GENPACT LIMITED (G): what the price assumes

boothcheck covers GENPACT LIMITED (G) but does not put one priced-in number on it: here the defensible answer is the evidence rather than a point estimate. boothcheck publishes no house fair value, target price, or buy/sell rating. Narrative composed 2026-07-26.

Generated: 2026-09-07 · Exported: 2026-09-09 · Source: https://boothcheck.com/report/G

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.

Solve inputs: computed at a 8.1% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

The price is supported by asset-based and earnings-power and relative-multiple and growth-DCF value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Asset, Earnings, Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.2%); the inversion above states its own rate.

Per-Model Detail (n=15)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

• Two businesses share one income statement: Advanced Technology Solutions revenue grew 24.3% in the first quarter of 2026 to $345 million and now makes up 27% of the total, while Core Business Services, the other 73% at $951 million, grew 1.4%.
• The largest risk is written into the company's own annual report, which says plainly that as these technologies evolve, we expect that some services that we currently perform for our clients will be replaced, in whole or in part, by AI, including generative AI and agentic solutions, or other forms of automation, and the slow-growing three quarters of revenue is exactly where that pressure lands.
• Management has guided fiscal 2026 to net revenue growth of at least 7% with the advanced technology line growing at least 20%, so the next two prints show whether the fast piece is compounding quickly enough to outrun the slow one.

Bull Case

From a distance the reported numbers describe a mature outsourcer: revenue up 6.6% in 2025, mid-teens profitability, a share count edging down. That description misses the actual shape of the business, which is two companies growing at completely different speeds and slowly swapping places.

The filings do the disaggregation for you. Advanced Technology Solutions, the data and AI side, generated $1,204.1 million of net revenue in 2025, up $175.0 million or 17.0% from $1,029.1 million. Core Business Services, the long-standing process operations, generated $3,875.8 million, up 3.7%. In the first quarter of 2026 that gap widened rather than narrowed: the advanced line reached $345 million, up 24.3%, and now accounts for 27% of the total, while the core line reached $951 million, up 1.4%. A quarter of the revenue growing at four to five times the pace of the rest is a mix shift with real force behind it. Give it a few years of that arithmetic and the small piece is the company.

Mix shift usually costs margin. Here it has done the opposite. First-quarter gross profit was $472 million, and management described it as the twelfth consecutive quarter in which gross margin widened year over year. Income from operations reached $199 million, up 8.1%, on a 15.3% operating margin, and the full-year outlook puts gross margin roughly 50 basis points above last year again. Profit is growing faster than revenue, which is what a genuine efficiency gain looks like from the outside.

The reason a firm like this can charge for automation rather than be destroyed by it sits in the annual report's description of what it sells. Under enterprise functional services, the filing describes process intelligence developed over decades of running operations for large clients, extending not only to specific industries but to specific enterprise functions. That is the difference between a company that supplies labour and one that supplies knowledge about how a particular insurance claim or a particular procurement cycle actually works. Software can copy a workflow. It has more trouble copying the record of having run ten thousand of them.

Scale is real too, and it is concentrated where the money is. The filing states that Revenues from our High Tech and Manufacturing segment in 2025 were $2.0 billion, representing 39.3% of our 2025 net revenues. Set the whole company against its cohort and the profitability is competitive rather than lagging: ACN runs a 14.5% operating margin and CTSH 15.8%, while EPAM runs 9.7% and DXC 7.7%. Genpact sits with the better half of that list on margin and, on operating profit, in the lower half of the peer group's range of multiples.

Capital allocation supports the shareholder rather than diluting them. The share count has fallen roughly 2.3% a year since early 2022, and the company retired about 1.8 million shares in the first quarter of 2026 for roughly $70 million. Fiscal 2025 operating income came to 750.2 million dollars while gross interest expense ran 73.5 million, which leaves an enormous amount of room, and it is that room rather than any growth heroics that funds the buying.

Bear Case

The bear case here was written by the company, in its own risk factors, in language no analyst would improve on. Some of these technologies, such as cloud-based services, AI, automation, and others that may emerge, have reduced and replaced, in whole or in part, some of our historical services and solutions and may continue to do so in the future. Note the tense. Not may reduce. Have reduced.

Follow that thought to where the revenue actually is. Core Business Services was $951 million in the first quarter of 2026, roughly three quarters of everything the company sells, and it grew 1.4%. This is the process-operations work: the running of somebody else's back office, priced historically against the cost of the people doing it. If the technology genuinely replaces some of that, the line does not slow to 1%. It goes negative, and every dollar the advanced technology side adds has to refill a hole before it counts as growth.

The company is explicit that this is the expectation rather than the tail risk. The annual report states that as these technologies evolve, we expect that some services that we currently perform for our clients will be replaced, in whole or in part, by AI, including generative AI and agentic solutions, or other forms of automation. Nobody writes that sentence about a business they think is safe. The bull answer is that Genpact sells the replacement. The bear answer is that the replacement carries a smaller ticket, because software priced on outcomes and software priced on headcount are different-sized markets, and the whole industry is trying to make the same pivot at once. The filing does not pretend otherwise: Our industry is highly competitive, and we may not be able to compete effectively.

Now put that against what the price is asking. Around nine times company-wide operating profit sounds like a bargain, and on a static reading it is: every family of valuation method lands above where the shares trade. But a low multiple is only cheap if the earnings base is durable, and the durability question is precisely the one the company's own disclosure raises. A services business whose largest line is being automated and whose smaller line is growing fast is not obviously mispriced. It may simply be a business the market has decided to value on the part it can still see.

Two nearer-term things also deserve a look. Cash conversion moved the wrong way in the first quarter of 2026: operations used $24 million of cash against $40 million generated in the same quarter of 2025. One quarter proves nothing in a business with seasonal collections, but it is worth watching in a year when the story is operating leverage. And the buying back of stock, which is genuinely value-accretive at the right level, happened during the first quarter at an average of 38.61 dollars a share, comfortably above where the shares have since settled. Repurchases retire shares. They do not retire the question of what those shares were worth on the day.

The concession is substantial and should be stated plainly: gross margin has expanded for twelve straight quarters, the advanced technology line is growing above 24%, and the balance sheet carries no strain at all. None of that answers the structural question. It just means the company has time to answer it.

Valuation

Start with how little the market is willing to underwrite. The whole enterprise changes hands for roughly nine times company-wide operating profit, a level so low that the shares sit below what a business shrinking its operating profit 5% a year would warrant. That is not a forecast of decline. It is a description of how much doubt the price contains, and it is the single most useful fact in this section.

The methods agree with each other to an unusual degree, which is itself the signal. Asset-based value, earnings power, peer multiples and forward cash flow all land above where the stock trades. Not one family reads it as expensive. When the disagreement among methods collapses like that, the report is no longer about which lens is right; it is about whether the earnings those lenses are capitalizing will still be there.

So the concrete question is durability, not multiple expansion. Genpact earned a 14.9% operating margin over the trailing year and 15.3% in the first quarter of 2026. That is not a stretched number that has to hold. It is roughly what its cohort earns: ACN reports 14.5%, CTSH 15.8%, IT 16.4%, EPAM 9.7% and DXC 7.7%. The company is priced as though its profit will erode while its peers, earning much the same margin on similar work, are not. Either the market is wrong about that or it has noticed something about the revenue mix that the margin does not yet show.

The revenue mix is where the question resolves. Advanced Technology Solutions is 27% of the total and grew 24.3% in the most recent quarter; Core Business Services is 73% and grew 1.4%. Management's own outlook for fiscal 2026 holds total growth at least 7%, with the advanced line at least 20%. Those numbers only stay compatible if the core line keeps growing at all.

The balance sheet does not constrain any of this. Funded borrowings were about 1.55 billion dollars against liquid assets near 928 million, leaving net borrowings around 625 million on that basis, or 0.83 times operating profit; counting lease obligations as well takes the net figure closer to 1.18 billion. Gross interest expense in fiscal 2025 came to 73.5 million dollars, set against operating income of 750.2 million. The share count has been falling roughly 2.3% a year since early 2022. Whatever the next few years do to this business, the financing of it is not the variable to watch.

Catalysts

First-quarter results on May 7, 2026 set the frame for the rest of the year. Net revenues reached $1.296 billion in the quarter, 6.7% above the same period a year earlier. Within that total, the advanced technology line grew 24.3% to $345 million and the core line 1.4% to $951 million. Gross profit was $472 million, income from operations $199 million and net income $148 million, with diluted earnings per share of $0.86, up 17.8%. The company also retired about 1.8 million shares during the quarter for roughly $70 million.

Guidance is where the argument becomes testable. For the second quarter management pointed to net revenues between $1.324 billion and $1.336 billion, growth of about 5.5% to 6.5%, and for the full year to net revenue growth of at least 7% with the advanced technology line growing at least 20% and gross margin near 36.5%. Note the shape of that: total growth guided below the growth of the fast segment, which is the arithmetic of a slow-growing majority quietly telling you what it expects to do.

Product news has been steady through the summer and points at the same pivot. A deductions-recovery tool for consumer goods companies arrived at the end of June, a partnership with Nestle Business Solutions to stand up a global capability center in India followed on July 9, and a banking analyst suite aimed at anti-money-laundering alert investigation was announced on July 23. None of these is individually large. Together they are the visible evidence of whether the advanced technology line is winning work in regulated, high-value functions rather than simply relabeling existing contracts, and the second-quarter report in early August is the first place that shows up in the numbers.

Peer Cohorts (Per Segment, With Filing Citations)

Financial Services (reported)

• ACN (Accenture plc)
• FY2025 10-K: …and industry organizations and associations Human and social services agencies; defense departments and military forces; public safety authorities, including justice departments; educational institutions; non-profit organizations; cities; transportation agencies; and postal, customs, revenue and tax agencies Our work…
• FY2025 10-K: …entertainment, sports, content producers (including studios), content aggregators and streaming live events (sports) and media infrastructure providers, integrated advertising agencies and creative Enterprise technology, hardware, and associated manufacturing; semiconductor including silicon design and development,…
• CTSH (COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION)
• FY2025 10-K: …services include consulting, application development, systems integration, quality engineering and assurance services as well as software solutions and related services while our outsourcing services include application maintenance, infrastructure and security as well as business process services. Revenues are…
• FY2025 10-K: …See Note 1 to our consolidated financial statements for additional information. Item 7A. Quantitative and Qualitative Disclosures about Market Risk Foreign Currency Risk We are exposed to foreign currency exchange rate risk in the ordinary course of doing business as we transact or hold a portion of our funds in…
• DXC (DXC Technology Co)
• FY2025 10-K: 25 was $12.9 billion, a decline of $796 million or 5.8%, compared to the prior fiscal year, primarily driven by a 4.6% decline in organic revenue and a 1.0% unfavorable foreign currency exchange rate impact. Organic revenue is a non-GAAP measure, as discussed in our "Non-GAAP Financial Measures." In addition, for a…
• FY2025 10-K: …us-gaap:FixedIncomeFundsMember 2024-03-31 0001688568 us-gaap:FairValueInputsLevel2Member us-gaap:FixedIncomeFundsMember 2024-03-31 0001688568 us-gaap:FairValueInputsLevel3Member us-gaap:FixedIncomeFundsMember 2024-03-31 0001688568 us-gaap:FixedIncomeFundsMember 2024-03-31 0001688568…
• EPAM (EPAM SYSTEMS, INC.)
• FY2025 10-K: …31, 2025, Financial Services was the largest industry vertical in the Americas segment and grew 16.1% in 2025 compared to the prior year, benefiting from new revenues from clients gained through our 2024 acquisitions and increased demand from insurance and payment processing clients. Software & Hi-Tech grew 6.7%…
• FY2025 10-K: …general and administrative expenses 418,715 369,055 Depreciation and amortization expense 35,957 40,009 Americas segment operating profit $ 522,115 $ 541,424 During 2025, Americas segment revenues increased $299.8 million, or 10.5%, from the previous year. Revenues from our Americas segment represented 58.0% of total…
• IT (Gartner, Inc.)
• FY2025 10-K: …clients. The majority of our GBS practices achieved mid single-digit rates or faster growth rates, with all commercial enterprise sizes and the majority of sectors also growing mid single-digit rates or faster year-over-year. Public sector contract value decreased by double digits and high single digits for GTS and…
• FY2025 10-K: …with certain of its employees. Amounts payable with known payment dates have been classified in the above table based on those scheduled payment dates. Amounts payable whose payment dates are unknown have been included in the Due In More Than 5 Years category because the Company cannot determine when the amounts will…
• INFY (INFY)
• (no filing in the citation store)

Consumer and Healthcare / High Tech and Manufacturing (reported)

• HURN (HURON CONSULTING GROUP INC.)
• FY2025 10-K: …specific services and relationships we have with our clients are not always clear and in turn, it is unclear what long-term effect they will have on the healthcare industry and consequently on our business, financial condition and results of operations. There are many factors that could affect the purchasing…
• FY2025 10-K: …political, legislative, regulatory, and other influences. Uncertainty in any of these areas could cause our clients to delay or postpone decisions to use our services. Existing and new federal and state laws and regulations affecting the healthcare and education industries could create unexpected liabilities for us,…
• FCN (FTI CONSULTING, INC)
• FY2025 10-K: …more common in the U.S., such as increased and complex litigation, corporate restructuring and bankruptcy activities, and antitrust and competition scrutiny. Additionally, shifts in trade and tariff policies can create significant challenges for companies operating in developed and emerging markets, often impacting…
• FY2025 10-K: …false 2025 FY 0000887936 P2Y http://fasb.org/us-gaap/2025#RestructuringAndRelatedCostIncurredCost P2Y http://fasb.org/us-gaap/2025#AccountsPayableAndAccruedLiabilitiesCurrent http://fasb.org/us-gaap/2025#AccountsPayableAndAccruedLiabilitiesCurrent iso4217:USD xbrli:shares iso4217:USD xbrli:shares fcn:segment…
• BAH (BOOZ ALLEN HAMILTON HOLDING CORPORATION)
• FY2025 10-K: …and our ability to assimilate and deploy new customer staff against funded backlog; cost-cutting initiatives and other efforts to reduce U.S. government spending, which could reduce or delay funding for orders for services; and delayed funding of our contracts due to delays in the completion of the U.S. government's…
• FY2025 10-K: …Gains and losses, and prior service costs and credits that have not yet been recognized through net periodic benefit cost are recognized in accumulated other comprehensive loss, net of tax effects, and will be amortized as a component of net periodic cost in future periods. The measurement date, the date at which the…
• IT (Gartner, Inc.)
• FY2025 10-K: , but also signals the long-term health of our Insights subscription business since it measures revenue that is highly likely to recur over a multi-year period. Our contract value consists of Global Technology Sales contract value , which includes sales to users and providers of technology, and Global Business Sales…
• FY2025 10-K: …and services or attending our conferences. In the ordinary course of our business and in accordance with applicable laws, we collect personal information (i) from our employees, (ii) from the users of our products and services, including conference attendees, and (iii) from prospective clients. We collect only basic…
• PAYX (Paychex, Inc.)
• FY2025 10-K: …reserves. The amounts were recorded in the other current liabilities and other long-term liabilities sections, respectively, of the Consolidated Balance Sheets. With respect to PEO health insurance, the Company offers various health insurance plans that take the form of either fully insured guaranteed cost plans or…
• FY2025 10-K: …to, the economic sanctions and embargo programs administered by the Office of Foreign Assets Control ("OFAC"), and the Foreign Corrupt Practices Act ("FCPA"). OFAC places restrictions on the sale or export of certain products and services to certain countries and persons. A violation of a sanction or embargo program,…
• ACM (AECOM)
• FY2025 10-K: ., as Administrative Agent, Swing Line Lender, and an L/C Issuer. 8-K 10.1 12/22/2015 4.7 Amendment No. 3 to Credit Agreement and Amendment No. 1 to the Security Agreement, dated as of September 29, 2016, among the Company, the Lenders party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line…
• FY2025 10-K: …and for a deductible for each claim even after exceeding the self-insured retention. We accrue for our portion of the estimated ultimate liability for the estimated potential incurred losses. We establish our estimate of loss for each potential claim in consultation with legal counsel handling the specific matters…
• TTEK (TETRA TECH, INC.)
• FY2025 10-K: …enacted numerous data privacy and security laws, including data breach notification laws, personal data privacy laws, consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other similar laws. For example, the California Consumer Privacy Act of 2018, as amended by the California Privacy…
• FY2025 10-K: …financial condition or results of operations may be adversely affected. Any infringement, misappropriation or related claims, whether or not meritorious, are time consuming, divert technical and management personnel and are costly to resolve. As a result of any such dispute, we may have to develop non-infringing…
• VVX (V2X, Inc.)
• FY2025 10-K: …could have a material adverse impact on our business and reputation. Such misconduct could include the failure to comply with federal, state, local or foreign government procurement regulations, regulations regarding the protection of classified or personal information, legislation regarding the pricing of labor and…
• FY2025 10-K: …with a competitive advantage due to a small business designation. Within our industry, companies have engaged in mergers and acquisitions to increase their competitive position. Our competitors may provide our customers with different or greater capabilities or better contract terms than we can provide, including…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.