Gujarat Fluoroch Q2 FY27 Results (NSE: FLUOROCHEM)
Signal: Margin pressure
The read
The recovery broadened into a 45.5% YoY revenue increase and 42.0% PAT growth, but the thesis now hinges on whether the 670bps gross-margin compression is temporary: EBITDA margin fell to 26.7% from 29.4% despite Chemicals delivering ₹505 crore EBITDA, while EV Products remained a ₹50 crore PBT drag.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,760 Cr | +45.5% | +10.8% |
| Net profit | ₹240 Cr | +42.0% | |
| EPS | ₹22.11 | +43.7% | |
| EBIT margin | 26.7% |
P&L walk
Revenue increased to ₹1,760 crore, +45.5% YoY and +10.8% QoQ, led by Chemicals; EBITDA rose 32.1% to ₹473 crore but margin fell 270bps to 26.7% as material costs rose to 35.6% of revenue from 28.8%, while PAT grew 42.0% to ₹240 crore.
Segments
Chemicals drove the group with ₹1,743 crore revenue and ₹389 crore PBT, while EV Products grew revenue to ₹41 crore but remained loss-making at ₹50 crore PBT, widening the standalone-to-consolidated PAT gap to ₹69 crore.
Key positives
- Consolidated revenue reached ₹1,760 crore, up 45.5% YoY and 10.8% QoQ, with Chemicals revenue at ₹1,743 crore, up 43.5% YoY.
- PAT increased 42.0% YoY to ₹240 crore and other income was only ₹10 crore, indicating that the profit increase was primarily operating-led.
- H1 operating cash flow rose 20.2% YoY to ₹738 crore despite ₹841 crore of capex, supporting the ongoing expansion cycle.
- Segment assets rose to ₹12,841 crore from ₹10,595 crore a year ago and depreciation rose 14.3% to ₹104 crore, a clean depreciation-to-capex signal.
Key concerns
- Gross margin fell approximately 670bps YoY to 64.6% as raw material and extraction costs rose to 35.6% of revenue from 28.8%; the filing does not disclose the cause.
- EBITDA margin declined 270bps to 26.7% because EBITDA growth of 32.1% lagged revenue growth of 45.5%, indicating cost absorption rather than operating leverage.
- EV Products generated only ₹41 crore revenue but a ₹32 crore EBITDA loss and ₹50 crore PBT loss, materially dragging consolidated earnings relative to standalone PAT of ₹309 crore.
Research and educational content only. Not investment advice.