ERIS Lifescience Q2 FY27 Results (NSE: ERIS)
Signal: Margin pressure
The read
The operating trajectory softened despite headline growth: consolidated revenue rose 12.61% YoY to ₹892.37 crore but operating margin contracted 121bps to 26.80%, while PAT growth to ₹187.14 crore was primarily tax-led by a ₹31.23 crore tax credit and supported by a ₹35.90 crore exceptional charge treatment.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹892.37 Cr | +12.61% | +2.19% |
| Net profit | ₹187.14 Cr | +39.16% | |
| EPS | ₹13.26 | +50.34% | |
| EBIT margin | 26.80% |
P&L walk
Consolidated revenue increased to ₹892.37 crore, +12.61% YoY and +2.19% QoQ, but operating margin declined to 26.80% from 28.01% YoY; PAT rose to ₹187.14 crore, +39.16%, mainly because tax expense shifted to a ₹31.23 crore credit.
Segments
The consolidated group materially outperformed the parent: consolidated revenue rose 12.61% YoY to ₹892.37 crore while standalone revenue fell 25.87% to ₹482.24 crore, showing that subsidiaries are driving the reported growth.
Key positives
- Consolidated revenue reached ₹892.37 crore, +12.61% YoY, accelerating from the prior-year base and rising 2.19% QoQ.
- Finance costs declined 6.32% YoY to ₹46.42 crore and interest service coverage improved to 5.15 times from 4.48 times YoY.
- Operating cash flow rose to ₹637.13 crore in H1FY27 from ₹239.05 crore, while cash and cash equivalents increased to ₹238.09 crore from ₹54.74 crore.
- CWIP increased to ₹394.94 crore from ₹171.47 crore, indicating a larger investment base that could support future capacity or product expansion.
Key concerns
- Operating margin declined 121bps YoY to 26.80% even as revenue grew 12.61%, with other expenses increasing 26.62% to ₹208.10 crore.
- Standalone revenue fell 25.87% YoY to ₹482.24 crore and standalone operating profit before exceptional items fell 49.11% to ₹119.41 crore, creating a material parent-versus-group divergence.
- Consolidated PAT growth of 39.16% to ₹187.14 crore was not matched by operating profit growth, as tax expense shifted from a ₹38.20 crore charge to a ₹31.23 crore credit.
- The group recognised a ₹35.90 crore exceptional write-down related to settlements with customers for products launched at risk in earlier periods.
Research and educational content only. Not investment advice.