Amara Raja Ener. Q2 FY27 Results (NSE: ARE&M)
Signal: Margin pressure
The read
Q2FY27 reflects ongoing top-line volume resilience (+18.5% YoY to ₹4,109 Cr) offset by margin compression (EBITDA margin at ~8.8%) and a sharp headline PAT drop (-44.9% YoY) caused by a ₹121.8 Cr exceptional gain in the base quarter. The major strategic trigger is ARACT's approved ₹2,320 Cr capex to expand battery pack capacity to 9 GWh and build an LFP cell plant over 30 months.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4,108.71 Cr | +18.51% | -2.51% |
| EBIT | ₹200.61 Cr | -10.43% | |
| Net profit | ₹152.48 Cr | -44.85% | |
| EPS | ₹8.33 | -44.87% | |
| EBIT margin | 4.88% |
P&L walk
Consolidated top line grew 18.5% YoY to ₹4,109 Cr, but higher input costs and lack of prior-year ₹121.8 Cr exceptional gain reduced reported PAT by 44.9%.
Key positives
- Consolidated revenue grew 18.51% YoY to ₹4,108.71 Cr, sustaining high-teens growth momentum.
- Wholly-owned subsidiary ARACT approved ₹2,320 Cr capex to expand pack manufacturing capacity from 4 GWh to 9 GWh and build an LFP Cell Manufacturing plant in Telangana over 30 months.
- Standalone operating cash flow remained solid at ₹791.38 Cr in H1FY27 compared to ₹651.78 Cr in H1FY26.
- Declared an interim dividend of ₹4.30 per share (430%).
Key concerns
- EBITDA margin compressed 200 bps YoY to 8.80%, tracking ongoing operating cost pressure and sub-10% margins.
- Finance costs surged 63.4% YoY to ₹14.71 Cr driven by higher short-term borrowings of ₹547.24 Cr (vs ₹276.46 Cr in March 2026).
- Sequential revenue softened by 2.51% QoQ (from ₹4,214.54 Cr in Q1FY27).
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