AIA Engineering Q2 FY27 Results (NSE: AIAENG)
Signal: Growth decelerated
The read
Q2FY27 marks a slowdown from Q1FY27's 12.4% revenue growth: consolidated revenue still rose 6.2% YoY to 111277.09 lakh, but PAT fell 10.1% to 24943.28 lakh as expenses grew 9.6% and freight outward expense jumped 53.3% YoY to 12019.82 lakh. The parent was healthier than the group, with standalone PAT down only 4.4% versus the consolidated 10.1% decline.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,112.77 Cr | +6.2% | -4.7% |
| Net profit | ₹249.43 Cr | -10.1% | |
| EPS | ₹26.76 | -10.0% |
P&L walk
Revenue increased 6.2% YoY to 111277.09 lakh, but direct-cost absorption and freight pressure reduced the derived gross margin to 63.1%; finance costs fell 79.1% YoY, yet PAT declined 10.1% because operating profitability and other income were weaker.
Segments
The company reports only one segment, Manufacturing of High Chrome Mill Internals; the key divergence is basis-related, with standalone PAT of 26501.30 lakh exceeding consolidated PAT of 24943.28 lakh, indicating subsidiaries and group items dragged the reported result.
Key positives
- Revenue from operations increased 6.2% YoY to 111277.09 lakh, maintaining positive year-on-year growth despite a 4.7% sequential decline.
- Finance costs fell 79.1% YoY to 160.64 lakh, limiting the drag from the weaker operating conversion.
- Standalone operating cash flow increased to 38939.64 lakh in H1FY27 from 36315.22 lakh in H1FY26.
- Consolidated joint-venture profit increased to 690.04 lakh from 39.58 lakh, adding to pre-tax earnings.
Key concerns
- Consolidated PAT declined 10.1% YoY to 24943.28 lakh despite 6.2% revenue growth, showing weaker earnings conversion.
- Freight outward expense rose 53.3% YoY to 12019.82 lakh, increasing to 10.8% of revenue from 7.5%.
- Total expenses grew 9.6% YoY versus 6.2% revenue growth, while other income declined 27.1% YoY to 7169.91 lakh.
- Consolidated PAT of 24943.28 lakh was below standalone PAT of 26501.30 lakh, indicating a negative subsidiary/group contribution in the quarter.
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