BASF India Q2 FY27 Results (NSE: BASF)
Signal: Margin pressure
The read
The Q2FY27 inflection is negative after Q1FY27's margin recovery: revenue grew 23.8% YoY, but implied EBITDA margin fell to 2.6% from 4.6% and standalone PAT fell 38.9% to ₹617.1 million. The dominant issue is a 251bps gross-margin compression, with three segments moving into losses despite Industrial Solutions and Nutrition & Care improving.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4,832.19 Cr | +24.0% | +0.2% |
| EBIT | ₹85.61 Cr | -40.4% | |
| EBIT margin | 2.6% |
P&L walk
Consolidated revenue increased to ₹48,321.9 million, +24.0% YoY and +0.2% QoQ, but the implied EBITDA margin fell to 2.6% from 4.6% as cost of materials, purchases and inventory movements absorbed the revenue growth; the supplied extract does not include consolidated total PAT or EPS after the continuing-operations line.
Segments
Industrial Solutions generated ₹835.8 million of segment result, up 80.2% YoY, and Nutrition & Care generated ₹655.1 million versus ₹93.0 million; these gains were outweighed by Agricultural Solutions turning to a ₹286.3 million loss, Materials turning to a ₹4.5 million loss and Chemicals turning to an ₹81.1 million loss.
Key positives
- Consolidated revenue reached ₹48,321.9 million, +24.0% YoY, reversing the recent Q2FY26 revenue decline recorded in the prior-results series.
- Industrial Solutions segment result rose to ₹835.8 million from ₹463.8 million, +80.2% YoY, while Nutrition & Care rose to ₹655.1 million from ₹93.0 million.
- Employee and other expenses grew 18.5% YoY to ₹4,521.7 million, slower than revenue growth of 24.0%, and finance costs fell 65.9% to ₹25.4 million.
Key concerns
- Gross margin compressed 251bps YoY to 11.3%, while raw-material consumption rose to 35.6% of revenue from 28.6%; the filing does not disclose the driver.
- Agricultural Solutions moved from a ₹500.5 million segment profit to a ₹286.3 million loss, Materials from ₹364.1 million profit to a ₹4.5 million loss, and Chemicals from ₹122.8 million profit to an ₹81.1 million loss.
- Standalone operating cash flow was negative ₹3,470.6 million in H1FY27 despite H1 profit before tax of ₹5,823.3 million, with receivables and inventories absorbing ₹13,901.1 million.
Research and educational content only. Not investment advice.