Fractal Analyt. Q1 FY27 Results (NSE: FRACTAL)
Signal: Growth decelerated
The read
The growth engine remains intact, with consolidated revenue up 20.0% YoY to ₹9125 million and Fractal.ai segment result up 42.6% to ₹1577 million, but the trajectory is mixed because EBITDA margin fell 220bps QoQ to 17.8%, Fractal Alpha's loss widened to ₹148 million, and EPS growth of 78.8% lagged PAT growth of 91.8%.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | 9,125 million | +20.0% | +3.0% |
| EBIT | 1,227 million | N/A | |
| Net profit | 723 million | +91.8% | |
| EPS | ₹4.31 | +78.8% | |
| EBIT margin | 17.8% |
P&L walk
Revenue increased to ₹9,125 million, up 20.0% YoY and 3.0% QoQ, while EBITDA margin was 17.8%, down 220bps QoQ; PAT reached ₹723 million, up 91.8% YoY but down 37.6% QoQ, with the YoY profit comparison helped by the prior-year exceptional charge and lower associate loss growth.
Segments
Fractal.ai drove the group with ₹8942 million of revenue and ₹1577 million of segment result, while Fractal Alpha remained loss-making at -₹148 million and the associate contributed a ₹234 million loss.
Key positives
- Consolidated revenue increased 20.0% YoY to ₹9125 million and 3.0% QoQ, maintaining growth near the company's 19.3% three-year sales CAGR.
- Fractal.ai revenue rose 20.6% YoY to ₹8942 million and its segment result increased 42.6% YoY to ₹1577 million.
- Consolidated employee benefits expense grew 14.0% YoY versus 20.0% revenue growth, reducing employee-cost intensity by 365bps YoY to 69.2%.
- Finance costs declined 25.4% YoY to ₹88 million and 31.8% QoQ, supporting profit conversion.
Key concerns
- EBITDA margin declined 220bps QoQ to 17.8% from 20.0% in Q4FY26, interrupting the recent margin recovery.
- Fractal Alpha generated only ₹240 million of revenue and a segment loss of ₹148 million, with the loss worsening from ₹130 million QoQ and ₹43 million YoY.
- The ₹234 million associate loss increased from ₹72 million QoQ and remained material at 24.1% of consolidated PBT before exceptional items.
- Basic EPS rose 78.8% YoY to ₹4.31, materially below 91.8% PAT growth, reflecting the effect of the enlarged equity base.
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