DE Nora India Q2 FY27 Results (NSE: DENORA)
Signal: Slipped to loss
The read
The key inflection is a sharp Q2 margin reversal: gross margin fell 4562bps YoY to 17.61% after the 25.93% margin reported in Q1FY27, as raw-material intensity rose to 67.23% of revenue and inventory expense shifted to ₹323.85 lakh from a ₹287.07 lakh credit. Revenue declined only 2.22% YoY, but the cost swing and lower other income of ₹36.92 lakh drove a ₹259.97 lakh loss; H1 operating cash flow was also negative at ₹4,835.98 lakh because inventory and receivables absorbed cash.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹21.36 Cr | -2.22% | -39.44% |
| Net profit | ₹-2.6 Cr | -167.14% | |
| EPS | ₹-4.9 | -167.21% |
P&L walk
Standalone Q2FY27 revenue declined 2.22% YoY and 39.44% QoQ to ₹2,135.94 lakh; gross margin fell to 17.61% from 63.23% a year earlier, producing a ₹259.97 lakh loss versus ₹387.20 lakh profit, while lower other income added pressure.
Key positives
- Revenue from operations declined only 2.22% YoY to ₹2,135.94 lakh, limiting the top-line contraction despite a 39.44% QoQ fall.
- Warranty expense was ₹41.13 lakh, down from ₹427.15 lakh in Q1FY27, indicating that the prior quarter's warranty burden did not recur.
- The balance sheet remains ungeared, with no borrowings disclosed and cash plus investments of ₹2,576.52 lakh at September 30, 2026.
Key concerns
- Gross margin compressed 4562bps YoY to 17.61% as raw materials rose to 67.23% of revenue from 49.91%, with the filing not disclosing the cause.
- The company swung to a ₹259.97 lakh loss from ₹387.20 lakh profit YoY and ₹638.96 lakh profit QoQ despite revenue declining only 2.22% YoY.
- H1 operating cash flow was negative ₹4,835.98 lakh, driven by a ₹4,235.07 lakh inventory build and ₹1,047.91 lakh receivables increase.
- H1FY27 PAT declined 46.84% YoY to ₹378.99 lakh and EPS declined 46.68% to ₹7.14, showing that the Q2 loss materially weakened the year-to-date trajectory.
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