Sonata Software shares drop 8% after management skips FY27 guidance

Sonata Software shares plunged over 7 per cent after the company refrained from giving FY27 growth guidance. Weak sentiment in IT stocks after OpenAI's latest announcement also weighed on the stock

Sonata Software share price plummeted 7.5 per cent to ₹276.3 per share on the BSE on Tuesday after the information technology company refrained from providing any growth guidance for the current financial year (FY27). 

Moreover, a sharp sell off in IT shares, following OpenAI’s announcement to launch the OpenAI Deployment Company, put added pressure on the counter. 

  At 1:20 PM, Sonata Software shares were trading 6.8 per cent lower on the BSE as against a 1.26 per cent (950 points) fall in the benchmark BSE Sensex index. 

 

Why are Sonata Software shares falling today?

Sonata Software shares witnessed selling pressure on Tuesday after the company’s management shared a “cautiously optimistic” outlook for FY27. During its concall, held with analysts and shareholders on May 11, the management said it expects “gradual improvement in growth over the medium-term”, primarily driven by AI-led initiatives. 

The management hopes to maintain the current growth momentum in its International business in the short-term, supported by a healthy AI-led pipeline. 

  For the Domestic business, the management struck a cautious note, saying that it hopes to see the segment returning to the growth trajectory sometime in FY27.

  In a television interview to CNBC TV18, however, Rajsekhar Datta Roy, chief executive officer of Sonata Software, said the company continues to see “uncertainties among some of their larger clients” across segments, and therefore it has decided not to provide any growth guidance at this stage. 

Further, the management expects TMT (Technology, Media & Telecom), HLS (Healthcare & Life Sciences), and BFSI (Banking, Financial Services & Insurance) to drive the overall growth in FY27, with the RMD vertical recovering.

 

Sonata Software Q4 results

Meanwhile, Sonata Software’s net profit soared 322 per cent to ₹76 crore during the January to March quarter, up from ₹18 crore in the same period last year (Q4FY25). 

Its revenue from operations advanced 55 per cent to ₹411 crore from ₹266 crore in the year-ago period.

  Its AI and modernisation segment won deals worth $16.9 million and AI-led pipeline surged to $280 million. Cloud and data pipeline came in at 43 per cent.

  Further, Sonata recorded order bookings worth $95 million, of which 18 per cent was AI-led, and book-to-bill of 1.16x in Q4FY26. 

  Th company’s large-deal pipeline stood at 11 during the quarter, lower than previous quarters’, largely due to deal conversion during Q4. However, the management indicated that overall pipeline momentum remains strong.

  Analysts at Emkay Global Financial Services have tweaked their earnings per share (EPS) estimates by around 1 per cent for FY27/28, factoring in the Q4 performance. 

  They, however, retain ‘Buy’ rating with a target price of ₹370.