Onward Technologies Q4 FY26: Record Revenue of ₹550 Crore, EBITDA up 60.9%
Onward Technologies reported record FY26 revenue of ₹550 crore (10.5% YoY growth) and EBITDA of ₹71.9 crore (60.9% YoY growth), with margins at 13.2%. Operating cash flow reached ₹127.3 crore. The company recommended a dividend of ₹8 per share. Management is focused on digital and AI capabilities and expects sustained double-digit revenue and EBITDA growth.
The announcement details record financial performance, strategic investments in AI and digital capabilities, a commitment to shareholder returns through increased dividends, and a positive outlook for sustained growth, all of which are material to investors.
The company reported record revenues and profits, significant growth in EBITDA and PAT, historical high margins, and strong cash flows. The dividend increase and positive outlook for future growth contribute to a positive sentiment.
Onward Technologies Limited announced its financial results for the fourth quarter and full year ended March 31, 2026, reporting its strongest year in history. The company achieved a record revenue of ₹550 crore, marking a 10.5% year-on-year growth, and a record EBITDA of ₹71.9 crore. Gross margins improved to a historical high of 13.2%. EBITDA saw a substantial increase of 60.9% and Profit After Tax (PAT) grew by 72.3% year-on-year. This performance is attributed to consistent execution, enhanced operating leverage, a focus on direct clients, disciplined cost control, and progress in its 3x3 vertical strategy.
The company also reported strong cash flows, with operating cash flows and net cash increasing to ₹127.3 crore, the highest ever. Over the last four years, Onward Technologies has delivered a revenue CAGR of 15.3% and an EBITDA CAGR of 35.4%, primarily driven by its focus on the U.S. and European markets, while maintaining a stable headcount of around 2,500 employees. Revenue per employee has also shown consistent growth.
In Q4 FY26 specifically, revenue reached ₹139 crore, a 6.9% year-on-year increase, with EBITDA margins at 11.2%. Growth is sustained by deep client relationships, predominantly with companies in North America and Europe, with the top 25 customers accounting for 88% of revenues. The company added six new clients in the last 12 months, all at an early stage but with signed Master Service Agreements.
Onward Technologies is investing in strengthening its digital and AI capabilities, with plans to establish a digital AI lab in Chennai. The company expects a substantial portion of its future revenue to come from digital and AI projects, driving both revenue growth and margin expansion. Attrition has been reduced to below 15%, a record low for the company.
Reflecting its strong performance and commitment to shareholder value, the Board recommended an increase in dividend to ₹8 per share, marking the 11th consecutive year of dividend payout and the highest recommended dividend to date. The company reiterated its guidance for sustained double-digit revenue and EBITDA growth, driven by its focus on digital engineering, strengthened teams in the U.S. and Europe, and positive demand for digital and engineering services, particularly in AI projects.
During the investor call, management addressed concerns about stock price performance, acknowledging the need for improved investor relations. They clarified that Onward Technologies, as an engineering services company, is not directly impacted by AI tools like Anthropic Claude, which are currently affecting IT and BPO sectors. The company is actively exploring AI integration to enhance customer value and productivity, with R&D underway to develop AI-led solutions for clients. Discussions are ongoing regarding a potential share buyback to enhance shareholder value, given the company's strong net cash position. Peers in the engineering services space were identified as L&T Technologies Services, KPIT, Cyient, and Tata Technologies. The transportation vertical saw a 1% revenue de-growth due to exiting Tier-1 and Tier-2 suppliers, but momentum is building for future growth. The company is 100% focused on the U.S. and Europe markets, with 70% revenue from North America and 30% from Europe. Margins are expected to expand further as all three verticals achieve balanced growth. The company is committed to investing in talent and capabilities to become an AI-ready digital engineering company, aiming for accelerated growth beyond the current guidance.
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