Gennex Lab. Q1 FY27 Results (BSE: 531739)
Signal: Margin pressure
The read
The key inflection is a sharp YoY margin setback: consolidated revenue grew 16.6% but gross margin contracted 950bps to 25.6% and EBITDA margin fell 550bps to 16.0%; PAT declined only 5.9% because other income of ₹2.01 Cr contributed 40.9% of PBT, making earnings quality weaker.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹39.84 Cr | 16.6% | -34.6% |
| EBIT | ₹5.82 Cr | -15.0% | |
| Net profit | ₹4.32 Cr | -5.9% | |
| EPS | ₹0.19 | -13.6% | |
| EBIT margin | 16% |
P&L walk
Consolidated revenue rose 16.6% YoY to ₹39.84 Cr, but gross margin compressed by 950bps and EBITDA fell 13.1% to ₹6.39 Cr, leaving PAT down 5.9% to ₹4.32 Cr; other income contributed 40.9% of PBT and softened the operating decline.
Segments
The company reports one operating segment, Bulk Drugs, Biotech Products and Intermediates; consolidation added ₹5.18 Cr of subsidiary revenue and ₹71.11 lakh of subsidiary PAT, lifting group PAT to ₹4.32 Cr versus standalone PAT of ₹3.96 Cr.
Key positives
- Consolidated revenue grew 16.6% YoY to ₹39.84 Cr, while standalone revenue grew 35.3% YoY to ₹34.68 Cr.
- Employee and other expenses declined 8.4% YoY on a consolidated basis despite 16.6% revenue growth.
- Finance cost declined 8.1% YoY to ₹89.97 lakh on a consolidated basis.
- The subsidiary contributed ₹71.11 lakh of net profit, lifting consolidated PAT to ₹4.32 Cr from standalone PAT of ₹3.96 Cr.
Key concerns
- Consolidated gross margin compressed 950bps YoY to 25.6% as material and inventory costs rose to 74.4% of revenue from 65.0%, indicating cost absorption with no disclosed pass-through or mix explanation.
- EBITDA fell 13.1% YoY to ₹6.39 Cr despite 16.6% revenue growth, and EBITDA margin declined 550bps to 16.0%.
- Standalone gross margin fell 1,000bps YoY to 22.3%, while standalone EBITDA margin declined 770bps to 14.3%.
- Sequential consolidated revenue fell 34.6% from ₹60.96 Cr to ₹39.84 Cr.
Earnings quality: includes non-operating other income
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