Arfin India Q1 FY27 Results (NSE: ARFIN)
Signal: Margin pressure
The read
The revenue rebound accelerated to ₹21,277.33 lakh, +95.5% YoY versus Q4FY26 growth of 26.0%, but the key trajectory concern is margin reversal: gross margin contracted 508bps YoY and EBITDA margin fell 162bps to 4.86% after two preceding quarters of expansion, while PAT growth to ₹407.45 lakh was amplified by the low year-ago base and lower tax intensity rather than operating leverage.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹212.77 Cr | +95.5% | +10.1% |
| Net profit | ₹4.07 Cr | +277.1% | |
| EPS | ₹0.24 | +300.0% | |
| EBIT margin | 4.86% |
P&L walk
Consolidated revenue increased from ₹10,886.05 lakh to ₹21,277.33 lakh, +95.5% YoY, but gross margin compressed from 16.46% to 11.38% and EBITDA margin declined from 6.48% to 4.86%; lower finance cost and a sharply lower tax charge still lifted PAT from ₹108.10 lakh to ₹407.45 lakh.
Segments
There is no reported segment split; the wholly owned subsidiary contributed ₹767.83 lakh of revenue and ₹54.15 lakh of PAT, lifting consolidated PAT of ₹407.45 lakh above standalone PAT of ₹353.30 lakh.
Key positives
- Consolidated revenue increased to ₹21,277.33 lakh, +95.5% YoY and +10.1% QoQ, reversing the YoY declines reported in Q1FY26 and Q2FY26.
- Finance costs were ₹450.26 lakh, -0.8% YoY, despite revenue increasing +95.5% YoY, reducing finance-cost intensity to 2.12% of revenue from 4.17%.
- Consolidated PAT reached ₹407.45 lakh, +277.1% YoY, and EPS rose to ₹0.24 from ₹0.06 with unchanged paid-up capital of ₹1,687.22 lakh.
- The subsidiary contributed ₹54.15 lakh of PAT, creating a ₹54.15 lakh gap between consolidated PAT of ₹407.45 lakh and standalone PAT of ₹353.30 lakh.
Key concerns
- Gross margin compressed 508bps YoY to 11.38% despite revenue growth of 95.5%; cost of materials consumed rose 60.0% YoY to ₹17,431.00 lakh and inventory movement shifted to a ₹1,424.58 lakh increase from a ₹1,803.13 lakh decrease.
- Derived EBITDA grew 46.5% YoY to ₹1,034.03 lakh, materially below revenue growth of 95.5%, and EBITDA margin fell 162bps YoY to 4.86%; this is not an operating-leverage quarter.
- PAT declined 40.3% QoQ from ₹682.43 lakh to ₹407.45 lakh, while EBITDA margin declined 347bps QoQ from 8.33%.
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