Gallantt Ispat L Q2 FY27 Results (NSE: GALLANTT)
Signal: Margin pressure
The read
The key inflection is renewed margin deterioration: revenue grew 13.1% YoY and was flat QoQ, but gross margin contracted 440bps YoY to 21.0% and derived EBITDA margin fell to 9.6% from 13.0%; this is the fourth consecutive quarter of YoY margin contraction in the recent results series, while higher CWIP and borrowings have yet to translate into operating profit.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,145.89 Cr | +13.1% | +0.0% |
| Net profit | ₹60.51 Cr | -32.0% | |
| EPS | ₹2.51 | -30.7% | |
| EBIT margin | 9.6% |
P&L walk
Revenue increased to ₹114,589.15 lakh, +13.1% YoY and broadly flat QoQ, but gross margin compressed 440bps YoY to 21.0%; EBITDA margin fell to 9.6%, while PAT declined 32.0% to ₹6,051.07 lakh as PBT fell 19.3% and tax expense rose 43.7%.
Key positives
- Revenue from operations rose 13.1% YoY to ₹114,589.15 lakh while remaining broadly flat QoQ, and employee plus other expenses grew only 3.7% YoY versus revenue growth of 13.1%.
- Other income increased 37.3% YoY to ₹1,815.24 lakh, providing partial support to pre-tax earnings despite operating-margin pressure.
- CWIP rose to ₹59,836.94 lakh from ₹34,905.32 lakh at March 31, 2026, indicating continued investment in the expansion pipeline.
Key concerns
- Gross margin compressed 440bps YoY to 21.0% and derived EBITDA margin fell 342bps YoY to 9.6%, extending the recent margin contraction trend.
- PAT declined 32.0% YoY to ₹6,051.07 lakh despite revenue growth, with PBT down 19.3% and tax expense up 43.7% to ₹2,266.30 lakh.
- Operating cash flow was ₹9,082.36 lakh in H1FY27 against ₹27,846.60 lakh of fixed-asset and CWIP purchases, while cash and cash equivalents fell to ₹111.58 lakh.
- Borrowings rose to ₹59,197.39 lakh from ₹54,768.70 lakh at March 31, 2026 as CWIP expanded, increasing execution and funding dependence.
Research and educational content only. Not investment advice.