Dynamic Cables Q2 FY27 Results (NSE: DYCL)
Signal: Margin pressure
The read
The key inflection is margin deterioration: revenue accelerated to ₹36,319.23 lakh, +29.0% YoY, but gross margin compressed 405bps to 16.7% as material costs rose 39.3% YoY, while estimated EBITDA margin fell 107bps to 10.3%; the reported PAT-to-EPS mismatch and inconsistent tax presentation require clarification.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹363.19 Cr | +29.0% | +4.0% |
| EBIT | ₹33.92 Cr | +16.2% | |
| Net profit | ₹22.15 Cr | -41.5% | |
| EPS | ₹4.57 | +12.8% | |
| EBIT margin | 10.3% |
P&L walk
Revenue increased to ₹36,319.23 lakh, +29.0% YoY and +4.0% QoQ, but gross margin fell to 16.7% from 20.7% as raw-material cost rose to 88.2% of revenue from 81.7%; estimated EBITDA margin declined to 10.3%, while PAT was ₹2,215.23 lakh, down 41.5% YoY and 11.2% QoQ.
Key positives
- Revenue was ₹36,319.23 lakh, up 29.0% YoY and 4.0% QoQ, maintaining strong top-line momentum.
- Employee and other expenses fell 7.1% YoY to ₹2,434.35 lakh despite revenue growth of 29.0%, supporting cost discipline below gross profit.
- PPE increased 11.5% YoY to ₹10,755.21 lakh and CWIP increased 5.1% to ₹3,420.54 lakh, while depreciation rose 23.5% to ₹347.67 lakh, indicating assets are entering the operating base.
Key concerns
- Gross margin fell 405bps YoY to 16.7% as material cost plus inventory change increased to 83.3% of revenue from 79.3%; the filing does not identify the cause or quantify pass-through.
- Estimated EBITDA margin declined 107bps YoY to 10.3%, showing that lower employee and other-expense intensity did not offset raw-material pressure.
- Finance costs rose 48.4% YoY to ₹424.64 lakh and 48.6% QoQ, increasing the below-EBITDA drag.
- Reported PAT of ₹2,215.23 lakh fell 41.5% YoY while EPS rose 12.8% to ₹4.57, requiring reconciliation.
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