Firstsource Solutions Limited (FSL) AI Stock Analysis

• Market Cap: ₹222.93B
• Dividend Yield: 1.13%
• Average Volume (3M): 46.64K
• Price to Earnings (P/E): 32.9
• Beta (1Y): 1.37
• Revenue Growth: 25.92%
• EPS Growth: 24.58%
• Country: IN
• Employees: 34,651
• Sector: Services
• Sector Strength: N/A
• Industry: Information Technology Services
• EPS (TTM): 2.50
• Shares Outstanding: 696,990,840
• 10 Day Avg. Volume: 41,015
• 30 Day Avg. Volume: 46,641
• PEG Ratio: 2.69
• Price to Book (P/B): 5.76
• Price to Sales (P/S): 2.96
• P/FCF Ratio: 51.30
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹350.00
• Price Target Upside: 3.72% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: ₹352.00 ▲(4.31% Upside)

Firstsource Solutions Limited's strong financial performance and positive technical indicators drive its overall stock score. However, the high P/E ratio suggests the stock may be overvalued, which could limit future gains. The absence of recent earnings call data and corporate events means these factors did not influence the score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a positive trajectory, suggesting the company is effectively expanding its market reach and product adoption.

Cash Generation

Strong cash generation enhances financial flexibility, enabling the company to invest in growth opportunities and manage debt efficiently.

Balance Sheet Health

A manageable debt level supports financial stability, reducing risk and providing a solid foundation for sustainable growth.

Negative Factors

Cost Pressures

Decreasing margins suggest rising costs, which could pressure profitability if not managed effectively, impacting long-term financial health.

Leverage Monitoring

Rising debt levels could strain future cash flows and limit financial flexibility, necessitating careful management to maintain stability.

Operating Cash Flow Efficiency

Improving cash flow efficiency is crucial for sustaining operations and funding growth without relying excessively on external financing.

Firstsource Solutions Limited Business Overview & Revenue Model

Company Description

Firstsource Solutions Limited provides business process management services in the United Kingdom, the United States, Asia, and internationally. The company offers various services across the customer lifecycle, including acquisition, account servicing, collection, and retentions; complaints handling and resolution, mortgage processing and invoice financing, and asset-based lending; compliance and risk management; lead management; sales conversion & onboarding; analytics and business intelligence; digital collections; dispute management; factoring & discounting; default management; and fraud management, as well as mortgage solutions including mortgage value chain origination, underwriting, title, post-closing, servicing, and collections. It also provides digitally enabled customer engagement solutions comprising eligibility & enrollment services; debt collections; digital mailroom operations; claims adjudication & adjustments; receivables management; intelligent automated; eligibility & enrollment; intelligent data capture; and telehealth tech support. In addition, the company offers customer experience management and digitally enabled contact center solutions, such as tier 1 and tier 2 customer support; self-service/contact avoidance; complaints handling and remediation; inbound and outbound sales; retention and loyalty; customer insights/analytics; and revenue generation, as well as meter 2 cash operations; self-service/digital deflection; customer insights/automation; and debt management. It serves the banking and financial services, healthcare, telecom and media, insurance, mortgage, and utilities sectors. The company was formerly known as ICICI Onesource Limited and changed its name to Firstsource Solutions Limited in November 2006. The company was incorporated in 2001 and is based in Mumbai, India. Firstsource Solutions Limited is a subsidiary of RPSG Ventures Limited.

How the Company Makes Money

Firstsource Solutions Limited generates revenue primarily through outsourcing contracts with clients across different industries. The company operates on a fee-for-service model, charging clients based on the volume of services provided, such as the number of customer interactions handled or transactions processed. Key revenue streams include customer care services, technical support, and back-office operations, with significant contributions from long-term contracts with major corporations in healthcare and financial services. Additionally, Firstsource benefits from partnerships with technology providers that enhance its service offerings and operational capabilities, allowing the company to deliver value-added solutions that drive client retention and revenue growth.

Firstsource Solutions Limited Financial Statement Overview

Summary

Firstsource Solutions Limited demonstrates strong financial health with consistent revenue growth and profitability. The balance sheet reflects moderate leverage and a robust equity position, while cash flow metrics indicate solid cash generation. Despite some cost pressures affecting margins, the company maintains a stable financial position with potential for continued growth.

Income Statement

Firstsource Solutions Limited shows a solid revenue growth rate of 4.52% TTM, indicating a positive trajectory. The gross profit margin of 30.51% and net profit margin of 7.48% TTM reflect stable profitability, although there is a slight decline in gross profit margin compared to previous periods. EBIT and EBITDA margins are healthy at 11.24% and 15.32% TTM, respectively, showcasing operational efficiency. However, the slight decrease in gross profit margin suggests potential cost pressures.

Balance Sheet

The company's debt-to-equity ratio of 0.58 TTM indicates moderate leverage, which is manageable. Return on equity stands at 15.65% TTM, reflecting efficient use of equity to generate profits. The equity ratio of 52.47% TTM suggests a strong equity base relative to total assets, enhancing financial stability. While leverage is under control, the increase in total debt over time warrants monitoring.

Cash Flow

Operating cash flow to net income ratio is 0.44 TTM, indicating good cash generation relative to net income. Free cash flow growth of 13.15% TTM is a positive sign, showing improved cash flow management. The free cash flow to net income ratio of 0.76 TTM suggests strong cash flow relative to earnings. However, the operating cash flow coverage ratio indicates room for improvement in cash flow efficiency.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	221.83B	79.80B	63.36B	60.22B	59.21B	50.33B
Gross Profit	47.47B	29.85B	15.68B	12.92B	15.31B	16.42B
EBITDA	35.11B	12.08B	9.93B	9.89B	9.60B	7.25B
Net Income	16.99B	5.94B	5.15B	5.14B	5.37B	3.62B
Balance Sheet
Total Assets	83.21B	79.22B	60.83B	56.64B	57.09B	48.30B
Cash, Cash Equivalents and Short-Term Investments	3.02B	2.29B	2.08B	2.11B	2.14B	2.04B
Total Debt	23.69B	25.69B	15.33B	13.93B	17.84B	11.94B
Total Liabilities	39.55B	38.24B	23.82B	22.97B	26.75B	20.30B
Stockholders Equity	43.66B	40.98B	37.00B	33.67B	30.33B	27.99B
Cash Flow
Free Cash Flow	20.27B	4.60B	5.60B	7.41B	6.19B	8.02B
Operating Cash Flow	24.41B	7.01B	6.45B	7.95B	7.04B	9.76B
Investing Cash Flow	-3.89B	-7.46B	-579.93M	163.53M	-5.95B	-3.50B
Financing Cash Flow	-19.54B	225.92M	-5.64B	-7.43B	-1.58B	-6.89B

Firstsource Solutions Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 337.45
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:FSL, the sentiment is Negative. The current price of 337.45 is above the 20-day moving average (MA) of 336.17, below the 50-day MA of 344.60, and below the 200-day MA of 352.03, indicating a bearish trend. The MACD of -6.63 indicates Positive momentum. The RSI at 38.99 is Neutral, neither overbought nor oversold. The STOCH value of 32.47 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:FSL.

Firstsource Solutions Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAMS	74 Outperform	₹178.54B	38.43	―	1.32%	12.35%	8.91%
ECLERX	74 Outperform	₹218.84B	35.14	―	0.02%	17.83%	20.34%
TCI	70 Outperform	₹80.02B	18.40	―	0.94%	9.97%	16.28%
FSL	70 Outperform	₹222.93B	32.86	―	1.13%	25.92%	24.58%
RAILTEL	66 Neutral	₹113.31B	35.33	―	0.79%	29.92%	22.87%
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
HGS	49 Neutral	₹19.91B	-2,141.07	―	1.51%	-2.43%	-100.43%

Firstsource Solutions Limited Corporate Events

Firstsource Buys TeleMedik to Bolster US Healthcare and Telehealth Capabilities

Firstsource Health Plans and Healthcare Services, LLC, a step-down subsidiary of Firstsource Solutions Limited, has acquired 100% of Jaye Inc. d/b/a TeleMedik, a Puerto Rico-based outsourced healthcare and telehealth service provider, for a cash consideration capped at USD 3 million, including upfront payment and earn-outs. The completed transaction, which is not a related-party deal and required no regulatory approvals, is aimed at expanding and consolidating Firstsource’s clinical care capabilities and deepening its access to the US healthcare provider and payer ecosystem, reinforcing the group’s positioning in the US healthcare contact centre and telehealth market.

Firstsource Buys TeleMedik to Boost U.S. Healthcare Reach and Digital Capabilities

Firstsource Solutions Limited has acquired Puerto Rico-based TeleMedik, a pioneer in technological solutions for healthcare, in a deal that significantly expands its clinical and utilization management capabilities and deepens its presence in U.S. payer and provider networks, particularly in Puerto Rico and other underserved, often Spanish-speaking markets. By combining Firstsource’s AI-driven automation and BPaaS platform with TeleMedik’s operational footprint and relationships, the company aims to offer a unified, end-to-end medical management lifecycle service—from prior authorization and clinical review to care and disease management and telemedicine-enabled interventions—designed to help health plans contain costs, improve quality and efficiency, and enhance member and provider experiences amid rising utilization and a shift to value-based care.

Firstsource Solutions Announces Key Leadership Changes in Healthcare Division

Firstsource Solutions Limited has announced significant leadership changes in its healthcare division, appointing Mr. Matthew Barlow as President of Healthcare Payer Services and Mr. Scott Schrader as President of Healthcare Provider Services, effective December 15, 2025. These appointments aim to strengthen the company’s capabilities in healthcare services, following the resignation of Mr. Venkatgiri Vandali, who previously held the position of President of Healthcare and Lifesciences Operations. These strategic changes are expected to enhance Firstsource’s market positioning and operational efficiency in the healthcare sector.

Firstsource Solutions Sees Positive Outlook in Credit Rating Update

Firstsource Solutions Limited announced that CRISIL Ratings has revised its outlook on the company’s long-term bank facilities from ‘Stable’ to ‘Positive’, while reaffirming the rating at ‘Crisil A+’. The short-term rating remains at ‘Crisil A1’. This change reflects a positive shift in the company’s financial stability and could enhance its market position, potentially benefiting stakeholders by indicating improved creditworthiness.

Firstsource Solutions Recognized as Global Leader in Generative AI Services

Firstsource Solutions Limited has been recognized as a Global Leader in Generative AI Services by the ISG Provider Lens 2025 study. This recognition highlights Firstsource’s ability to deliver secure, repeatable, and outcome-driven GenAI platforms, emphasizing its integrated end-to-end approach that combines domain maturity, AI innovation, and robust enterprise-grade orchestration. The company’s modular GenAI platforms, such as its HealthTech platform and AI Coach, enable clients to validate, co-design, and rapidly scale GenAI use cases. This recognition underscores Firstsource’s commitment to shaping pragmatic GenAI transformation across industries, helping enterprises innovate, adapt, and grow in the evolving AI landscape.

Firstsource Solutions Expands into Canada with New Subsidiary

Firstsource Solutions Limited has announced the incorporation of a new subsidiary, Firstsource Solutions Canada Inc., through its wholly owned subsidiary, Firstsource Group USA Inc. This strategic move aims to expand the company’s business operations into the Canadian market, enhancing its international presence in the IT and BPO services sector. The new subsidiary is a step-down entity and is part of the company’s related party structure, with the incorporation involving a 100% subscription to the share capital.