Ador Welding Q2 FY27 Results (NSE: ADOR)

21 Oct 2026 · Analysis by Alpha Inflection

Signal: Steady quarter

The read

Q2FY27 marks a fifth consecutive quarter of margin expansion in the prior-results series, but the current quarter's 34.2% gross margin was 440bps below YoY as raw-material intensity rose to 57.8%; revenue growth accelerated to 22.6%, while PAT growth lagged at 7.7%.

P&L walk

Revenue accelerated to ₹34,474 lakh, +22.6% YoY and +11.4% QoQ, but gross margin fell to 34.2% from 38.6% as raw-material cost rose to 57.8% of revenue from 49.0%; PAT still increased 7.7% to ₹2,694 lakh.

Segments

The company reports one operating segment, Welding & Related Products and Services; consolidated PAT of ₹2,694 lakh was only ₹26 lakh above standalone PAT of ₹2,668 lakh, so the subsidiary had no material effect on group earnings in the quarter.

Key positives

• Revenue reached ₹34,474 lakh, up 22.6% YoY and 11.4% QoQ, a clear acceleration from the 5.1% YoY growth in Q3FY26 and 2.9% in Q4FY26.
• Employee benefits and other expenses grew 6.5% YoY to ₹8,006 lakh, well below revenue growth of 22.6%, helping contain the gross-margin pressure.
• Basic EPS rose 7.7% YoY to ₹15.48 and tracked PAT growth, with no dilution signal.
• The company declared an interim dividend of ₹7.50 per share for FY27.

Key concerns

• Gross margin compressed 440bps YoY to 34.2% as raw-material consumption increased to 57.8% of revenue from 49.0%; the filing does not disclose a mitigation driver.
• PAT growth of 7.7% lagged revenue growth of 22.6%, indicating substantial conversion pressure below the revenue line.
• Standalone operating cash flow was negative ₹750 lakh in H1FY27 versus positive ₹4,243 lakh in H1FY26, while inventory increased to ₹17,712 lakh from ₹15,187 lakh.
• Finance costs rose 85.7% YoY to ₹117 lakh and borrowings increased to ₹2,829 lakh from ₹27 lakh at 31 March 2026.

View original filing

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