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Firstsource: Riding against the tide

ICICIdirect Research 15 May 2026 DISCLAIMER

Firstsource Solutions (FSL) provides business process services to BFSI, communication, media, tech & healthcare. FSL is already embedding AI across customer lifecycle management, collections & healthcare operations, which is driving higher wallet share opportunities and strengthening strategic client relationships across BFSI and healthcare verticals.
Management has guided for 10–13% CC growth in FY27 (organic 7.5-10.5%), supported by a record deal pipeline of over US$1 bn, ramp-up of delayed UK BFS collections programs and scaling of healthcare transformation engagements. Accordingly, we expect US$ revenue to grow at 10.3% CAGR over FY26–28E. Note, its is one of the few companies with double digit growth visibility in the IT sector
Management has also guided for further margin expansion to 12.25–12.75% (50-100 bps YoY) in FY27, aided by operating leverage and AI-driven productivity gains. We have conservatively, baked in EBIT margins of 12.4%/12.6% for FY27E/FY28E.
Given the sustained growth trajectory, decent correction (~22% in last 6 months), we are constructive on the company with TP of 290
 
 
 

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