Endurance Tech. Q1 FY27 Results (NSE: ENDURANCE)
Signal: Margin pressure
The read
The key trajectory issue is margin absorption rather than demand: consolidated revenue grew 30.0% YoY and Indian two-wheeler and passenger-vehicle volumes grew 23.6% and 23.0%, but EBITDA grew only 18.7% and margin fell 120bps to 13.2% as commodity and energy prices rose; standalone growth was stronger at 36.3% revenue and 17.4% PAT, while Europe remained nearly flat in euro terms at 1% growth.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4,314.89 Cr | 30.0% | N/A |
| EBIT | ₹347.28 Cr | 10.2% | |
| Net profit | ₹244.52 Cr | 8.0% | |
| EPS | ₹17.38 | 8.0% | |
| EBIT margin | 13.2% |
P&L walk
Consolidated revenue increased 30.0% YoY to ₹4314.89 Cr, but EBITDA growth of 18.7% to ₹569.21 Cr lagged sales as higher commodity and energy prices reduced EBITDA margin to 13.2%; EBIT rose 10.2% to ₹347.28 Cr and PAT rose 8.0% to ₹244.52 Cr.
Segments
Indian operations generated 73.7% of consolidated total income and supported standalone revenue growth of 36.3% YoY, while European revenue in euro terms grew only 1%, creating a material gap between the stronger Indian business and largely flat European operations.
Key positives
- Consolidated revenue grew 30.0% YoY to ₹4314.89 Cr, supported by Indian demand, cost pass-through and new-order ramp-up.
- Indian aftermarket sales increased 11.1% YoY to ₹125 Cr, adding resilience beyond OEM volumes.
- Standalone revenue grew 36.3% YoY to ₹3182.71 Cr and standalone PAT grew 17.4% to ₹194.62 Cr, materially ahead of consolidated growth.
- Indian two-wheeler and passenger-vehicle market volumes grew 23.6% and 23.0% YoY, supporting the company's established two-wheeler content and expanding four-wheeler presence.
- EPS growth of 8.0% matched consolidated PAT growth, indicating no disclosed dilution-related earnings-quality issue.
Key concerns
- Consolidated EBITDA margin declined 120bps YoY to 13.2% and standalone margin declined 180bps to 11.2% as higher commodity and energy prices were not fully neutralised at the percentage-margin level.
- EBITDA growth of 18.7% lagged revenue growth of 30.0%, while PAT growth was only 8.0%, showing weaker conversion of strong top-line growth into earnings.
- European revenue in euro terms grew only 1% YoY, and much of the 7.4% European new-car-registration growth came from Chinese OEMs that Endurance currently does not serve.
- Consolidated PAT growth of 8.0% significantly trailed standalone PAT growth of 17.4%, indicating that European operations and other group entities diluted the stronger Indian performance.
Research and educational content only. Not investment advice.