43% and mix reached 87%

Workmates reported Rs 82.97 crore of recurring revenue in H1 FY27, up 43% from H1 FY26, lifting recurring revenue to 87% of Rs 95.21 crore in revenue from operations. Consolidated revenue rose 27% year on year, while EBITDA increased 24% to Rs 16.44 crore and profit after tax rose 32% to Rs 12.03 crore.

How did Workmates’ H1 FY27 revenue change?

Workmates’ revenue from operations rose to Rs 95.21 crore in H1 FY27 from Rs 74.69 crore in H1 FY26 and Rs 69.13 crore in H2 FY26. This represented 27% year-on-year growth and 38% half-on-half growth. Management said H1 FY27 revenue was about 4% ahead of its outlook.

Revenue shifted further toward recurring contracts during the period. Recurring, or annuity, revenue increased by Rs 25.10 crore year on year to Rs 82.97 crore, while project implementation revenue declined by Rs 4.58 crore to Rs 12.24 crore. The recurring mix therefore rose from 77% in H1 FY26 to 87% in H1 FY27, although it was one percentage point below the 88% recorded in H2 FY26.

What moved Workmates’ recurring revenue during H1 FY27?

Workmates’ monthly recurring revenue, or MRR, increased to Rs 15.90 crore in September 2026 from Rs 13.50 crore in April 2026. The MRR bridge shows that new logos added Rs 0.41 crore per month and upsell, cross-sell and usage expansion added Rs 2.34 crore per month.

Customer exits reduced MRR by Rs 0.35 crore per month across 19 customers in H1 FY27. Gross revenue churn was 2.6%, compared with 2.4% in FY26, while gross revenue retention was 97.4%, versus 97.6% in H1 FY26. Management’s annualised gross revenue churn target is 10% or less.

Workmates signed Rs 30 crore of new bookings, measured by total contract value, across recurring and project work in H1 FY27. It also reported Rs 9.5 crore of annualised revenue carried into H2 under contracts covering the next 12 months. Management stated that the September 2026 exit MRR of Rs 15.90 crore puts FY27 on track for revenue of Rs 188 crore to Rs 210 crore.

Did Workmates’ profit increase with revenue?

Workmates’ gross profit, EBITDA and profit after tax all rose year on year in H1 FY27. Gross profit increased 25% to Rs 31.92 crore, EBITDA, or earnings before interest, tax, depreciation and amortisation, rose 24% to Rs 16.44 crore, and profit after tax increased 32% to Rs 12.03 crore from Rs 9.08 crore.

Margins recovered from H2 FY26 but differed from H1 FY26 levels. Gross margin was 33.53%, below 34.25% a year earlier but above 31.21% in H2 FY26. EBITDA margin was 17.27%, compared with 17.75% in H1 FY26 and 14.54% in H2 FY26, while profit-after-tax margin rose to 12.64% from 12.17% and 9.88%, respectively.

What costs and investment did Workmates disclose?

Workmates reported headcount of 169 in H1 FY27, compared with 168 in H2 FY26, while billable utilisation remained 84% in both periods. Management said cost per resource had increased significantly and that it had invested in research and development for artificial-intelligence accelerators.

Cloud consumption and third-party costs rose to 66.47% of revenue in H1 FY27 from 65.75% in H1 FY26, an increase of 72 basis points. Employee benefit expense fell to 10.78% from 11.19%, while other operating expenses remained 7.05% in both periods. Management said monetisation of AI accelerators would significantly increase revenue and alter the services mix, without providing a financial timetable.

How did Workmates’ customers and cash metrics move?

Workmates increased total customers to 337 at September 30, 2026, from 316 at March 31, 2026, and enterprise customers to 44 from 38. It added 54 logos in H1 FY27, comprising 34 recurring-business logos and 20 project-implementation logos. The company had 28 clients with annualised revenue run rates above Rs 1 crore and average annualised revenue per client of Rs 58.8 lakh.

Financial services, insurance and banking contributed 40.56% of H1 FY27 revenue, up from 34.2% in FY26, while IT and IT-enabled services contributed 34.57%, down from 36.9%. The top 20 customers accounted for 71% of H1 revenue versus 73% in FY26. India represented 96.26% of revenue and international business represented 3.74%.

Workmates ended September 2026 with Rs 43.88 crore in cash, bank balances and liquid investments, down from Rs 53.95 crore at March 31, 2026, and reported zero borrowings at both dates. Trade receivables increased to Rs 39.50 crore from Rs 28.99 crore, debtor days rose to 64 from 62, and cash flow from operations was negative Rs 4.70 crore in H1 FY27 compared with negative Rs 0.07 crore in H1 FY26. Capital expenditure increased to Rs 2.36 crore from Rs 1.21 crore.

Conclusion

Workmates’ H1 FY27 performance shows that recurring contracts expanded faster than total revenue, with annuity revenue up 43% to Rs 82.97 crore and representing 87% of revenue from operations. Profit after tax grew 32% to Rs 12.03 crore, while the margin comparison shows improvement from H2 FY26 despite higher cloud and third-party costs as a share of revenue.

The next disclosed benchmarks are management’s Rs 188 crore to Rs 210 crore FY27 revenue range, supported by September 2026 exit MRR of Rs 15.90 crore, and its annualised gross revenue churn target of 10% or less. Management has also identified monetisation of AI accelerators as a planned driver of revenue and services mix, but did not disclose a timetable or financial contribution target.