Patel Chem H1FY27 Results (BSE: 544460)
Signal: Margin pressure
The read
The trajectory is growth with deteriorating conversion: revenue rose 25.03% YoY to ₹7,649.10 lakh and EBITDA rose 14.13% to ₹1,013.53 lakh, but gross margin contracted 429bps to 24.31%, PAT grew only 2.28% to ₹626.90 lakh, and operating cash flow turned negative at ₹785.60 lakh.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹76.49 Cr | +25.03% | N/A |
| EBIT | ₹9.51 Cr | +11.53% | |
| Net profit | ₹6.27 Cr | +2.28% | |
| EPS | ₹2.52 | +2.02% | |
| EBIT margin | 13.25% |
P&L walk
Standalone revenue increased 25.03% YoY to ₹7,649.10 lakh, but gross margin compressed 429bps to 24.31% as raw-material cost rose to 76.56% of revenue from 73.28%; EBITDA still grew 14.13% to ₹1,013.53 lakh, while PAT rose only 2.28% to ₹626.90 lakh after tax expense increased 41.24%.
Key positives
- Revenue increased 25.03% YoY to ₹7,649.10 lakh, maintaining a strong top-line trajectory despite no volume or realisation split being disclosed.
- Employee benefits plus other expenses grew only 3.64% YoY to ₹943.29 lakh versus 25.03% revenue growth, supporting EBITDA growth of 14.13% to ₹1,013.53 lakh.
- Interest coverage remained high at 16.18x on EBIT of ₹950.93 lakh and finance costs of ₹58.77 lakh.
- Receivable days improved to 75.7 days from 88.1 days at March 31, 2026.
Key concerns
- Gross margin fell 429bps YoY to 24.31% as raw-material cost rose to 76.56% of revenue from 73.28%; the filing does not disclose pricing or pass-through action.
- Operating cash flow was negative at ₹785.60 lakh despite PAT of ₹626.90 lakh, with inventory increasing ₹971.70 lakh during the half year.
- Inventory days increased to 85.1 days from 72.2 days, indicating greater working-capital intensity even as receivable days improved.
- PAT growth of 2.28% materially lagged revenue growth of 25.03% because tax expense increased 41.24% to ₹265.26 lakh.
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