- Cognizant awaits draft Indian regulations before deciding on domestic market listing
- Q3 CY2026 revenue grew 4.8% YoY, driven by financial services and North America
- Adjusted EBIT margin rose 30 basis points to 16.3%, FY26 revenue guidance narrowed
US-based IT services major Cognizant may move closer to a potential India listing in the coming weeks, with the company awaiting draft regulatory guidelines before taking a final decision on its proposed domestic market debut.
Cognizant Chief Financial Officer Jatin Dalal, during the company's third-quarter CY2026 earnings call, said the company continues to make progress on its evaluation of a potential primary offering and secondary listing in India.
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"We continue to make good progress. We are awaiting the draft regulations to come through, which we expect in a few weeks' time," Dalal said.
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He added, "We should be able to make the final decision once we see the draft regulations."
The development comes as Cognizant reported 4.8% year-on-year revenue growth in constant currency terms during the September quarter (Q3), led by its financial services business and North America operations.
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The company's adjusted EBIT margin, excluding Project Leap, expanded 30 basis points to 16.3%, while it narrowed its FY26 revenue growth guidance to 4-4.4% in constant currency terms.
Cognizant India Listing: What Did The CFO Say?
During the earnings call, Dalal said Cognizant was working closely with stakeholders and monitoring proposed changes to the regulatory framework that could facilitate its India listing.
The company expects the draft regulations to be made public for consultation before it completes its evaluation and takes a final call.
"Once that is available, we are prepared to complete our evaluation expeditiously and make a decision," Dalal said.
He added that management remained pleased with the progress made towards framing the policy and would provide further updates as appropriate.
However, Cognizant has not announced a definitive timeline for its India listing, and the proposed transaction remains subject to regulatory developments and the company's final decision.
Cognizant India IPO: When Did The Company First Reveal Its Plans?
Cognizant first publicly disclosed that it was exploring a potential primary offering and secondary listing in India in late 2025, as it evaluated opportunities to tap domestic capital markets and address the valuation gap with India-listed IT services peers.
The company reiterated its plans during its first-quarter 2026 earnings call in April, confirming that the evaluation remained underway.
However, in June, reports suggested that Cognizant's India listing plans had slowed amid market volatility and concerns over the impact of artificial intelligence on the IT services industry.
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Responding to the reports on June 15, a Cognizant spokesperson clarified that the company had not shelved its plans and continued to evaluate a potential India listing.
The company said the process remained ongoing and that it would act in the best interests of its shareholders.
The latest commentary from Dalal suggests the company is now awaiting regulatory clarity before deciding whether to proceed.
Cognizant Q3 Results: Revenue Rises 4.8%, FY26 Guidance Narrowed
Cognizant reported 4.8% year-on-year revenue growth in constant currency terms during the third quarter of calendar year 2026, supported by its financial services vertical and North American operations.
Adjusted EBIT margin, excluding Project Leap, improved 30 basis points to 16.3%, with management expressing confidence in continued margin expansion.
The company narrowed its FY26 revenue growth guidance to 4-4.4% in constant currency terms.
However, Cognizant indicated that a sustained recovery in discretionary technology spending remains critical for a broader acceleration in revenue growth.
AI Now Assists Over 50% Of Cognizant's Software Development
Cognizant also highlighted the growing role of artificial intelligence in its operations, revealing that more than 50% of its software development is now AI-assisted.
Management views AI as a potential growth driver, with outcome-based pricing, platform monetisation and integrated technology offerings gaining importance.
The company is increasingly focusing on bundled services spanning infrastructure, software, cybersecurity and AI to address enterprise technology requirements.
For Indian IT services companies, including TCS, Infosys, Wipro and HCLTech, Cognizant's commentary highlights two key industry trends i.e. the growing integration of AI into software delivery and the continued importance of a recovery in discretionary client spending.
While AI adoption could improve productivity and create new business opportunities, the pace of enterprise technology spending will remain a key factor in determining broader growth momentum across the sector.
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