Garware Tech. Q1 FY27 Results (NSE: GARFIBRES)
Signal: Margin expansion
The read
Q1FY27 marked a strong quarter: consolidated revenue ₹482 Cr (+31.4% YoY) was the highest in recent quarters, driven by synthetic cordage and the OTS/AMS acquisition. EBITDA margin expanded 190bps to 20.5% on operating leverage (employee cost +11% only). PAT grew 21.6% to ₹64.6 Cr, while EPS rose 22.6% to ₹6.56. Standalone performance was weaker (PAT -11.2%), highlighting that group earnings are increasingly in subsidiaries. The buyback reduced shares by 1.63%, slightly boosting EPS. Segment assets in synthetic cordage suggest ongoing capex for growth.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4.82 Cr | 31.4% | 13.1% |
| EBIT | ₹0.9 Cr | 21.9% | |
| Net profit | ₹0.65 Cr | 21.6% | |
| EPS | ₹6.56 | 22.6% | |
| EBIT margin | 20.5% |
P&L walk
Revenue growth of 31.4% YoY driven by synthetic cordage (+36.6%) and OTS/AMS acquisition; EBITDA margin expanded 190bps to 20.5% as employee cost grew only 11% (operating leverage); gross margin stable at ~71%; other income lower; PAT growth of 21.6% trails revenue due to higher D&A and interest; EPS +22.6% slightly boosted by buyback.
Segments
Synthetic cordage segment revenue surged 36.6% YoY (₹380.7 Cr), driving consolidated growth; segment PBIT rose 36.2% and assets expanded 38%, reflecting capacity investment and OTS/AMS contribution. Fibre & Industrial grew 14.2% YoY but with strong PBIT growth of 51%. Consolidated PAT was 32% higher than standalone PAT, confirming subsidiary profitability.
Key positives
- Consolidated revenue growth of 31.4% YoY, the highest in recent quarters
- EBITDA margin expanded 190bps YoY to 20.5% on operating leverage (employee cost grew only 11% vs revenue +31%)
- Synthetic cordage segment revenue +36.6% YoY and segment assets +38%, indicating strong demand and capacity investment
- EPS growth of 22.6% YoY, aided by buyback reducing shares by 1.63%
Key concerns
- EBITDA margin contracted 210bps QoQ from 22.6% to 20.5%, though still healthy
- Standalone PAT declined 11.2% YoY, indicating earnings concentration in subsidiaries
- Other expenses (processing, testing) grew faster than revenue (38% vs 31%), partially offsetting operating leverage
- Comparability impacted by OTS/AMS acquisition (included for full period vs prior year partial)
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