EFC (I) Q4 FY26 Results (NSE: EFCIL)
Signal: Margin pressure
The read
Q4FY26 marks the 4th straight quarter of OPM compression (from 52% in Q3FY25 to 49%) as cost of services surged 680bps to 45.5% of revenue. Revenue growth decelerated sharply to 38.9% from 126.9% a year ago. Full-year PAT grew 35.1% vs revenue +81%, a widening gap. Standalone PAT crashed 60.4%, confirming the growth story is entirely subsidiary-driven. Operating cash flow coverage of PAT remains weak at 55.9% on standalone books. The merger of Whitehills Interior contributed scale but also debt and lease liabilities of ₹10,046 lakh.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹2.93 Cr | 38.9% | 8.5% |
| EBIT | ₹1.44 Cr | 45.5% | |
| Net profit | ₹0.69 Cr | 14.7% | |
| EPS | ₹4.69 | 14.7% | |
| EBIT margin | 49% |
P&L walk
Consolidated Q4 revenue grew 38.9% YoY to ₹293 Cr, but decelerated from 126.9% in Q4FY25; OPM contracted 300bps to 49%, the 4th consecutive quarter of margin compression, driven by cost of services rising 680bps to 45.5% of revenue. Employee costs dropped 540bps to 7.9%, indicating cost restructuring. Depreciation jumped 112% YoY as fresh assets capitalised. PAT grew 14.7% to ₹69 Cr, tracking operating profit but diluted by higher finance costs (+87% YoY). Full-year PAT ₹246 Cr, +35.1% YoY, below revenue growth of 81%.
Segments
The consolidated group operates in a single interior fit-out segment; the standalone entity's PAT of ₹1,259 lakh is only 5.1% of consolidated PAT ₹24,613 lakh, confirming the subsidiaries (post-merger of Whitehills Interior) drive 95% of group earnings.
Key positives
- Consolidated revenue crossed ₹1,018 Cr full-year, +81% YoY, showing strong project execution scale.
- Employee cost as % of revenue dropped 540bps YoY to 7.9% — fixed-cost leverage from the workforce.
- Full-year PAT ₹246 Cr, +35.1% YoY, with no exceptional items impacting the bottom line.
Key concerns
- OPM contracted 300bps YoY to 49% — the 4th consecutive quarter of margin compression, driven by cost of services rising 680bps to 45.5% of revenue.
- Revenue growth decelerated to 38.9% in Q4 from 126.9% a year ago and 52.5% in Q3FY26.
- Standalone PAT crashed 60.4% YoY — the parent company's earnings are minimal, with 95% of group profit from subsidiaries.
- Standalone operating cash flow ₹4,546 lakh covered only 55.9% of PAT ₹8,133 lakh, driven by sharp trade receivables increase of ₹10,981 lakh.
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