Quess Corp Shares Slide 10% Despite Strong Q4FY25 Financial Results Post-Demerger

Market Performance

On May 20, 2025, Quess Corp shares slid nearly 10% during intra-day trading, surprising many investors. This drop came despite the company reporting robust financial results for the March 2025 quarter (Q4FY25). The stock fell to an intraday low of ₹336.60, down 9.9% from its previous levels.

• The share price is now trading about 25% below its 52-week high of ₹448 reached in September 2024.
• The stock remains 23% above its 52-week low of ₹267.83 from June 2024.
• Over the past year, the shares have been volatile, losing 41% overall, but have shown recent signs of recovery with gains over the last four months.

Main News: Strong Q4FY25 Results Amid Market Headwinds

Quess Corp's Q4FY25 earnings marked the first report after its demerger, signaling a new phase as a standalone workforce management company. Despite challenging market conditions, including macroeconomic headwinds and sector-specific issues in general staffing, Quess posted solid financials:

• Revenue: ₹3,656 crore, a 3% year-on-year (YoY) increase.
• Adjusted Profit After Tax (PAT): ₹63 crore, up 49% YoY from ₹42 crore last year.
• EBITDA: ₹67 crore, a 13% YoY rise.
• EBITDA Margin: Improved slightly to 1.8% from 1.7% in Q4FY24.

Key business segments drove this performance:

• Professional staffing saw strong momentum with increased tech-focused hiring and new client wins, especially in global capability centers (GCCs).
• The overseas business recorded its best-ever quarterly performance in the Middle East, although challenges persisted in Singapore.

Reflecting confidence in future returns, Quess's board declared a final dividend of ₹6 per share and approved a new policy to distribute up to 75% of free cash flow to shareholders.

Company Details: Full-Year FY25 Highlights

For the full financial year 2025, Quess Corp reported:

• Total revenue: ₹14,967 crore, up 9% YoY.
• EBITDA: ₹262 crore, a 12% YoY increase.
• Adjusted PAT: ₹210 crore, a 54% surge compared to FY24.

Executive Director and Group CEO Guruprasad Srinivasan emphasized sustained non-linear growth with a 42% YoY EBITDA growth in professional staffing. This growth was powered by technology-driven hiring and improved operations.

He also noted challenges in general staffing due to the NBFC ramp-down but expressed optimism for FY26 growth. The demerger has allowed Quess to focus better, optimize costs, and target a 20% return on equity (RoE).

Summary

While Quess Corp shares slid 10% amid a volatile market environment, the company's Q4FY25 results reveal strong underlying fundamentals. Important financial indicators like revenue, EBITDA, and PAT showed healthy growth, driven by resilient segments like professional staffing and overseas markets.

Despite short-term stock volatility, Quess Corp's strategic focus post-demerger and improved cost efficiencies position it well for sustainable growth in FY26. The company's commitment to shareholder returns through dividends further underscores confidence in its financial health.