Newgen's operating margin leads IT peers as overseas growth recovers
EMEA and the Americas grew year on year, while new enterprise additions and AI deals supported the quarter's business update.
Filed 23 Oct 2026, 13:47 IST · Newgen Software Technologies Ltd (NEWGEN)
Key takeaways
- Newgen's 25.83% consolidated operating margin was 6.37 percentage points above the 19.46% median for 16 reported IT peers.
- EMEA recovered with 19.4% year-on-year growth, while the Americas expanded 17.1% during the quarter.
- Newgen added nine enterprise customers and reported three AI deal wins in FY26–27, with three live AI references.
Price around the results
25.83% margin puts Newgen above the IT peer median
Newgen reported consolidated revenue of Rs 422.24 cr and operating profit of Rs 109.05 cr, resulting in a 25.83% operating margin. That was 6.37 percentage points above the 19.46% median operating margin of 16 IT peers that had reported. Profit before tax included Rs 11.44 cr of other income, while the tax rate was 21.12%.
International markets supplied the clearest growth signals
Management said EMEA recovered during the quarter, with 19.4% year-on-year growth. The company told investors that the Americas continued to expand at 17.1% year on year. Newgen also added nine enterprise customers during the quarter.
AI product activity is moving beyond development
The presentation said Newgen won three AI deals in FY26–27 and has three live references. Management described Agent Studio as a platform to deploy, monitor and govern different types of AI agents, while Agent Flow 2.0 connects low-code deterministic flows with LLMs and MCP tools. The company also said it has filed 67 patents to date, including 11 in AI.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 |
|---|---|
| Revenue | ₹422 cr |
| Other income | ₹11 cr |
| Expenses | ₹313 cr |
| Operating profit | ₹109 cr |
| Operating margin (%) | 25.83% |
| Interest | ₹1 cr |
| Depreciation | ₹9 cr |
| Profit before tax | ₹110 cr |
| Tax | ₹23 cr |
| Net profit | ₹87 cr |
| EPS (₹) | ₹6.16 |
Operating margin of 25.83% compares with a Information Technology sector median of 19.46% across 16 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +4.38% | +3.70% |
Volume on the results session was 1.22× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- The EMEA region recovered during the quarter, with 19.4% year-on-year growth.
- The Americas region continued to expand, recording 17.1% year-on-year growth.
New orders
- Newgen added nine enterprise customers during the quarter.
- Newgen won three AI deals in FY26–27 and has three live references.
New initiatives
- NewgenONEAI Studio Agent Studio is designed to deploy, monitor and govern single-turn, multi-turn and plan-and-execute AI agents.
- NewgenONEAI Studio Agent Flow 2.0 provides low-code deterministic flows that call LLMs and MCP tools.
- NewgenONE Marvin provides generative AI capabilities across ECM, BPM and CCM, including classification, auto-fill, Q&A and summaries.
- Newgen has 67 patent filings to date, including 11 in AI.
What to watch
- Whether consolidated operating margin remains above 25.83%.
- Whether EMEA growth stays above the 19.4% year-on-year rate reported this quarter.
- Further enterprise customer additions against the nine added this quarter and AI deals against the three won in FY26–27.